Jack Reed

Mr. REED

Mr. REED. Mr. President, I rise in support of the conference report on the tax relief package. I believe the conference report represents significant progress from previous efforts to provide tax relief for hard-working American families that are struggling to pay their bills, educate their children, and save for retirement. As one who voted against the previous Senate version of the tax cut bill, I commend the conferees and the administration negotiators who worked to address some of the concerns that I and others expressed with the previous legislation to develop this compromise. However, I must also express strong concern with several provisions that remain in the bill. I believe that the provisions related to capital gains taxes, IRA's, and estate taxes unfairly benefit the wealthiest Americans, and threaten to upset the fiscally responsible decisions, such as passage of the 1993 deficit reduction package, that enabled us to reduce the deficit to its lowest point as a percentage of GDP since 1974. However, when considered in the context of the larger effort at bipartisan compromise and the willingness to expand healthcare coverage to millions of children, I believe this legislation presents a good deal for many working American families. In particular, the tax cuts contained in the conference report provide a greater amount of tax relief to middle income Americans than previous versions of this bill. For example, under the bill passed by the Finance Committee, the second lowest 20 percent of income earners would have experienced a tax increase, whereas under the conference report, these Americans would enjoy a tax cut. Although I still have concerns that a substantial share of the tax cuts will go to the highest income Americans, these concerns are counterbalanced by the fact that middle-income Americans will enjoy significant tax reductions and expanded educational incentives which were not as prominent in prior versions of this bill. As I have stated throughout the debate on this bill, I have reservations about provisions in the bill related to the capital gains tax, new backloaded IRA's, and the estate tax. Particularly disturbing is the fact that these tax reductions, which come at a significant cost after 2002, will almost exclusively benefit the wealthiest Americans. For example, the Joint Tax Committee has estimated that three-quarters of Americans receiving capital gains income are households that earn over $100,000 annually. Similarly, only 1.6 percent of estates are valued high enough to qualify for capital gains increases. Meanwhile, these tax cuts will cost $75 billion over 10 years. Beyond favoring the wealthy, I am concerned that the cost of these tax cuts, many of which are backloaded, will explode in the years after 2002 and ultimately upset the progress we have made on deficit reduction. These concerns are supported by the 10-year revenue estimates recently released by the Joint Tax Committee which suggests that the cost of this tax bill will be $275 billion over 10 years. This level of revenue loss may prove difficult to sustain, and I would hope my colleagues will protect vital investments like education and infrastructure if difficult economic times arise. At the same time, I believe that the conferees have made significant progress on the education tax provisions included in the bill. Of particular note is the decision to extend education tax reductions for the third and fourth years of a college education. The Finance Committee-passed tax bill did not extend benefits to years three and four, and I believed this was a major shortcoming of that legislation. By providing benefits for the duration of the average college education, I believe the provisions included in the conference report better reflect the realities facing many individuals desiring to get a college education. Indeed, this compromise before us today provides $41 billion in education tax incentives for those looking to invest in their education. I also support the changes that have been made to the child tax credit that will enable a greater number of middle- and lower-income Americans to utilize the credit. By making the credit partially refundable against payroll taxes, the legislation reflects the reality that the most significant tax burden of many low-income Americans is that of the payroll tax. The Senate bill provided no tax credit to many families making under $30,000. This compromise does. I would also like to express my support for the decision to keep provisions in the bill that will expand the use of IRA's to allow withdrawals for first-time home buyers. Perhaps the greatest hurdle faced by many first-time home buyers is the inability to get the necessary funds for a downpayment on a home. Provisions in the tax bill will lower this hurdle and enable us to continue to increase home ownership, which is currently at a 17-year high. In conclusion, I believe the tax bill will provide tax relief to hard-working American families who have faced stagnating wages and tough employment prospects. I am pleased that we in Congress have made the difficult budget decisions which laid the foundation for the tax cuts we are able to provide today. I would caution, however, that we must be ever-vigilant in ensuring that the tax cuts will not overheat the economy or lead to an explosion of the deficit. Indeed, we must be prepared to make the tough decisions that we will be called upon to make in the event that the revenue projections in this agreement do not come to fruition. As we prepare to vote on this legislation, I would encourage my colleagues to celebrate our success, but to consider the concerns that I have set forth. Mr. President, I will support this bill with reservations, but I also recognize as should we all, that this agreement is a compromise between a President and a Congressional majority of different political parties. As such, it embodies the often conflicting demands and ideals of each group. It is in this spirit that I will vote for the package.

Mr. REED

Mr. REED. Mr. President, yesterday, while thousands of innocent men, women and children shopped in Mahane Yehuda market in Jerusalem, the peace of that sunny afternoon was shattered when two bombs filled with screws and nails detonated. Fifteen people were killed, close to 200 persons were injured. Later that day, the Israeli Cabinet voted to break off all contact with the Palestinian Authority, jeopardizing hopes that had soared just days ago when Israelis and Palestinians had agreed to resume peace talks for the first time since March. I have always been a strong supporter of the peace process, and there is no doubt in anyone's mind that this is a complicated issue and peace will only be secured after prolonged negotiations and compromises on both sides. No one expects it to be easy. However, the first step simply must be to end the violence. Terrorist acts such as yesterday's bombing simply cannot be tolerated. There is no reason, no excuse, no possible justification for killing innocent civilians shopping in a street market. It is an act of terrorism, nothing more, nothing less. Peace cannot be secured until the citizens of the Middle East are certain that they are safe. They will not feel safe until they trust each other, and they will not trust each other until their actions match their words and deeds. Yasser Arafat said he condemns these terrorists. He said it is an act against the peace process. Yet, it is more than likely that a known terrorist group detonated those bombs in the market. These terrorist groups have never had to account for their violent deeds. The Palestinian Authority must match its words of condemnation with acts. It must take tangible steps to increase security activity and security cooperation. It must be committed to bringing those who are responsible for this unconscionable act of terrorism to justice. Only when it is clear that these acts of terrorism will no longer be tolerated will they cease. Only when they cease can we take another step down that very long road to peace. I extend my condolences to the families of those who were killed. It is my sincere hope it is the last time that the people of Israel and the people of Palestine will endure the suffering and fear that terrorist acts bring. I yield back the remainder of my time. Ms. MOSELEY-BRAUN addressed the Chair.

Mr. REED

Mr. REED. No. Close to 5 minutes.

Mr. REED. Mr. President, I request such time as I may consume from the Senator from New Jersey.

Mr. REED. Thank you, Mr. President. Mr. President, I rise to speak in favor of this bill. As one who voted against the Senate version of this legislation, I am especially pleased today to be able to support this initiative--an initiative that, among other things, provides 10 years of solvency to the Medicare Program, and makes a substantial investment in the health care of our children. I would like to remind my colleagues that we were able to craft this agreement because of the tough vote that I and others cast in 1993 for President Clinton's deficit reduction plan--a plan that has reduced the deficit from almost $300 billion to approximately $40 billion or perhaps lower. I am particularly pleased that this bill makes a remarkable investment in the health care of our children by providing $24 billion to States to spend for children's health care. This new program represents the most significant and far-reaching expansion in our social programs since the passage of Medicaid and Medicare in the mid- 1960's. These children's health provisions will give our children the healthy start that they deserve, and the healthy start that is necessary to help young people become effective students and help these students become effective workers, and help all of us raise a generation of American citizens who will serve this country and lead the world. Congress is committing significant resources to children's needs. And now we must turn our attention to the days ahead to ensure that these resources are used wisely. I remain cautious about this new initiative. As with any investment of our taxpayer's dollars, the Federal Government needs to ensure that the investment is well spent. The plan which is being offered today provides a wide array of options and benefit plans with a high degree of flexibility. And it is crafted in a such a way that it could perhaps be gamed--not for the benefit of the children but for the benefit of those who will be enriching themselves from the system. As this program is implemented, we need to provide adequate oversight to ensure that the children are the beneficiaries of this program, and that they receive the benefits they need, that their health care is protected, and that we as a Nation can prosper. The Secretary of the Department of Health and Human Services, along with the Congress, has her work cut out for her. And together we must ensure that this program is implemented wisely and benefits the children that we so desperately and appropriately want to serve. In addition, this conference agreement makes significant changes in the Medicare Program. Most importantly, this bill brings 10 years of solvency to the Medicare Program--a program that more than 30 million Americans depend upon, and that more than 170,000 Rhode Islanders depend upon. Like the amendment I offered during the debate on the Senate version of this bill, this legislation does not include the provisions which I believe take the wrong approach to solving our Medicare problems-- provisions like raising the eligibility age, means testing for the part B premiums, and a home health copayment for home health services. This legislation strikes those provisions, as my previous amendment struck those provisions. A home health care copayment would have negatively impacted the sickest and poorest of Medicare beneficiaries. And an increase in Medicare's eligibility age is a step in the wrong direction. Simply put, raising the eligibility age for Medicare increases the ranks of the uninsured. Already, 13 percent of the 21 million people age 55 to 64 lack health insurance. It makes no sense at all for Congress to eliminate Medicare as an option for seniors who have nowhere else to turn. These and other issues will be debated in the context of long- term Medicare reform as we address the problems faced by Medicare for the next generation. During the Senate debate on this bill, as I indicated, I offered an amendment to strike these provisions. My amendment failed. But I am glad to see that today we have reached an agreement which protects Medicare, extends the life of the program for at least 10 years and does not attempt an ad hoc approach to structural reform. This bill includes many improvements to Medicare. For example, it has expanded preventive health care benefits for mammography, pap smears, diabetes, prostate, and colorectal cancer screening, bone density measurements, and vaccines. This bill also requires the Medicare Program and managed care plans to give more information to beneficiaries about their choices and their coverage, and the quality of that coverage. All of these are welcome developments. I am also pleased that this bill contains $1.5 billion for protecting low-income Medicare beneficiaries against an increase in Medicare premiums. However, I am disappointed that this comes in the form of a block grant to the States that ends after 2002. This approach has the potential to fall short of providing real protection for low-income Medicare beneficiaries. Any increase in Medicare premiums can result in significant hardships for low-income seniors, and these individuals deserve a permanent guarantee of protection. This bill also includes numerous changes in Medicare reimbursement policies--changes that will have a great impact on those individuals and institutions that provide health care to Medicare beneficiaries. I will keep a vigilant eye on the implementation of these changes, paying particular attention to their impact on the access to and quality of care provided to Medicare beneficiaries. This legislation also establishes a bipartisan national commission to examine the long-term solvency of the Medicare Program. The creation of this commission lays an important foundation to work on long-term reforms and solutions, and to tackle those issues that are not suitable for the narrow confines of a budget debate. Such reform is needed to address the challenges that the Medicare Program will face as members of the baby-boom generation become recipients of Medicare. This commission provides that framework, and I am encouraged that the commission is established by this legislation. I am prepared to vote in favor of this bill. As with any piece of legislation, it is not perfect. Indeed, many individuals will benefit from various provisions of the bill. Medicare beneficiaries will have the security of an additional 10 years of solvency in the program. The families of uninsured children will now have new State programs to turn to. Medicare beneficiaries will have new choices and increased preventive health care benefits. But this is no time to rest on our laurels. To ensure that Medicare beneficiaries continue to have access to high-quality care in the face of constrained payments to providers, to ensure that the $24 billion for children's health care is well spent, and to ensure the long-term viability of the Medicare Program, we will need continued vigilance on the part of many, including the Congress, the Secretary of Health and Human Services, and those persons served by the Medicare and Medicaid Programs. We also must recognize that within this budget, as we continue to draw down discretionary spending over the next several years, harder and harder choices will ensue. We have to ensure that we make the right choices. We have to ensure that the spirit today--a spirit that reaches out to help our children, a spirit that reaches out to help and maintain our seniors--will be the spirit that dominates our future budget deliberations as it has ennobled our past efforts to strengthen America. I yield the remainder of my time. Mr. COATS addressed the Chair.

Mr. REED. I ask for 10 minutes.

Mr. REED

Mr. REED. Mr. President, reclaiming my time, I thank the Senator from New Hampshire for his support. I would like to just briefly describe the problem and also the ongoing discussion with the FCC and also here within Congress. First, as both my colleagues have indicated, this is an alarming and growing problem. The Federal Communications Commission is dealing with the problem now. They will shortly propose a rule that will take away the financial incentive for some of these renegade companies who essentially illegally change service. Surprisingly, today under FCC rules, a renegade company can, in fact, illegally switch a customer and still get the benefits of that month or of several months of charges. The FCC has proposed to change this. This sense-of-the-Senate resolution supports that proposed rule change and the other activities the FCC is contemplating. One of the reasons we are here today is that, under the present rules of the FCC, telephone companies must get either a verbal or written response in terms of a formal request to change. The problem with respect to a written consent is that, many times, they are hidden in sweepstakes promotions, giveaways and, in fact, the nature of the written response is unknown to the consumer. Once again, the FCC is proposing to change this new rule. I support that change and encourage them to go forward. The phone company can also rely upon the verbal assent of a consumer, but there are problems with this verbal assent, also. Some of the problems we have seen with telemarketers are the fact that they will deceive the consumer about identity or the nature of the service, or they will obtain the consent of a child, or stranger in the household, or disregard the consumer's decline to switch the service, or flatout not even bother to get the verbal assent and claim that they do in retrospect. The problem with this verbal authorization is proof. Again, the FCC has taken some steps in this regard. They are proposing to eliminate what is an option today, where someone presumably could consent over the phone and then receive a package later from the company requiring that consumer to send a card in to deny the service change. The FCC once again is trying to eliminate that procedure, also. These are all positive steps. I encourage, and this resolution encourages, the FCC to pursue those steps. This is a major problem for consumers in the United States. Fifty million people each year switch their phone service. One million of those switches are likely to be fraudulent. One regional carrier now estimates that 1 in 20 of the switches in their system are fraudulent switches. This problem has tripled since 1994. It is now the FCC's No. 1 consumer complaint. Therefore, this problem is something that we should deal with, and deal with decisively. In my own home State of Rhode Island, there are abundant examples of consumers who have been disadvantaged by this illegal switching. Indeed, the Rhode Island Public Utilities Commission has noted this complaint as the No. 1 complaint they receive with respect to telephone services. For example, a small businessperson in Newport, RI, had his 800 number switched, and rather than an 800 number, the only people who could call the business were residents of Alaska. In Smithfield, RI, a family had their phone service illegally switched. They protested, but before they could rectify the problem, their phone service was terminated because they refused to pay the bill for the illegal company that switched them. These are problems that have to be addressed, and I hope are being addressed today by the FCC, and perhaps ultimately our legislation in this body. What I hope we could do would be to focus more resources of the FCC on this problem. In 1996, the FCC received 16,000 complaints about slamming, but they only were able to successfully prosecute and induce judgment against 15 companies. They don't have the resources. They need those resources. Indeed, I worry that law enforcement agencies around the country not only lack resources but lack, ultimately, the proof that a switch has been made illegally. Law enforcement officials in certain States, such as Connecticut, Wisconsin, California, Texas, and Illinois, have been successful, but they need additional support. Indeed, one of the major elements of the legislation I was contemplating was the requirement not only of written proof but, also, in the case that an oral or verbal consent was given, some type of recording of assent so that law enforcement authorities could verify decisively whether or not the appropriate assent had been made. It is necessary for us to balance the needs for a flexible system by which consumers can make choices and change their service to one that protects their right to ensure that it is their choice and not the result of fraudulent or manipulative practices by unscrupulous companies. I believe we can do that. I believe we have taken a step forward today with this sense-of-the- Senate resolution to start on that path. I look forward to offering independent legislation which I think will assist the current effort of the FCC to resolve this grave problem that is growing each day. Once again, I thank my colleagues, Senator Gregg, Senator Hollings, Senator McCain, and Senator Burns, for their work and for their effort on this. Others are interested. I know Senator Campbell and Senator Durbin are also interested in this problem. We have an opportunity today to send a strong message to the FCC to move forward and also to continue to contemplate and deliberate about legislation which will assist in their efforts and end this scandalous problem, the No. 1 consumer complaint today with respect to telecommunications slamming. I thank my colleagues. I yield the remainder of my time. Mr. KERRY addressed the Chair.

Mr. REED. Mr. President, I yield to the Senator from New Hampshire, without losing my right to the floor.

Mr. REED. Mr. President, I would like to take a moment to discuss a sense-of-the-Senate resolution which is included, I believe, in the managers' amendment, with the concurrence of the Senator from New Hampshire and the Senator from South Carolina. The thrust of my amendment is to confront an issue which is growing-- the issue of slamming--where individuals who have signed up for long distance telephone service have their service changed illegally. This is a growing problem, a problem that we must confront. It is a problem that--in fact, as I considered it, I also contemplated the construction of an amendment to this appropriations bill that would have dealt with the problem by mandating better proof that a customer has actually changed service, including criminal penalties for slamming, and other deterrences. As I spoke with my colleagues and law enforcement officials, I came to realize, through many different viewpoints, that an amendment at this time would delay the appropriations process. So rather than introducing an amendment, I have proposed a sense-of-the-Senate resolution which, again, I believe has been accepted and will be maintained within the managers' agreement. Before going forward, I commend and thank the chairman, Senator Gregg, and the ranking member, Mr. Hollings, and also Chairman McCain and Chairman Burns for their generous assistance in this endeavor.

Mr. REED

Mr. REED. Madam President, I stand in strong support of the Harkin amendment. We know today 90 percent of the adults who are smoking started when they were children. We know, if current trends continue, 5 million kids today under 18 years old will die because of smoking related diseases. We know all this, yet we are doing nothing effective to stop the use of tobacco products by children under 18 years of age. The Harkin amendment would actually provide resources to ensure that the FDA regulations are enforced. That, to me, is the most critical test. I believe we should support this amendment wholeheartedly. I yield the floor.

Mr. REED

Mr. REED. Mr. President, I rise today to discuss legislation I have just introduced, the Campaign Spending Control Act of 1997. The 1996 elections, unfortunately, will be remembered for two remarkable facts. First, Federal campaigns produced record spending; over $2.7 billion or almost $28 for every voter. Second, the election produced record-low voter participation: less than half of those eligible chose to vote. These two tragic facts are inextricably linked. Due to the vast sums of money spent on campaigns, most Americans believe our current campaign system is tainted by special interest money. Under a flood of money and television ads, voters view their voice as meaningless, their concerns as unaddressed, and their votes as unimportant. In order to restore public confidence, campaign finance reform must accomplish three goals. It must significantly reduce campaign spending; level the playing field for those who challenge incumbents; and, finally, encourage greater public participation and debate. These goals cannot be successfully addressed without significantly changing the rules which govern campaigns. Campaign scandals have posed a threat to the health of our democracy throughout our Nation's history. In 1907, after enduring embarrassment over a campaign scandal, President Teddy Roosevelt championed legislation prohibiting corporations from financing Federal candidates. In 1974, responding to the scandals of the 1972 elections and the resignation of President Nixon, Congress overwhelmingly passed legislation limiting spending by candidates, parties, and wealthy individuals. In 1996, all the past campaign reforms imploded, with a flood of corporate and individual money overwhelming legal limits. Million- dollar corporate contributions funded advertisements to impact Presidential and congressional campaigns. Well-funded individuals and organizations also got into the act. By spending a record $70 million on so-called issue advertising, labor unions, business organizations, and ideological groups circumvented limits on direct contributions to candidates. Thus, candidates, awash in a sea of outside money, were pushed to not only trounce their opponents in fundraising, but to match outside groups. The chase for dollars sapped candidates' time which could have been spent debating, attending forums, and otherwise engaging voters. Once solicited, most of these millions were spent on uninformative, 30-second advertisements, which only served to further alienate the electorate. Unchecked, this campaign system will spiral into exponential spending increases, further disenfranchisement, and less dialog. The system is already close to collapsing under its own weight; the time to act is now. The roots of this abysmal situation can be traced to a misguided Supreme Court decision. In Buckley versus Valeo, a 1976 case which challenged the 1974 campaign reform legislation, the Court held that, in order to avoid corruption, contributions to candidates and committees could be limited. However, the Court invalidated expenditure limits on candidates and independent entities as infringements on free speech rights. The Court surmised that unlimited spending would increase the number and depth of issues discussed. Twenty years of campaign spending has proven the Court's decision fatally flawed: fewer issues are discussed, less debate occurs, and voter participation has declined. The single most important step to reform elections and revitalize our democracy is to reverse the Buckley decision by limiting the amount of money that a candidate or his allies can spend. For this reason, Senators Bryan, Hollings, Johnson, and I are introducing legislation which directly challenges the Buckley decision and places mandatory limits on all campaign expenditures. These limits do not favor incumbents. Over the last three elections, these limits would have restricted 80 percent of incumbents, while only impacting 18 percent of those who challenged incumbents. Additionally, this legislation would fully ban corporate contributions, as well as unlimited and unregulated contributions by wealthy individuals and organizations. Further, our bill would limit campaign expenditures by supposedly, neutral, independent groups, and restrict corporations, labor unions, and other organizations from influencing campaigns under the guise of issue advocacy. The end result of this legislation would be to eliminate over $500 million from the system, discourage violations, encourage challenges to incumbents, and further promote debate among both candidates and the electorate. What effect would these limits have on political debate? Contrary to the Supreme Court, I believe such limits would increase dialog. Candidates would be free from the burdens of unending fundraising and thus be available to participate in debates, forums, and interviews. With greater access to candidates and less reason to believe that candidates were captives of their contributors, voters might well be more prepared to invest the time needed to be informed on issues of concern and ask candidates to address them. Some will argue that this legislation impinges upon freedom of speech. The bill will marginally restrict the rights of a few to spend money--not speak--so that the majority of voters might restore their faith in the process. Thus, speech will be restricted no more than necessary to fulfill what I believe to be several compelling interests. Such a restriction conforms with constitutional jurisprudence and has been demonstrated necessary by history. The fact is all democratic debates are restricted by rules. My legislation would simply implement necessary rules into our campaign system. Finally, it is important to remember that the vast majority of Americans, 96 percent, have never made a political contribution at any level of government. Capping expenditures will truly impact very few individuals, and that restriction will be marginal, but necessary. Implementing spending caps is a grass-roots initiative. Elected officials from 33 States have urged that the Buckley decision be revisited and limits implemented. Legislative bodies in Ohio and Vermont have implemented sweeping reform by enacting mandatory caps on candidate expenditures. Other States, such as my own, have embraced public financing as a means of reform. Yet, today, Congress struggles to even consider the most modest of reforms, such as banning so called soft money: unlimited donations by corporations, labor unions, and wealthy individuals to political party committees. Unfortunately, because most of the current reform proposals accept the reasoning enunciated in the Buckley decision, they will only serve to redirect an unlimited flow of cash. While I enthusiastically support any substantive reform, if we are to address the underlying cancer which has disintegrated voter trust and participation, the problem of unlimited expenditures must be directly confronted. This is a step that one municipality and two States have embraced. Many more State officials as well as prominent constitutional law scholars have urged such a course. Expenditure limitations have been proposed by congressional reformers in the past, and it is time to rededicate ourselves to this goal. Mr. President, I have a list of the 33 State officials and 24 State attorneys general who have urged the reversal of Buckley. I ask unanimous consent that these documents be printed in the Record.

Mr. REED. Mr. President, our democracy is dependent upon participation, stimulated by a belief that the system works for everyone. Just as scandals led to reform in 1907 and 1974, Congress must now rise to the task once again to address a threat to our democratic process. Polls continue to demonstrate that a majority of Americans believe the political process is controlled by wealthy interests. The most dangerous aspect of the current situation is that polls also show that voters have no faith in the ability of their representatives to implement reform. If we do not address the influence of money in our electoral system, the health of our democracy will endure increasing risk. It is time to begin true, comprehensive reform. I would like to thank Senators Bryan, Hollings, and Johnson for joining me in this endeavor. Their leadership on this issue in the past has proven invaluable, and I am proud that they have chosen to join me in this important effort. It is my hope that the Senate will now move to address the problem of our campaign system at its root. Finally, Mr. President, I ask unanimous consent that the text of this bill be printed in the Record.

Mr. REED

Mr. REED. Mr. President, our democracy is dependent upon participation, stimulated by a belief that the system works for everyone. Just as scandals led to reform in 1907 and 1974, Congress must now rise to the task once again to address a threat to our democratic process. Polls continue to demonstrate that a majority of Americans believe the political process is controlled by wealthy interests. The most dangerous aspect of the current situation is that polls also show that voters have no faith in the ability of their representatives to implement reform. If we do not address the influence of money in our electoral system, the health of our democracy will endure increasing risk. It is time to begin true, comprehensive reform. I would like to thank Senators Bryan, Hollings, and Johnson for joining me in this endeavor. Their leadership on this issue in the past has proven invaluable, and I am proud that they have chosen to join me in this important effort. It is my hope that the Senate will now move to address the problem of our campaign system at its root. Finally, Mr. President, I ask unanimous consent that the text of this bill be printed in the Record.

Mr. REED. Mr. President, I rise today to discuss legislation I have just introduced, the Campaign Spending Control Act of 1997. The 1996 elections, unfortunately, will be remembered for two remarkable facts. First, Federal campaigns produced record spending; over $2.7 billion or almost $28 for every voter. Second, the election produced record-low voter participation: less than half of those eligible chose to vote. These two tragic facts are inextricably linked. Due to the vast sums of money spent on campaigns, most Americans believe our current campaign system is tainted by special interest money. Under a flood of money and television ads, voters view their voice as meaningless, their concerns as unaddressed, and their votes as unimportant. In order to restore public confidence, campaign finance reform must accomplish three goals. It must significantly reduce campaign spending; level the playing field for those who challenge incumbents; and, finally, encourage greater public participation and debate. These goals cannot be successfully addressed without significantly changing the rules which govern campaigns. Campaign scandals have posed a threat to the health of our democracy throughout our Nation's history. In 1907, after enduring embarrassment over a campaign scandal, President Teddy Roosevelt championed legislation prohibiting corporations from financing Federal candidates. In 1974, responding to the scandals of the 1972 elections and the resignation of President Nixon, Congress overwhelmingly passed legislation limiting spending by candidates, parties, and wealthy individuals. In 1996, all the past campaign reforms imploded, with a flood of corporate and individual money overwhelming legal limits. Million- dollar corporate contributions funded advertisements to impact Presidential and congressional campaigns. Well-funded individuals and organizations also got into the act. By spending a record $70 million on so-called issue advertising, labor unions, business organizations, and ideological groups circumvented limits on direct contributions to candidates. Thus, candidates, awash in a sea of outside money, were pushed to not only trounce their opponents in fundraising, but to match outside groups. The chase for dollars sapped candidates' time which could have been spent debating, attending forums, and otherwise engaging voters. Once solicited, most of these millions were spent on uninformative, 30-second advertisements, which only served to further alienate the electorate. Unchecked, this campaign system will spiral into exponential spending increases, further disenfranchisement, and less dialog. The system is already close to collapsing under its own weight; the time to act is now. The roots of this abysmal situation can be traced to a misguided Supreme Court decision. In Buckley versus Valeo, a 1976 case which challenged the 1974 campaign reform legislation, the Court held that, in order to avoid corruption, contributions to candidates and committees could be limited. However, the Court invalidated expenditure limits on candidates and independent entities as infringements on free speech rights. The Court surmised that unlimited spending would increase the number and depth of issues discussed. Twenty years of campaign spending has proven the Court's decision fatally flawed: fewer issues are discussed, less debate occurs, and voter participation has declined. The single most important step to reform elections and revitalize our democracy is to reverse the Buckley decision by limiting the amount of money that a candidate or his allies can spend. For this reason, Senators Bryan, Hollings, Johnson, and I are introducing legislation which directly challenges the Buckley decision and places mandatory limits on all campaign expenditures. These limits do not favor incumbents. Over the last three elections, these limits would have restricted 80 percent of incumbents, while only impacting 18 percent of those who challenged incumbents. Additionally, this legislation would fully ban corporate contributions, as well as unlimited and unregulated contributions by wealthy individuals and organizations. Further, our bill would limit campaign expenditures by supposedly, neutral, independent groups, and restrict corporations, labor unions, and other organizations from influencing campaigns under the guise of issue advocacy. The end result of this legislation would be to eliminate over $500 million from the system, discourage violations, encourage challenges to incumbents, and further promote debate among both candidates and the electorate. What effect would these limits have on political debate? Contrary to the Supreme Court, I believe such limits would increase dialog. Candidates would be free from the burdens of unending fundraising and thus be available to participate in debates, forums, and interviews. With greater access to candidates and less reason to believe that candidates were captives of their contributors, voters might well be more prepared to invest the time needed to be informed on issues of concern and ask candidates to address them. Some will argue that this legislation impinges upon freedom of speech. The bill will marginally restrict the rights of a few to spend money--not speak--so that the majority of voters might restore their faith in the process. Thus, speech will be restricted no more than necessary to fulfill what I believe to be several compelling interests. Such a restriction conforms with constitutional jurisprudence and has been demonstrated necessary by history. The fact is all democratic debates are restricted by rules. My legislation would simply implement necessary rules into our campaign system. Finally, it is important to remember that the vast majority of Americans, 96 percent, have never made a political contribution at any level of government. Capping expenditures will truly impact very few individuals, and that restriction will be marginal, but necessary. Implementing spending caps is a grass-roots initiative. Elected officials from 33 States have urged that the Buckley decision be revisited and limits implemented. Legislative bodies in Ohio and Vermont have implemented sweeping reform by enacting mandatory caps on candidate expenditures. Other States, such as my own, have embraced public financing as a means of reform. Yet, today, Congress struggles to even consider the most modest of reforms, such as banning so called soft money: unlimited donations by corporations, labor unions, and wealthy individuals to political party committees. Unfortunately, because most of the current reform proposals accept the reasoning enunciated in the Buckley decision, they will only serve to redirect an unlimited flow of cash. While I enthusiastically support any substantive reform, if we are to address the underlying cancer which has disintegrated voter trust and participation, the problem of unlimited expenditures must be directly confronted. This is a step that one municipality and two States have embraced. Many more State officials as well as prominent constitutional law scholars have urged such a course. Expenditure limitations have been proposed by congressional reformers in the past, and it is time to rededicate ourselves to this goal. Mr. President, I have a list of the 33 State officials and 24 State attorneys general who have urged the reversal of Buckley. I ask unanimous consent that these documents be printed in the Record.

Mr. REED

Mr. REED. Mr. President, very briefly, I commend the Senator from Michigan and the Senator from Virginia and my colleagues who have proposed the second-degree amendment. I also commend the Senator from Wisconsin, Senator Feingold, for focusing our attention on this very critical issue. The danger for an immediate cutoff of funds, I think, is threefold. First, essentially demoralizing our troops. It would be very difficult for them to understand that we have cut off funds now for an operation that is extending into June 1998. In effect, it would be like the difference between knowing that your lease expires in June 1998 and getting the eviction notice. Cutting off of funds is very close to being evicted. I don't think our troops will understand that. Second, it would paralyze our efforts to construct a follow-on force by our European allies, a force that would not contain American troops but a force that would be necessary to maintain the peace in Bosnia. If we were to announce today a cutoff of funds, I believe we would have no chance to construct this follow-on force by our European allies. Finally, I think we embolden those force elements who are resisting within Bosnia. This would be the message, that we are leaving, categorically, that there will be nothing to replace it, and that idea can only lead to further violence. So I believe the best approach is the one that has been adopted in the second-degree amendment. And that is to, once again, reiterate our strong commitment to a withdrawal date by June 1998, but to give the time--and also to give the impetus--to develop a follow-on force, a non-American follow-on force, and support that force, and to continue to build on the structure of peace that is emerging today and that we hope will continue in the former Yugoslavia. I commend again all of my colleagues who are working on this effort. I yield my time. Mr. FEINGOLD addressed the Chair.

Mr. REED

Mr. REED. I thank the Chair. I rise to support the second-degree amendment offered by the Senator from Michigan on my behalf and on behalf of Senator McCain. I, too, compliment the Senator from Wisconsin for his amendment. One of the great frustrations in watching this policy evolve concerning Bosnia is that I fear we are wasting precious time in taking concrete steps so that we can effectively depart that country in June of 1998. The Senator's amendment has focused this debate and, I hope, gives further impetus to efforts by the administration to take these steps so that the withdrawal of our troops in June of 1998 will be a reality and not a situation where we are victims of a fait accompli and must stay longer. Like my colleague from Michigan, I share the Senator's goal. I believe that we should withdraw our troops by June of 1998. As the Senator from Wisconsin said, there are no good times to leave. In a tumultuous situation like Bosnia, with ethnic rivalries, with violence, with a history of centuries of violence, there are no good times to leave, but we must leave because, as my colleague from Virginia has pointed out, we have already spent $7 billion, and after June 30, 1998, the cost does not go to zero. The costs continue to accumulate. These costs are not just in terms of appropriations for our military forces. They are also in terms of the stress and strain placed on our military forces. There is discussion about mission creep, but I think the first symptom emerging from Bosnia is mission exhaustion as our troops will be forced to be rotated back to that country from their positions in Germany and outside of Bosnia. So for all of these reasons and more, I believe that we should have the requirement to return our troops to their home stations by June of 1998. I just believe that the Feingold amendment is the wrong approach to this situation. It would impose severe conditions on this announced departure date by cutting off funding for the deployment of any ground elements of the Armed Forces except guards at our diplomatic facilities and noncombatant advisers to NATO forces, and this arbitrary restriction could play havoc with our mission and with our troops' ability to carry out that mission. As one consequence, if this provision would pass, it could immediately begin to demoralize our troops. Even though we have set as our objective our departure by June of 1998, passage of this bill cutting off funds would, I think, send a signal that we are not only requesting them to leave but in some respects abandoning them in their operations. I think that is the wrong signal. I know, as the Senator from Wisconsin pointed out, that he, too, shares with me the esteem that we have for the performance of these remarkable soldiers in this operation. Second, I believe that this amendment would weaken the resolve of our NATO colleagues to participate in this mission. I know it has been said on this floor this evening that the Europeans have declared, if you go, we will go. But if we pass this amendment today, any possibility of constructive dialog and engagement to encourage them to stay beyond June will, I think, be totally lost, and that would be a severe gesture. I believe we have to keep this active dialog alive with our European colleagues, and with this amendment tonight, the Feingold amendment, we could very well cut off such dialog. In addition, the Feingold amendment contemplates leaving in place a few Embassy guards and some advisers to NATO. First, if we do construct a follow-on force and if that force is not NATO, this legislation could technically preclude any assistance to a follow-on force, and in that respect I think we are doing ourselves a great disservice, hampering the flexibility of the administration to construct a follow-on force, a constructive military posture in Bosnia after June of 1998. Furthermore, I believe there is a possibility that those forces left behind, Embassy guards or noncombatant advisers, would be placed in a very frustrating position. We are going through a situation where we have significant combat power in-country, with robust rules of engagement, suddenly to a position where American troops are merely, in a way, passive bodyguards for our own military personnel. Their safety could be jeopardized. And, in addition, they would be in the frustrating position of perhaps standing by helplessly when civilians, which we previously protected, could fall victim to the ethnic rivalries which we know exist in that country. I think also one of the detriments and deficiencies in the amendment is it obscures what I think should be the focus of the debate today. We all agree June of 1998 is the appropriate departure date. What we should be debating today on this floor is what steps we must take beginning today to ensure that we can safely and appropriately withdraw our troops by June of 1998. I believe there are several steps that must be taken. Like my colleague from Michigan, I believe we should constitute a follow-on force, but a follow-on force that is not composed of American ground troops. As the Senator from Michigan pointed out, we have the capability through NATO, or through the European security defense identity which would use NATO assets, to provide this follow-on force. Indeed, I think we have to remind Europeans of their brave words back in 1992 in Lisbon when the leaders of the European nations declared that assisting the people of former Yugoslavia in their quest for peace was a test of their ability to establish and maintain peace and security on the Continent of Europe. It is not inappropriate--in fact, I think it is most appropriate--that this situation be returned primarily to the European forces after the intervention of NATO successfully to suppress violence and give them a second chance, give them a second chance to maintain the peace and stability in that region. As we all know, for many years it was a primarily European-led United Nations force, United Nations-protected force that operated within Bosnia. That force was inadequate, but I believe with the intervention of NATO, with the steps we have already taken, a European force could, in fact, and should, in fact, carry out this follow-on mission. I also believe that to augment the European force within the former Yugoslavia, we should, in fact, create a residual force in a nearby country or in the Adriatic, which could respond in a crisis to the legitimate requirements for assistance for this force. In doing those two things, I believe we would, in fact, create a follow-on capability that would preserve the gains we have made in the former Yugoslavia. I believe it is also very important that our administration speak with a very clear voice and a single voice about our intention to depart in June of 1998. It is frustrating when the Secretary of Defense clearly states that deadline, but his words are sometimes confused by ambiguous statements from other leaders of our National Government. I believe we should have one voice, and that one voice should declare that we are leaving in June of 1998. While we go about our military preparations to depart, we have to address the concerns of economic development, and we can do that in a way which favors those parties within the former Yugoslavia, within Bosnia, who are trying to assist in an evolution to a democratic, peaceful society. If we do these things--reconstitute a follow-on force, provide for a residual American force outside of the country that can assist the follow-on force, and begin to support the economic and political development of the people of Bosnia--then I believe that when June of 1998 arrives we can and will successfully remove our forces. But the challenge we face today is not to arbitrarily cut off and terminate funding at this juncture. The challenge we face is to use the intervening months that we have to fashion a policy which will allow us to leave peacefully from the former Yugoslavia, and leave it in a condition where there is hope that the gains we made will be sustained and will be permanent within that country. As a result, I urge my colleagues to support the second-degree amendment and, in doing so, not only send a signal that we are serious about our departure, a signal that will be sent to the capitals of Europe and to the capitals of the former Yugoslavia that we will be serious about our departure date, but we will not be arbitrary and inflexible. And that, in the interim, we will build a structure of peace and security that will carry on the efforts that were so magnificently undertaken and continue today by our military forces in the former Yugoslavia. I yield the remainder of my time.

Mr. REED

Mr. REED. Mr. President, I rise to express my concerns with the tax bill passed by the Finance Committee, and to express my support for the Democratic alternative. I believe the Finance Committee bill is seriously flawed, and will put us on a path to exploding deficits, rising inflation, and future economic hardship. In a time when we are asking our seniors to absorb $115 billion in Medicare cuts, I think it is irresponsible to enact the large, across-the-board tax cuts that are contemplated in this legislation--tax cuts that will add to the pain of balancing the budget by the year 2002. Of particular concern is the fact that these tax cuts will disproportionately benefit the wealthiest Americans who have already benefited from the unprecedented performance of our economy and stock market over the last several years. Specifically, 42.8 percent of the tax cuts will go to the top 10 percent of income earners, those who earn more than $120,000. Meanwhile, only 2.7 percent of the benefits will go to the bottom 40 percent of hard-working Americans. To continue this gravy train for the well-to-do, while ignoring the economic anxieties faced by middle and lower income Americans, is unfair. Nevertheless, the Finance Committee tax bill is loaded with breaks for the wealthiest Americans, leaving the average taxpayer holding the bag. Perhaps most illustrative of this point are three of the plan's largest tax cuts--the capital gains, individual retirement accounts [IRA's], and estate tax provisions. The Joint Tax Committee has estimated that three-quarters of Americans receiving capital gains income have household incomes over $100,000. Similarly, only 1.6 percent of estates are valued high enough to qualify for estate taxes. Finally, increases in the IRA income limitations will benefit only the top 30 percent of taxpayers. As laudable as some of these items are, their combination, without targeting, skews this bill to favor the affluent over middle-income Americans. Beyond favoring the wealthy, the cost of these tax cuts will ultimately threaten the progress we have made on reducing the deficit, which is at its lowest point as a percentage of gross domestic product [GDP] since 1974. This is because the costs of the tax cuts, which are relatively low in the early years, will explode in later years outside of the budget window. For example, from 1997 to 2002, the combined revenue loss of the capital gains, estate tax, and IRA provisions is $4.3 billion. However, the revenue loss from these provisions rises dramatically between 2003 and 2007 to $68.7 billion. In 2007, the combined costs of the capital gains, IRA, and estate tax provisions grow to $18.2 billion. This is 25 times the average annual cost of these provisions of $720 million, as indicated in the Joint Tax Committee distribution tables for 1997 through 2002 for the Republican tax bill. In addition, cuts in the capital gains tax rate will likely generate a flurry of unproductive economic activity that may produce an unwelcome side effect--inflation. Because there are no requirements for reinvestment, a significant share of the capital gains realized will likely be consumed. This increased consumption will put upward pressure on prices and fuel the fires of inflation that we have fought so hard to extinguish. I am supportive of the Democratic alternative because it contains targeted capital gains tax cuts aimed at productive, long-term investment and savings in areas that will best-serve our economy. For example, the bill provides a capital gains reduction for owners of small and startup businesses, which represent the most dynamic sector of the American economy. In addition, the Democratic alternative eliminates IRA provisions in the Finance Committee bill that will lead to dramatic cost increases over time. Moreover, the Democratic bill provides estate tax relief in a manner that will benefit true family- owned businesses and farms that continue to be operated by family members. The child tax credit is yet another example of the distributional unfairness of the Finance Committee legislation. Because the credit is nonrefundable, many middle- and low-income Americans will be unable to take advantage of the child tax credits. It has been estimated that nationwide, 47 percent of all dependent children will be completely ineligible for the $500 tax credit because their incomes are too low. In my State of Rhode Island, almost 141,000 children, or 46 percent of the dependent children in the State will be ineligible for the credit according to Citizens for Tax Justice. The fact that almost half of this Nation's children will be denied the tax credit is of great concern, and further reinforces my support for the Democratic tax alternative, which goes a long way toward solving this problem. The Democratic alternative improves the overall distribution of the tax cut by making the child credit refundable against federal payroll taxes. This is significant because most of the families that would otherwise be ineligible for the credit pay far more in payroll taxes than they do in income taxes. The Democratic alternative would also establish an income limitation on the tax credit to target the benefits to low- and middle-income families that truly need the assistance. Mr. President, in these times of economic prosperity, we can afford to, and indeed we have an obligation to invest in priorities such as education that will have a positive impact on America's future. That is why I have been a strong supporter of the HOPE scholarship tax credit proposed by the President. While I applaud the committee for including education tax credits in their bill, I am concerned about reductions the committee has made in the size of the credit, which will limit its usefulness to many students. For this reason, I believe we should look to the Democratic alternative which allows for the full HOPE credit to be used by students for the first $1,000 in tuition expenses. Additionally, the Democratic alternative establishes a 20 percent tuition deduction that can be used after a student ceases to be eligible for the HOPE credit. Together, these tax credits provide the type of meaningful assistance that many middle-class students will need in order to meet the financial demands of postsecondary education. Also, the Democratic alternative addresses the problem of crumbling schools that threatens our education system at the most fundamental level--elementary and secondary grades. It has been reported that in order to repair the costs of this country's aging schools, we will have to spend at least $4.8 billion. The Democratic alternative takes a step toward addressing this problem by establishing a program to allocate tax credits among the states for the purpose of repairing and constructing school facilities. We cannot hope to improve access and opportunity to higher education, without first ensuring that our elementary and secondary schools provide a physical environment that is conducive to learning. Although hailed as the biggest tax cut since the Reagan era, the Finance Committee bill is perhaps a prelude to the biggest tax increase in our history. This is because the bill is loaded with gimmicks that reduce its costs in the early years, and will result in an exponential rise in costs beyond the 5 year budget window. Assuming that we reach a balanced budget by 2002, this bill will make it virtually impossible to keep our budget in balance, without raising taxes. In addition, the bill assumes that the U.S. economy will remain strong in the future--an assumption that flies in the face of the business cycle. An economic downturn would dramatically increase the costs and eliminate the hope of a balanced budget. The Finance Committee bill will also help those Americans who are least in need of help. The capital gains tax cuts, estate tax cuts, and many of the changes to IRA's will benefit those Americans who have shared most in the economic growth of recent years. I question how we can afford to offer these tax cuts, while asking seniors to pay more for Medicare. Mr. President, as we debate this bill, I ask my colleagues to consider the Democratic tax alternative. This amendment will provide for a fair distribution of the tax cuts and benefit a greater number of Americans. The amendment will eliminate the fiscal time bombs in the Finance Committee bill that will explode after 2002 and threaten our progress toward a balanced budget. Finally, the amendment rightly focuses on the targeted investments necessary to keep our country moving forward into the 21st century.

Mr. REED

Mr. REED. Mr. President, for the past 9 years the visa waiver pilot program has been a resounding success. Today, citizens from twenty-five countries are able to travel to the United States without the burden of obtaining a visa from a U.S. embassy before leaving home. Because the program makes travel so much easier, business has boomed, tourism has soared, and family members have been able to be with each other on occasions when it mattered. Cutting the bureaucratic red tape has strengthened our economic and cultural ties with participating countries. In addition, streamlining this administrative process has enabled the State Department to use its resources more efficiently and effectively, saving the American taxpayers thousands of dollars. Today, I am introducing a bill which will extend the privilege of the visa waiver program to additional countries with strong ties to our Nation. This legislation will slightly modify the criteria that a country must meet in order to participate in the program. Under these modifications, one country which will gain admittance to the visa waiver program is Portugal. Portugal is one of only two members of the European Union which is not included in the visa waiver program. It is time for that inequity to be corrected. The Portuguese were some of the earliest explorers and settlers of the United States and they have been contributing to our country ever since. Over one million U.S. citizens claim Portuguese descent and there are thriving Portuguese communities from New England to Hawaii. We owe these members of our American community the opportunity to see family members who live in Portugal when they need them, without the worry and hassle of obtaining a visa. Inclusion in the visa waiver program will promote the economic exchange between Portugal and the United States. Portugal is a valued trading partner and if members of the business community are able to travel to the U.S. without delaying to obtain a business, their contributions to this country will only increase. At a time when the U.S. economy is the wonder of the world and our market is truly global, our country should seek out and facilitate additional economic opportunities. In 1974, the citizens of Portugal overthrew a dictatorship and established a democracy. Their brave actions began a wave of democratization that spread across the world and is still reverberating today. No other country reflects the principles of the United States better than Portugal. We should do everything possible to lower the barriers and strengthen the exchange between our two countries. Including Portugal in the visa waiver program is an important first step in this process. Mr. President, I ask unanimous consent that a copy of this legislation be included in the Record.

Mr. REED. Mr. President, this week the Senate has considered legislation to fundamentally change Medicare and other programs that are vital to millions of Americans. I realize that we must make difficult choices about these valuable initiatives as we move toward a balanced budget. However, as we seek to invest in our nation's future, we must also confront loopholes and subsidies that waste our limited resources. The tax code contains many such loopholes, which fail to reflect our nation's true priorities. For example, the United States is subsidizing thousands of professional gamblers by allowing tax deductions for gambling losses to the extent of gambling winnings. The Joint Tax Committee reports that this deduction costs taxpayers $1.43 billion over five years. The gambling loss tax deduction is an anomaly for individuals who frequent an industry that sells itself as providing entertainment. In general, the tax code does not allow deductions for discretionary spending on entertainment, and I believe that it is more than reasonable to hold gambling expenditures to this same standard. Repealing the gambling loss tax deduction merely increases the cost of one entertainment option, a factor that gamblers can consider in determining how to spend their discretionary income. Furthermore, while most business deductions are for investments-- and even losses--that could have created needed job opportunities for our nation's citizens, this is not the case for the losses claimed by professional gamblers on their personal income taxes. Perhaps more importantly, the gambling loss tax deduction primarily benefits professional gamblers and wealthy individuals who spend large sums on gambling. In 1994 alone, $2.78 billion in gambling losses was deducted on some 427,000 tax returns. Individuals with adjusted gross incomes of at least $75,000 claimed nearly 55% of these gambling losses, and people with adjusted gross incomes of at least $100,000 claimed an astounding 40% of these deductions. When Congress is cutting essential programs to balance the budget, it is simply unsound policy to subsidize gamblers. I urge my colleagues to join me, Senator Chafee, Senator Coats, and Senator Inhofe in supporting legislation to repeal the gambling loss tax deduction, and in taking a step to ensure that we balance the budget in a way that reflects our nation's priorities and invests in our nation's future. Mr. President, I ask unanimous consent that a copy of this legislation to repeal the gambling loss tax deduction be included in the Record.

Mr. REED. Mr. President, I rise today to pay tribute to Corporal David B. Champagne, USMC, who was posthumously awarded the Medal of Honor for service in Korea. In honor of the sacrifice made by this heroic young man, I am introducing a bill to name the new post office at 551 Kingstown Road in Wakefield, RI the ``David B. Champagne Post Office'' with my Rhode Island colleague Senator Chafee. The son of Mr. and Mrs. Bernard L. Champagne, Corporal Champagne served in the National Guard before graduating from South Kingstown High School and enlisting in the Marines in March 1951. He was the only Rhode Island resident to receive this nation's highest award for valor, the Medal of Honor, for service in Korea. The citation accompanying the Medal read: For conspicuous gallantry and intrepidity at the risk of his life above and beyond the call of duty while serving as a fire team leader of Company A, First Battalion, Seventh Marines, First Marine Division (Reinforced), in action against enemy aggressor forces in Korea on 28 May 1952. Advancing with his platoon in the initial assault of the company against a strongly fortified and heavily defended hill position, Corporal Champagne skillfully led his fire team through a veritable hail of intense enemy machine-gun, small-arms and grenade fire, overrunning trenches and a series of almost impregnable bunker positions before reaching the crest of the hill and placing his men in defensive positions. Suffering a painful leg wound while assisting in repelling the ensuing hostile counterattack, which was launched under cover of a murderous hail of mortar and artillery fire, he steadfastly refused evacuation and fearlessly continued to control his fire team. When the enemy counterattack increased in intensity, and a hostile grenade landed in the midst of the fire team, Corporal Champagne unhesitating seized the deadly missile and hurled it in the direction of the approaching enemy. As the grenade left his hand, it exploded, blowing off his hand and throwing him out of the trench. Mortally wounded by the enemy mortar fire while in this exposed position, Corporal Champagne, by his valiant leadership, fortitude and gallant spirit of self- sacrifice in the face of almost certain death, undoubtedly saved the lives of several of his fellow Marines. His heroic actions served to inspire all who observed him and reflect the highest credit upon himself and the United States Naval Service. He gallantly gave his life for his country. In addition to the Medal of Honor, Corporal Champagne received the Korean Medal of Honor, the Rhode Island Cross, the Purple Heart, the National Defense Service Medal, the Korean Service Medal with 3 Battle Stars, the Korean Presidential Unit Citation, and the United Nation's Service Medal. Corporal Champagne is truly an American hero. In the best spirit of this country, he volunteered to go to a foreign land and fight for people he had never met, so that they would not be subjected to the rule of a totalitarian regime. In my home state of Rhode Island a Korean War Memorial is under construction at the State Veterans' Cemetery. Carved on that memorial will be the same words that are inscribed on the Korean War Memorial dedicated in Washington, DC: ``Freedom Is Not Free.'' Corporal Champagne understood the meaning of those words. He unhesitatingly paid the ultimate price to preserve the freedom of South Korea and to save the lives of his men. This legislation would pay proper tribute to this remarkable young man and commemorate his incredible valor for future generations. I ask my colleagues to join Senator Chafee and me in honoring Corporal David B. Champagne by supporting this bill. Mr. President, I ask unanimous consent that a copy of this legislation to name the new Wakefield post office after Corporal Champagne be included in the Record.

Mr. REED

Mr. REED. Mr. President, I rise today to pay tribute to Corporal David B. Champagne, USMC, who was posthumously awarded the Medal of Honor for service in Korea. In honor of the sacrifice made by this heroic young man, I am introducing a bill to name the new post office at 551 Kingstown Road in Wakefield, RI the ``David B. Champagne Post Office'' with my Rhode Island colleague Senator Chafee. The son of Mr. and Mrs. Bernard L. Champagne, Corporal Champagne served in the National Guard before graduating from South Kingstown High School and enlisting in the Marines in March 1951. He was the only Rhode Island resident to receive this nation's highest award for valor, the Medal of Honor, for service in Korea. The citation accompanying the Medal read: For conspicuous gallantry and intrepidity at the risk of his life above and beyond the call of duty while serving as a fire team leader of Company A, First Battalion, Seventh Marines, First Marine Division (Reinforced), in action against enemy aggressor forces in Korea on 28 May 1952. Advancing with his platoon in the initial assault of the company against a strongly fortified and heavily defended hill position, Corporal Champagne skillfully led his fire team through a veritable hail of intense enemy machine-gun, small-arms and grenade fire, overrunning trenches and a series of almost impregnable bunker positions before reaching the crest of the hill and placing his men in defensive positions. Suffering a painful leg wound while assisting in repelling the ensuing hostile counterattack, which was launched under cover of a murderous hail of mortar and artillery fire, he steadfastly refused evacuation and fearlessly continued to control his fire team. When the enemy counterattack increased in intensity, and a hostile grenade landed in the midst of the fire team, Corporal Champagne unhesitating seized the deadly missile and hurled it in the direction of the approaching enemy. As the grenade left his hand, it exploded, blowing off his hand and throwing him out of the trench. Mortally wounded by the enemy mortar fire while in this exposed position, Corporal Champagne, by his valiant leadership, fortitude and gallant spirit of self- sacrifice in the face of almost certain death, undoubtedly saved the lives of several of his fellow Marines. His heroic actions served to inspire all who observed him and reflect the highest credit upon himself and the United States Naval Service. He gallantly gave his life for his country. In addition to the Medal of Honor, Corporal Champagne received the Korean Medal of Honor, the Rhode Island Cross, the Purple Heart, the National Defense Service Medal, the Korean Service Medal with 3 Battle Stars, the Korean Presidential Unit Citation, and the United Nation's Service Medal. Corporal Champagne is truly an American hero. In the best spirit of this country, he volunteered to go to a foreign land and fight for people he had never met, so that they would not be subjected to the rule of a totalitarian regime. In my home state of Rhode Island a Korean War Memorial is under construction at the State Veterans' Cemetery. Carved on that memorial will be the same words that are inscribed on the Korean War Memorial dedicated in Washington, DC: ``Freedom Is Not Free.'' Corporal Champagne understood the meaning of those words. He unhesitatingly paid the ultimate price to preserve the freedom of South Korea and to save the lives of his men. This legislation would pay proper tribute to this remarkable young man and commemorate his incredible valor for future generations. I ask my colleagues to join Senator Chafee and me in honoring Corporal David B. Champagne by supporting this bill. Mr. President, I ask unanimous consent that a copy of this legislation to name the new Wakefield post office after Corporal Champagne be included in the Record.

Mr. REED

Mr. REED. Mr. President, for the past 9 years the visa waiver pilot program has been a resounding success. Today, citizens from twenty-five countries are able to travel to the United States without the burden of obtaining a visa from a U.S. embassy before leaving home. Because the program makes travel so much easier, business has boomed, tourism has soared, and family members have been able to be with each other on occasions when it mattered. Cutting the bureaucratic red tape has strengthened our economic and cultural ties with participating countries. In addition, streamlining this administrative process has enabled the State Department to use its resources more efficiently and effectively, saving the American taxpayers thousands of dollars. Today, I am introducing a bill which will extend the privilege of the visa waiver program to additional countries with strong ties to our Nation. This legislation will slightly modify the criteria that a country must meet in order to participate in the program. Under these modifications, one country which will gain admittance to the visa waiver program is Portugal. Portugal is one of only two members of the European Union which is not included in the visa waiver program. It is time for that inequity to be corrected. The Portuguese were some of the earliest explorers and settlers of the United States and they have been contributing to our country ever since. Over one million U.S. citizens claim Portuguese descent and there are thriving Portuguese communities from New England to Hawaii. We owe these members of our American community the opportunity to see family members who live in Portugal when they need them, without the worry and hassle of obtaining a visa. Inclusion in the visa waiver program will promote the economic exchange between Portugal and the United States. Portugal is a valued trading partner and if members of the business community are able to travel to the U.S. without delaying to obtain a business, their contributions to this country will only increase. At a time when the U.S. economy is the wonder of the world and our market is truly global, our country should seek out and facilitate additional economic opportunities. In 1974, the citizens of Portugal overthrew a dictatorship and established a democracy. Their brave actions began a wave of democratization that spread across the world and is still reverberating today. No other country reflects the principles of the United States better than Portugal. We should do everything possible to lower the barriers and strengthen the exchange between our two countries. Including Portugal in the visa waiver program is an important first step in this process. Mr. President, I ask unanimous consent that a copy of this legislation be included in the Record.

Mr. REED

Mr. REED. Mr. President, this week the Senate has considered legislation to fundamentally change Medicare and other programs that are vital to millions of Americans. I realize that we must make difficult choices about these valuable initiatives as we move toward a balanced budget. However, as we seek to invest in our nation's future, we must also confront loopholes and subsidies that waste our limited resources. The tax code contains many such loopholes, which fail to reflect our nation's true priorities. For example, the United States is subsidizing thousands of professional gamblers by allowing tax deductions for gambling losses to the extent of gambling winnings. The Joint Tax Committee reports that this deduction costs taxpayers $1.43 billion over five years. The gambling loss tax deduction is an anomaly for individuals who frequent an industry that sells itself as providing entertainment. In general, the tax code does not allow deductions for discretionary spending on entertainment, and I believe that it is more than reasonable to hold gambling expenditures to this same standard. Repealing the gambling loss tax deduction merely increases the cost of one entertainment option, a factor that gamblers can consider in determining how to spend their discretionary income. Furthermore, while most business deductions are for investments-- and even losses--that could have created needed job opportunities for our nation's citizens, this is not the case for the losses claimed by professional gamblers on their personal income taxes. Perhaps more importantly, the gambling loss tax deduction primarily benefits professional gamblers and wealthy individuals who spend large sums on gambling. In 1994 alone, $2.78 billion in gambling losses was deducted on some 427,000 tax returns. Individuals with adjusted gross incomes of at least $75,000 claimed nearly 55% of these gambling losses, and people with adjusted gross incomes of at least $100,000 claimed an astounding 40% of these deductions. When Congress is cutting essential programs to balance the budget, it is simply unsound policy to subsidize gamblers. I urge my colleagues to join me, Senator Chafee, Senator Coats, and Senator Inhofe in supporting legislation to repeal the gambling loss tax deduction, and in taking a step to ensure that we balance the budget in a way that reflects our nation's priorities and invests in our nation's future. Mr. President, I ask unanimous consent that a copy of this legislation to repeal the gambling loss tax deduction be included in the Record.

Mr. REED

Mr. REED. Thank you, Mr. President. My amendment is simply the Finance Committee amendment with the correction of several factors: removal of the Medicare eligibility age, striking the home health care copayment, adds provisions for balanced billing, eliminates the means- testing provisions and also eliminates the medical savings accounts. This is a vote for solvency of the system, restoring those cuts necessary to maintain the system is solvent but rejecting those issues----

Mr. REED. I thank the Senator for his graciousness. Mr. President, my amendment would take the Finance Committee bill with its cuts to Medicare of about $115 billion and simply remove several provisions which I think jeopardize the long-term well-being and health of the Medicare system. These provisions are: raising the age limit to 67; striking the home health care payment; it would add my amendment, the Medicare balanced billing protection; my amendment would also eliminate the provisions that means tests Medicare; and finally, it would eliminate the medical savings account. This amendment would allow the Senate to vote for solvency of the Medicare system but not engage in some of these experiments that are in the Finance Committee bill, experiments which I think will weaken the overall system by driving healthy seniors away from Medicare and leaving the Medicare system to deal with very sick seniors, which is not a way to run a proper insurance program. This measure, I believe, will restore solvency and allow a more comprehensive review of the Medicare system.