Jack Reed

Mr. REED

Mr. REED. Mr. President, I rise today to discuss the state of our economy. Regrettably, the news is not good. Two weeks ago, the Mortgage Bankers Association reported that the rate of home foreclosures and the percentage of loans in foreclosure is at the highest level ever recorded by this organization. At the same time, surveys by the University of Michigan and the Conference Board showed consumer confidence at the lowest levels in many years. The financial troubles that began with the subprime mortgage crisis last summer have now spread to all credit markets and created a liquidity crunch that threatens our entire economy. Some say these troubles are merely temporary. In fact, some say there are two economies--the real economy, with people getting up and going to work, and the economy of Wall Street, which is financial engineering and all sorts of incredibly exotic financial products. The reality is these markets intersect. As a result, our whole economy is threatened now by forces that may be temporary, but they are working themselves out in a very difficult way for the people of this country, the men and women we represent, our constituents. Some contend that the market has undergone a correction since the end of cheap credit and speculation in the housing sector. They point to job figures and quarterly GDP growth as indications that the overall economy, the real economy, is strong. Frankly, I think we have to look critically at those assertions. What troubles me more than the numbers--the GDP and all the other financial statistics--is what I am hearing from Rhode Islanders and what I presume my colleagues are hearing from their constituents across the country. The mortgage crisis and credit crunch in many ways represents a culmination of their fears and sort of the tangible acknowledgement of what they have been fearful of for many months. Lately, I have been struck by how many people are finding it increasingly difficult to maintain a decent standard of living, despite having a steady job. People tell me they feel squeezed by the rising costs of energy, food, health care, and higher education, while at the same time the size of their paychecks does not seem to be expanding at all. For thousand of families in Rhode Island and millions of people across America, wage stagnation has created a general feeling of anxiety. Instead of trying to get ahead, most people are finding it hard to get by. The subprime meltdown and subsequent credit crunch are adding additional stress to that equation. For some people, it has pushed them to the brink of personal and financial crisis. Today, we are living in an era of divided prosperity, where a few do extremely well--extraordinarily well--and the rest of us are struggling to keep up. The Bush administration has aided and accelerated this trend of growing inequality, and its lax attitude toward regulation has allowed major economic liabilities to develop unchecked, allegedly for the sake of allowing the market to function ``efficiently.'' The latest crises show markets are not always efficient, nor always equitable, and rampant speculation in the absence of oversight can create problems that cannot be quickly assessed or fixed. This President has perpetuated a system that encourages a fortunate few to collect as much of the benefits of our economy as possible, while sharing very little with the rest of society. At the same time, what we have seen developing are enormous blind spots that have begun to reveal themselves with disturbing frequency. The tragedies of Katrina and the collapse of the bridge in Minneapolis, as well as the subprime crisis, and even our policies in Iraq are all evidence of the administration's consistent failure to plan for long- term liabilities. Moreover, this shortsighted focus is reflected in massive trade and budget deficits and the absence of any comprehensive plan to address our addiction to foreign oil or the skyrocketing cost of health care. These are creating real challenges for our country. This year, the new majority in Congress has tried to set a different course, but, unfortunately, we have not had the cooperation or support of the President in any real sense of the word. As a result, we have made some progress in addressing and correcting these issues but not nearly enough. In order to end the Bush era of divided prosperity, which some people speak of as two Americas, we have to, I think, reengage ourselves in a process of making sure America is competitive in the global economy and that it has sustainable policies that lead to true growth, which is shared by all Americans. We must reprioritize and take a more serious approach to the policy challenges at hand. Since World War II, every period of economic expansion has resulted in shared prosperity for most America. To be sure, growth varied by degrees over time and from place to place, but in general the tradition in America has been that a rising tide will lift up all boats. Yet for the past 6 years, under the Bush administration, this tradition of shared prosperity has not been sustained. In my State, the Poverty Institute of Rhode Island announced last month that our median wage actually declined since 2000, which makes Rhode Island the only State in New England to experience negative wage growth during this period. With stagnation in most places, we have actually seen negative growth. Since President Bush took office, the real national median household income has declined by $962, from $49,163 in 2000, to $48,201 in 2006. In fact, between the first quarter of 2001 and the third quarter of 2007, real median weekly earnings fell 1.2 percent, compared to 7.1 percent growth between 1996 and 2000 under the Clinton administration. We have seen a startling change in the economy affecting the families of America, whose incomes grew from 1996 to 2000 and have declined in real terms since then, and that reality is shaping the lives of millions of Americans. While the President's economic policy has yielded extraordinary gains at the very top of the income scale, his fiscal policy has multiplied differences and exacerbated the disparity between the very wealthy and, frankly, most everyone else. According to data recently published by the Congressional Budget Office, in 2005, real after-tax incomes jumped by an average of nearly $180,000 for the top 1 percent of households, while rising only $400 for middle-income households, and $200 for lower income households, which signifies an extraordinary divergence in terms of the wealth of the very few versus everyone else. That average income gain for the top 1 percent is more than three times the total income of the average middle-income household. Taken together with prior research, this new data indicates that income is now more concentrated at the top of the income scale than at any time since 1929. I grew up in an era where we looked to the history of the lives of our parents who endured a depression in which the economy collapsed, and then through the policies of this Federal Government and State government, we saw a rising tide literally lift up every family in America. We saw a more equal distribution of wealth. In fact, many people prospered. Now we are seeing a reconcentration of wealth that has great consequences not only for our economy, but for our society. We pride ourselves as Americans on having a country where anyone can rise to the top, where opportunity will propel you forward, take the chances that are available to you. But what we are seeing in other economic studies is, frankly, today we can predict the success of a child based on the income of the parent more than we could 20, 30, and 40 years ago. If your parents are wealthy, you are likely to stay wealthy. That was not the case 20, 30, and 40 years ago. In his new book ``The Squandering of America,'' the economist Robert Kuttner writes: Between 2000 and 2006, the productivity of American workers increased by 19 percent. But the total increases in wages paid to all 124 million non-supervisory workers-- These are the blue-collar workers who come in every day, punch in, work hard, go home, and take care of their families. --was less than $200 million in 6 years--a raise of $1.60 per worker--not $1.60 per hour, but a grand total of one dollar and sixty cents in higher wages per worker over nearly six years . . . Compare this $200 million total for all nonsupervisory workers to the nearly $38 billion paid in bonuses alone by the top Wall Street firms during the same period. That is $38 billion to those people who are extremely successful on Wall Street versus $200 million for every nonsupervisory worker in the country. Since 1997, the pay of CEOs of large corporations has increased to an average of $10.5 billion per year, or about 369 times the average wages of a worker and 821 times the average wage of a minimum wage worker. Such facts make it clear that most Americans are working harder and more productively. Yet these facts go against what many of us were taught in school about the tenets of economics. I am referring to the basic idea that as the economy becomes more productive, those productivity gains are shared, and as a result workers get more in their paychecks. That is not happening. It is not happening as it should. Let me give another example. According to ``Alpha'' magazine and the New York Times, in 2006, the top 25 hedge fund managers combined earned $14 billion. That is enough to pay New York City's 80,000 public schoolteachers for nearly 3 years. Ask yourself: As a matter of social worth and value, should 80,000 public schoolteachers be paid for 3 years with what 25 individuals have earned? I understand there is a risk premium for the pay that these financial managers earn. They are not only talented, dedicated people, but they are also going in there and taking chances and rolling the dice and creating innovation, entrepreneurship, and opportunities for others. But still I must ask: Is this distribution of wealth and reward commensurate with all the efforts of those teachers, men and women in urban school districts who are laboring to give kids a chance so they can seize opportunities? As Americans, we have to stop and ask ourselves why is this happening. Is there something we can and must do to make this country a little bit fairer? Even some billionaires are concerned about this. Warren Buffett has criticized the U.S. tax system for allowing him to pay a lower rate than his secretary. Mr. Buffett paid 17.7 percent on the $46 million he made last year. He did not try to avoid paying higher taxes, he simply took the advantages that were in the tax code to which he--indeed, to which each of us--is entitled. Meanwhile his secretary, who earns $60,000, was taxed at 30 percent. If you consider these inequities, these differences, it is hard to understand why the President is so adamant about protecting the tax rates for the top 1 percent of earners. The consequence of this is that we also have fiscal complications. We have the most rapid deterioration of our Nation's fiscal health in the history of this country. In this administration, we have swung from a projected surplus to a projected deficit dramatically. When the President took office, we had a surplus. Yet he has run a budget deficit every year for the past 6 years. Over that period of time, Bush's deficit spending has increased our national debt to nearly $9 trillion, which is virtually $30,000 for every man, woman, and child in America. He has pushed this country into record levels of debt to finance tax cuts for individuals who, frankly, are earning at a level at which they do not need additional tax cuts. Not only does it give more to those who already have a great deal, it also starves the Government from funds to use for investing in the future productivity and prosperity of this country. The only areas where the President has consistently supported more money have been for his tax cuts and for unlimited spending on his policy in Iraq. With these items, there is no limit to what he will accept. A recent report released by the Joint Economic Committee estimates that the total economic cost of the war in Iraq has been approximately double the direct budgetary costs. We have been spending billions, but the costs are much more than that. As we look to a drawdown of our troops going forward, the JEC estimates that the total economic cost of the war will reach $2.8 trillion for the entire 2003- to-2007 period, when you factor in veterans health care, the cost of equipping and replacing the materiel we have consumed in this war, and the reinvestments we will need to make in our military. It is a huge amount of money. We are spending $10 billion per month on Iraq. Just 2 months of the cost of that war is roughly the same amount that was at issue between the President and the Congress in our debate about the budget this year. The President refused to spend $22 billion more than his limit on domestic spending, but in 2 months, we will consume at least that much in Iraq without any revenue offsets, without any qualms, and without any additional considerations. Unconditional spending was the message he sent to us last evening when he demanded that this Congress send him money for Iraq. The President's policy seems to be not guns and butter but guns and caviar--money for Iraq, money for Afghanistan without limit, without end, it appears, and benefits through the tax system for the very wealthiest Americans, not the rich, but the super-rich. This year, the Government is effectively spending $49 billion to provide tax breaks averaging $130,000 for those with incomes greater than $1 million. And we are seeing the impact throughout this country. We particularly see it as we go back to what has to be, I believe, the reference point for what we all do, and that is, what is happening to families across this country. In Rhode Island, the cost of health care premiums is rising twice as fast as wages and inflation. Premiums in Rhode Island increased 67 percent between 2001 and 2006. Wages did not increase that fast, I can tell you that. The number of people without insurance increased 50 percent in that same period. They cannot afford to pay for the cost of insurance. Gas prices have more than doubled in Rhode Island. The price of regular gas has jumped 95 percent from $1.52 when President Bush took office to about $2.97 in June of 2007. People are spending more and more money on getting to work, getting the kids to the Little League games. College education costs are rising in Rhode Island and across the country. Average tuition fees in Rhode Island have increased 6 percent for our 4-year public colleges and 5 percent for our private colleges. At the same time, the value of a home has been decreasing, and people are beginning to sense that decrease. A home used to be the great source of economic security, economic wealth, economic flexibility, and a hedge against the uncertainty of the economy, but now we are seeing in Rhode Island, and indeed across America, an explosion in foreclosures. And we can also factor in the uncertainty of pensions. The fact is that more and more of my constituents are being pushed from a defined benefit to a defined contribution plan or in some cases to no pension at all. The erosion of traditional pensions is adding to this uncertainty. The net effect of all of this is that many Rhode Islanders are working longer hours but are barely able to maintain the same standard of living. What we have to do is respond to these issues. We have taken some steps. We have passed, in terms of education, the College Cost Reduction Act. This $20 billion increase in student aid is the result of this Democratic Congress and our priorities, but we have to do much more. We have moved forward with respect to some issues on housing, but progress has come much too late and is still too little. We finally cleared the Federal Housing Administration Modernization Act, the FHA Act, which is going to increase the amount of loans the FHA can guarantee. That is going to get them back into the lending business. But this action has come months after we should have moved more promptly, more efficiently, more effectively to do that. We have to respond to this growing crisis now in terms of foreclosures. Secretary Paulson announced his plans recently and I think the plans are important because at least they signal some action. However, I suspect they are probably inadequate for the scope of the problem that is developing. We have legislation that is pending that has to be moved that I think will be much more effective going forward. On energy, this week, the President is signing an energy bill which is long overdue. It increases gas mileage, or CAFE, standards. But we have to do more there, too. The tax provisions which are so essential, I think, to ensuring that there are incentives for alternate fuels, incentives in the marketplace so investors will put in money with the confidence that they will be repaid, those tax incentives are still languishing. They have to be passed. Again, we have made progress, but it has not been adequate progress to date. We have to deal with the broader sense of our dependency on oil. Again, this energy bill is a very good step forward. It has to be supported. It has to be advanced. It has to be extended. When we look at the economy from the standpoint not of the macroeconomic statistics of gross domestic product, when we look at the economy not simply in the context of financial markets, when we look at the economy from the standpoint of people who live in Harrisville, RI, or Harrisburg, PA, it is a tough economy. People at home are asking us to stand up and do something, to give them again the sense that when they work and their productivity goes up, their wages will go up as well; to give them the sense that they can actually provide for their family, maybe even put a little bit aside. Very few middle-income people are putting anything aside these days. That is our challenge. This Congress has taken some steps to meet that challenge in terms of education policy, in terms of energy policy, in terms of at least beginning to deal with the housing issue. We have a lot more to do, and we need the cooperation of the administration. I think this is a historic moment. Are we going to abandon our sense that this country is based on opportunity for all of our citizens? Are we going to abandon the sense that our economy works for all of its citizens; that those who are creative and clever and take risks will get great rewards but that no one is going to be left behind, no one is going to be left without anything to show for working hard, working smarter, and working better? I hope not. I think that will be one of the ultimate judgments not just on this Congress and this administration but on our tenure as Members of the Senate as we go forth. Mr. President, I thank the Chair for his consideration in allowing me to speak beyond the recess time, and I yield the floor.

Mr. REED

Mr. REED. Thank you, Mr. President. First, let me thank the majority leader for arranging this time.

Mr. REED

Mr. REED. Mr. President, Senator Levin has very eloquently pointed out the premise of the President's surge strategy; that was to provide the political space so that the Iraqi Government could essentially begin a reconciliation among its own people, begin to function effectively. Little or none of that has happened. What has happened is that the violence has been reduced. That is commendable. It is attributable to several factors; first, the increase of American forces there and the way they have been deployed very adroitly by our military commanders; secondly, the fact that coincidentally but propitiously in Anbar Province, Sunni tribesmen have finally figured out that al-Qaida is as much a threat to them as to anyone else, particularly Americans. They have banded together with us to attack al-Qaida elements there. How long that relationship of convenience lasts is a question that has not been resolved. Within Baghdad, there has been significant ethnic cleansing. In fact, we recall just weeks ago, refugees started coming back. They were told by the Government in Baghdad: Do not come back. You are going to provoke another destabilizing situation. That ethnic cleansing is one other factor. Sadr, the leader of the Shia in the South, one of the purported leaders in the South, has basically told his Mahdi army to stand down for 6 months so he can reorganize, so he can regroup, so when he feels the moment is right he is in a much more powerful position to strike. Then the administration has finally embraced some diplomatic efforts; quietly, I think, with the Iranians, much more publicly with the Syrians and others. All of those factors together have contributed to this reduced violence. But here is one of the most significant and salient facts we have to recognize: The surge is over. Our force structure will not allow a continuation of 160,000 American forces in Iraq beyond the middle of this year, beyond this summer. That is not because some politician in Washington said so, that is because the Chairman of the Joint Chiefs of Staff, because the Chief of Staff of the Army understand that the operational tempo will not allow that. The question before us is: Well, what is the strategy now? Is the strategy coming here and asking for billions of dollars every 3 or 4 months? Asking for troops that cannot be actively or effectively provided, because our force structure is too small? The essence of this amendment, an amendment that Senator Levin and I and others have been pursuing for months now, is to focus on a strategy that can be sustained and supported so we can do what we must do. That strategy, in our view, boils down to three very specific missions: Go after the terrorists, the al-Qaida people, wherever they are; train Iraqi security forces to support their country, because ultimately the Iraqi people and their leaders will decide whether their country will survive and prosper, not American forces; and, finally, protect our forces on the ground. Those are three discrete missions that can be done, should be done. There is no attempt in this amendment to cut off funding. There is an attempt, though, to focus our policy on a strategy that will work over time. What we have here is no simple situation in which you have got an al-Qaida rogue group we are going after. This is a very complicated situation. Ultimately at the heart of this, it is a political struggle between Sunni, Shia, and Kurds; Sunnis, who feel a profound sense of entitlement which has been frustrated by our operations over there, and the departure of the Baathist regime; Shia, who feel profoundly paranoid because they suffered grievously under that regime; and Kurds, who want their autonomy. These political forces have to be settled. They will only be settled internally by the Iraqis standing up. This amendment will help direct that policy, force them to recognize we are not there indefinitely with a blank check. It will also guide our forces to missions that we can perform, that will be essential to our security and will allow us, I believe, to do what we can to help that country stabilize itself. This is a message. It is a message to the troops that we are going to adopt a wise, sustainable policy that is worthy of their sacrifice. It is a message, I hope, to the President that he cannot come back here every 6 months and ask for 5, 10, 50, 70, 80, $100 billion. It is a message to the Iraqi politicians that they must seize this moment. I urge passage.

Mr. REED

Mr. REED. Mr. President, I ask unanimous consent that a fellow in my office, Louis Bervid, be granted floor privileges for the remainder of this session.

Mr. REED

Mr. REED. Mr. President, I rise to pay tribute to an outstanding Rhode Islander and a superb employee of the Senate who is retiring after 34 years of Federal service--my friend, my colleague, someone I admire immensely, Dennis P. Riley. Dennis Riley has worked in my Providence office since I was elected to the Senate. But before that, he was a longtime employee of Senator Claiborne Pell, my predecessor. Dennis was born in Pawtucket, RI, on March 3, 1948, and attended St. Raphael's Academy. He went on to earn a bachelor of science in history and political science at the University of Wisconsin in 1971. He taught history for a brief time in the Pawtucket School System and was a graduate student in the Masters in Teaching Program at Rhode Island College. In 1972, he became the field coordinator for U.S. Senator Claiborne Pell's reelection campaign and formed a bond with Senator Pell and public service that lasts to this day. Dennis came to serve on the personal staff of Senator Pell, first as a staff assistant in Washington, DC, from 1973 to 1978. But in recognition of those skills and the commitment he brought to bear as a staff member for Senator Pell, Senator Pell chose Dennis to serve as his campaign manager for his next successful reelection effort. So Dennis returned to Rhode Island and successfully planned and executed the Senator's reelection campaign. From 1979 to Senator Pell's final day in office, Dennis worked as assistant director of the Senator's Rhode Island office. He was a trusted employee of Senator Pell, and, more importantly, Dennis remains close to the Pell family today. As Senator from 1961 to 1997, Senator Claiborne Pell's legacy includes establishing Pell grants as well as creating the National Endowment for the Arts and the National Endowment for the Humanities. Senator Pell was also noted as a diplomat, and he served with distinction as chairman of the Foreign Relations Committee. Senator Pell's legacy is a model for all of us, particularly for myself. Dennis Riley is a testament and a part of that tradition of talented and conscientious public servants who labor, perhaps in the shadows, but it is their work that is decisive in our success on the floor. After Senator Pell retired, and the people of Rhode Island gave me the chance to continue his good works, Senator Pell spoke so highly of Dennis that I asked him to join my staff. It is one of the best decisions I have ever made. He brought with him a keen knowledge of the workings of the Senate, a history and knowledge of Rhode Island politics, good judgment, great wisdom, and great character. In the ensuing years, we have become dear friends, and he is a trusted adviser. During his tenure with my office, Dennis has worked on special projects and has assisted hundreds of agencies and organizations as they sought Federal assistance and thousands of Rhode Islanders who needed help, who needed someone to listen to their stories, and to let them know there is a government that cares about them, because Dennis Riley is a person who cares deeply, not just about Government but about the people we serve. In Rhode Island, he has been involved in crafting many public policy initiatives, and he has been particularly active as my point person on Federal grants and the applications process for the Appropriations Committee. He has shepherded projects through. He has brought people together for the common good. He has made a significant impact on the economic vitality of my State. Although Dennis's name will never be lauded in the news reports or press releases, his hand is seen in so many efforts to make our State an even better place to live, work, and raise our families. Everyone who knows Dennis sees him as a kind and decent man, with a great heart, a great mind--someone we are proud to call a dear friend. His compassion and quick Irish wit are legendary. For years, transplanted Rhode Islanders in Washington, DC, and politicos in our State eagerly awaited, every day, the ``Riley Report''--a carefully crafted summary of the day's topical stories, political news, and a retelling of the events of the day in Rhode Island. This complete and unbiased commentary of the author provided the ``real story,'' very often, of what was going on in Rhode Island. Well, after his distinguished service to the Senate for 34 years, Dennis now will be retiring to his beloved home in Little Compton, RI, with his wife--the love of his life--Kathy McLaughlin Riley. Kathy is a warm and lovely person, who has devoted her life to educating children. She is an elementary teacher at the Elizabeth Baldwin School in Pawtucket, and she will soon join Dennis in retirement. In their well-deserved retirement, Dennis and Kathy plan to travel extensively. They are avid baseball enthusiasts, and they plan to visit all the ballparks they have not yet seen. It will be an inspiring and interesting trip for both of them. He will also be spending time caring for his family, including creating more memories with his many nieces and nephews who so treasure his company. I wish both Kathy and Dennis much happiness and fulfillment in the years ahead. Now, on behalf of myself--and also I will take the liberty to speak on behalf of my esteemed predecessor, Senator Claiborne Pell--I would ask all my colleagues in the Senate, who treasure, as I do, the loyalty and the devotion of their staffs, to join me in paying tribute to a stellar Senate employee, Dennis Riley. Rhode Island has been honored by his service, and the Reed staff will fondly remember his time with them. We formed a lasting bond that will never be severed, and we treasure that bond. As Dennis files the final ``Riley Report,'' I wish him every good wish. Now, Dennis is Irish, and that means he has a rather somber view of the world. He has a saying on his office door that reads: ``There is nothing so bad that it can't get worse.'' That is a typically Irish sentiment. As we send him off, however, let me offer another sentiment. Dennis: May the saddest day of your future be no worse Than the happiest day of your past. Thank you for your friendship, and thank you for your service. Mr. President, I yield the floor.

Mr. REED

Mr. REED. First, I thank the Senator from Michigan for her kind words and also for her tremendous leadership as the leader of our Democratic caucus on so many issues, and a great representative of her State of Michigan. I thank the Senator. Today, Mr. President, the Bush administration announced a proposal to help stem the burgeoning crisis in foreclosures across this country. It is a welcome step, but it is a very timid step. It is one that is long overdue, in my estimation. This crisis has been evolving over many months, and the White House and the Treasury have taken a very long time to get to this moment and to propose this plan. And it is cautious plan, and only a partial approach to a very complicated and very dangerous problem. The problem is dangerous in the sense that millions of American homeowners are facing the peril of losing their homes to foreclosure because of the exotic mortgages that were sold to them with low introductory rates and now are being triggered to reset to relatively high rates, forcing many people to make the choice between giving up their home or giving up everything else to pay for their mortgage. That is the human aspect. And we are seeing it in our home State of Rhode Island, Mr. President, a record number of foreclosures, page after page in the newspaper of homes that are going to be foreclosed upon. This has an effect not only on the individual family but on the community as a whole because as homes are foreclosed in a neighborhood, they lower the value of the other homes. It has a ripple effect. I was meeting just a few weeks ago with the mayor of Central Falls, RI, who pointed out the increased number of foreclosed homes in his community, and also the mayor of Pawtucket, who has seen a significant increase in foreclosures. This goes right to the fabric of a community. So on the individual family level, on a community level, and now on a nationwide, indeed, global level, this liquidity crisis, this crisis in credit, is threatening the ability of our economy to function efficiently, to provide resources, credit, and loans not just to homeowners, but to industry and business as well. So the White House acted today, and I applaud their action, but it is timid. The proposed plan will only address a very small fraction of the foreclosure problem, and the Administration has yet to talk about and deal with the larger issues of economic growth and continuing an adequate supply of credit in our economy. According to Treasury officials, and an analysis that has been done by financial institutions, this initiative will help about 200,000 people. But the reality is there are millions of Americans who are facing the danger of foreclosure. This 200,000 is just a small fraction. It is better than zero, which was the President and the administration's position just a couple of months ago as they worked on this, but it is not adequate to the daunting challenge of the foreclosure crisis which is facing America today. Indeed, the plan itself relies on a very complicated and, indeed, convoluted process. There are two classes of inquiry. First, they have to determine if the borrower is eligible for this relief, and then they have to go through another analysis to determine what type of relief the borrower would be eligible for. In addition, it appears the borrower is in the position of having to contact their lender or servicer if they would like to figure out if they are eligible for a loan modification. This is not the responsibility of the lender or servicer. In other words, this is not a systematic approach to relief. This is rather a case by case approach, involving very elaborate procedures which I don't think will in effect reach all the eligible homeowners who are in danger of losing their homes. I think this approach is backwards. It should be the obligation of the lenders and servicers to reach out to the borrowers who are in danger of default, to help walk them through the process. And it should be a much more efficient process. Today the President offered an 800 number to borrowers, but there are a profusion of 800 numbers, all the way from buying a salad maker to buying an exercise machine. I don't think an 800 number is going to be able to engage people who are fearful about losing their homes and actually get them involved in this process and keep them involved. So I think this is a shortcoming in the approach, which is already a limited approach. Finally, this plan has not been ratified and accepted enthusiastically by all of the important investors and the other industry players. The final plan was characterized as an agreement with the HOPE NOW industry coalition. This coalition consists mainly of trade groups and has no real ability to implement the plan. They are not the spokesperson for all of the people who will actually have to do the work, and the list of members seems to be a partial list at best. So for many reasons this plan is really just a set of guidelines regarding how the Administration would like to see part of this problem worked out but does not have the action-forcing devices and the incentives for the servicers, the lenders, and all of the people who really can make this work to go out and put it into effect. We need to do much more, and there are several things we should do. We need to do much more because this is a burgeoning crisis. I can recall last April convening a committee meeting, as I chair the Subcommittee on Securities, Insurance and Investment, and we had witnesses from some of the major investment banks in New York City and the rating agencies. We had individuals who were facing the problem of foreclosure, and at that point industry was describing this as a rather narrow, self-contained crisis pertaining only to subprime mortgages. They talked in terms of this being about a $19 billion problem, which in a worldwide economy is not a staggering amount of money. It is to you and I, but not in a worldwide economy. And they also essentially said, well, this is over. The market has already corrected itself. It is not over. It is now spilling over into other forms of securities. It is now eroding, as I suggested initially, because of psychological factors as well as financial factors, confidence in the overall banking system and the economy's ability to function. In the newly released Mortgage Bankers Association National Delinquency Survey, the rate of loans entering the foreclosure process was approximately .78 percent. That is up 32 basis points from 1 year ago. This is a problem that is growing. This is not at all a self- contained problem. This is a growing problem. This is the highest rate of loans entering foreclosure ever recorded in this survey--ever recorded, going back many years. So this is not only an increasing problem, it is a significant problem in our economy and in the lives of Americans everywhere. The percentage of loans actually in the foreclosure process also increased to 1.69 percent, which is also the highest level ever recorded. In Rhode Island, we have the dubious distinction, Mr. President, of the highest foreclosure rates in New England. The percent of loans that were seriously delinquent or in the process of foreclosure in the third quarter of this year was 3.23 percent, and the percent of subprime loans in this category was 14.97 percent. So for our own home State, we are seeing an explosion of these foreclosures. We are also seeing, simultaneously, the largest price declines in the housing sector since the Great Depression. Not only are people losing their homes, but those who are still paying their monthly mortgages are seeing the value of their homes diminish significantly. For so many people, that was their whole source of wealth. In fact, I would suggest that it was one of the major reasons that consumption and consumer activity were so robust over the last several years. As energy prices went up, as other factors intervened, what kept consumers in the game was this notion they were wealthy because their house was appreciating every year. That has changed, and that will have an effect. At least one housing expert I talked to thinks this housing downturn is going to be one of the longest we have experienced in the last 50 years. Instead of lasting an average of 24 months, he expects it to last up to 48 months, which would take us to at least 2 years from now. What we know now is that the banks and the rating agencies underestimated the underlying risk in many of the financial products offered to home buyers, and their actions have resulted in serious consequences to the availability of credit and to the capital markets in both our economy and the worldwide economy. What started out as a problem centered on subprime loans has spread to other parts of the market and the economy. And there need to be serious policy recommendations to address these problems as well. Now, what we have to do is a series of steps, none of which is the magic solution, but they are all collectively important. We cannot stop today with the announcement by the administration. Secretary Paulson himself has urged Congress to pass the FHA Modernization Act. The administration should take the next logical step and not simply be cheering from the sidelines, but get in the fight and encourage those in this body who are holding up that FHA bill to let it go. Words are important, but deeds are more telling. So if the Secretary is truly interested in getting that bill moving, he needs to come up here and be talking to the members of the Republican caucus who are holding up this bill. We also need the administration's leadership in passing bankruptcy reform. Senator Durbin has an excellent bill that will allow borrowers and lenders to renegotiate the terms of their mortgages so that people can stay in their homes as part of a bankruptcy proceeding. We need Tax Code changes so that borrowers would not pay Federal taxes on the debt discharged by lenders on their home mortgages the so- called short sale. There are some people who recognize they can't keep their home. They can sell the home at a loss, and with an agreement from the lender at a price less than the value of their mortgage. The lender takes this discharge as a loss, and the IRS, under current tax law, determines that this is income for the borrower and taxes it. We need to change that. In fact, Senator Stabenow has a bill to do just that, and it was part of the proposal that Senator Baucus offered earlier today in conjunction with AMT. Finally, I think we have to have a substantial increase in the availability of housing counseling, and this is included in the bill I introduced, called the HOPE Act. An increase in housing counseling funds is also in the appropriations for Transportation, Housing, and other agencies bill which has received a veto threat from the President. In the HOPE Act, I also have suggested that we include mandatory loss mitigation requirements; that a lender has the obligation to work with a borrower to see if there is a way to avoid foreclosure if it is economically feasible to do so. We need to work together--the Congress, the administration, the regulators, and the industry--toward the goal of keeping American families in their homes, and we also have to recognize that if we don't act coherently, comprehensively, and in a timely fashion, what presented as a small subprime loan crisis and has burgeoned into a national foreclosure crisis could undermine economic progress in this country and maybe across the globe. Time is wasting. We have to move forward. I urge my colleagues to do so. Mr. President, I yield the floor.

Mr. REED

Mr. REED. Mr. President, I request 5 minutes.

Mr. REED. Mr. President, how much time remains on the Democratic side?

Mr. REED. Mr. President, today we face an opportunity to change the course and the direction of our policy in Iraq. The other body, the House of Representatives, has sent a provision--a bridge appropriations supplemental--to us, which includes language that would change this policy. It would change our missions, it would establish a goal to complete the transition to this new mission by the end of next year, and it would invest resources, energy, and effort in diplomacy as well as military activity. I think it is critical to do that. We have, for the last several months, seen an increase in American forces on the ground, and the sheer presence and effectiveness of American forces has created some tactical momentum in terms of the security situation. But the fundamental challenge remains to get the policy right in Iraq, and that is the responsibility of the Government of Iraq. In January of this year, 2007, the President announced his surge and he said: I have made it clear to the prime minister and Iraq's other leaders that America's commitment is not open-ended. If the Iraqi government does not follow through on its promises, it will lose the support of the American people and it will lose the support of the Iraqi people. Well, those individuals in this body who oppose the House provision, the changed missions, are essentially declaring that there is an open- ended commitment; that we will not condition our resources and our effort in Iraq. I think that is wrong. And, in fact, it is wrong because what has been acknowledged over the last several days is the fact that the Iraqi political leaders have not seized on the situation in Iraq. They have not followed through. The President proposed his surge because he thought the Government of Iraq would have the breathing space it needed to make progress in other critical areas. No such significant progress has been made. Yesterday, on the front page of The Washington Post, Tom Ricks wrote: Senior military commanders here now portray the intransigence of Iraq's Shiite-dominated government as the key threat facing the U.S. effort in Iraq, rather than al-Qaida terrorists, Sunni insurgents, or Iranian-backed militias. General Odierno, our tactical commander, the corps commander, indicated if that doesn't happen--i.e., the Government taking charge-- we are going to have to review our strategy. Well, that is not taking place. We have to review our strategy. Indeed, we have to change our strategy. We have to have a strategy with limited missions, counterterrorism, force protection, training Iraqi security forces. Those are the missions embedded in the supplemental bridge legislation passed by the House. Those are the missions we should pursue. Those are the missions that are essential to our security. The Iraqi people, the Iraqi Government, must solve their own internal problems. We have given them space. They have not used it. Now we must seize on those mission which will protect the United States without an open-ended, unlimited commitment of our forces and our resources. I urge that all of our colleagues join together in a bipartisan fashion and strongly support the supplemental bridge legislation proposed by the House, including conditions which are essential to our progress forward in Iraq. I yield the floor.

Mr. REED

Mr. REED. Mr. President, I strongly support H.R. 1429, the Improving Head Start for School Readiness Act of 2007. This important bipartisan legislation, which I helped craft as a member of the Senate Education Committee and as a conferee, reauthorizes the Head Start Act for the first time since 1998 and strengthens our commitment to ensuring that the nation's neediest children receive high-quality early education supports and services. Since 1965, Head Start has provided comprehensive early childhood development, educational, health, nutritional, social and other services to low-income preschool children and their families, and this reauthorization builds on our long-standing investment in this essential initiative. There are two provisions that I am particularly pleased are included in this legislation, and which are important to my State of Rhode Island. First, the Improving Head Start for School Readiness Act builds on provisions I first authored in 2003 to provide Head Start programs with additional flexibility to serve children up to 130 percent of poverty. Current law limits program eligibility to 100 percent of poverty or below. This increase in income eligibility will enhance the opportunity for struggling, low-income families to participate in Head Start while ensuring that programs prioritize serving families under the poverty guideline and enhance outreach to ensure those most in need are served first. Raising the income eligibility limit finally puts Head Start on the same level as other means-tested programs, which essentially all serve above the poverty level to provide for greater participation and help the working poor. Second, this legislation for the first time establishes the Parent Policy Council as a decisionmaking authority within the governing structure of Head Start programs. Strong parent involvement in their children's early education and development has been a key tenet of the Head Start program since its inception in 1965, and is one of the primary reasons for the program's continuing success. This reauthorization also includes a provision I authored to enhance coordination between Head Start programs and school and public libraries to excite children about the world of books, assist in literacy training for Head Start teachers, and support parents and other caregivers in literacy efforts. Additionally, I am pleased that this conference report does not permit employment discrimination based on religion despite the administration's continuing advocacy for such a change. Faith-based organizations are an integral part of Head Start. However, there is no need to change a program that has encouraged their participation by allowing such discrimination. I want to thank Chairmen Kennedy, Dodd, and Miller and Ranking Members Enzi, Alexander, and McKeon and their staffs, for their extraordinary work on this conference report. The Improving Head Start for School Readiness Act is significant legislation for the people of Rhode Island and the nation, and I am pleased to support it. This strong reauthorization in tandem with necessary funding increases will ensure that Head Start can continue its important and critical work to lessen the effects of poverty and ensure that children are successfully prepared for school and life.

Mr. REED

Mr. REED. Mr. President, today I introduce the Real Estate Transparency Act of 2007. This bill would amend the Real Estate Settlement Practices Act of 1974 to improve the early loan disclosures given to those applying for a mortgage, ensure binding and transparent payment agreements between mortgage originators and borrowers, and require that a borrower be given a copy of their final settlement statement at least one business day before settlement so that it can be thoroughly examined before closing. As we are all too aware, current Good Faith Estimates do not provide enough useful information to help borrowers truly make informed lending decisions. We have heard too many stories of borrowers not understanding the terms of their loan or not being told about unexpectedly high settlement fees until they are at the closing table. This lack of early and appropriate disclosures regarding the terms of a mortgage loan and the costs of closing on that loan hinders a family's ability to shop for the best loan product for the purchase of a home, and also has allowed families to be taken advantage of by unscrupulous brokers and lenders. First and foremost, the Real Estate Transparency Act would replace the current Good Faith Estimate with an early written settlement statement of all of the costs to be charged to that person at or before settlement of the loan. It would require that this early settlement statement be in the same form as the final settlement statement, currently known as the HUD 1. The borrower would not be liable for any fees which are not disclosed on this early settlement statement, except for third party fees within 10 percent of the cost listed on the early settlement statement, or fees for bona fide and reasonable expenses not anticipated by the mortgage originator for an inspection, appraisal, survey, or flood certification. This early written settlement statement should allow consumers to compare the costs associated with different loan products from different mortgage originators and shop around for the best product for them early in the process. Second, this legislation would require for the first time that the HUD 1 or final settlement statement be provided to the borrower at least one business day before settlement. If this final settlement statement is not provided to the borrower, then lenders will be subject to statutory damages. Third, this bill would require mortgage originators to provide borrowers with a written agreement itemizing all of the fees they may charge the borrower, including any origination fees, underwriting fees, broker fees, or other fees to be charged at or before settlement of such loan to be paid to the lender, the broker, or affiliates of the lender or broker. In addition, this written agreement would have to set out and explain three possible methods of payment for such fees: payment in cash before or at settlement; adding such fees into the loan amount to be borrowed; and increasing the interest rate of the loan. The borrower also could choose to both pay in cash and incorporate some of the fees into the loan amount. This written agreement regarding mortgage origination fees would have to be provided to the borrower within three days of application and be signed before the borrower is obligated to pay any of these fees. Not only should this provide greater transparency regarding what fees are going to be charged by the mortgage originator, consumers also can decide not to sign on the dotted line if they do not like the costs associated with the loan. Finally, the bill subjects mortgage originators to statutory damages for violations of these disclosure provisions equal to the sum of the borrower's actual damages plus $5,000 for each instance such instance of noncompliance. Congress needs to take many steps to address the subprime mortgage crisis and to reinstate confidence among our nation's homeowners and those we hope will become homeowners. I believe that giving consumers the information they need regarding their loan costs is a vital part of improving this complicated and often overwhelming process. Borrowers need to better understand the financial ramifications of choosing a certain loan product from a certain mortgage originator early in this process, and before they actually consummate the loan. I hope my colleagues will join with me in supporting this legislation that I believe will greatly improve mortgage loan disclosures. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. REED

Mr. REED. Mr. President, I ask unanimous consent to speak for up to 10 minutes in morning business.

Mr. REED. Thank you, Mr. President.

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

Mr. REED

Mr. REED. Mr. President, today I introduce the Real Estate Transparency Act of 2007. This bill would amend the Real Estate Settlement Practices Act of 1974 to improve the early loan disclosures given to those applying for a mortgage, ensure binding and transparent payment agreements between mortgage originators and borrowers, and require that a borrower be given a copy of their final settlement statement at least one business day before settlement so that it can be thoroughly examined before closing. As we are all too aware, current Good Faith Estimates do not provide enough useful information to help borrowers truly make informed lending decisions. We have heard too many stories of borrowers not understanding the terms of their loan or not being told about unexpectedly high settlement fees until they are at the closing table. This lack of early and appropriate disclosures regarding the terms of a mortgage loan and the costs of closing on that loan hinders a family's ability to shop for the best loan product for the purchase of a home, and also has allowed families to be taken advantage of by unscrupulous brokers and lenders. First and foremost, the Real Estate Transparency Act would replace the current Good Faith Estimate with an early written settlement statement of all of the costs to be charged to that person at or before settlement of the loan. It would require that this early settlement statement be in the same form as the final settlement statement, currently known as the HUD 1. The borrower would not be liable for any fees which are not disclosed on this early settlement statement, except for third party fees within 10 percent of the cost listed on the early settlement statement, or fees for bona fide and reasonable expenses not anticipated by the mortgage originator for an inspection, appraisal, survey, or flood certification. This early written settlement statement should allow consumers to compare the costs associated with different loan products from different mortgage originators and shop around for the best product for them early in the process. Second, this legislation would require for the first time that the HUD 1 or final settlement statement be provided to the borrower at least one business day before settlement. If this final settlement statement is not provided to the borrower, then lenders will be subject to statutory damages. Third, this bill would require mortgage originators to provide borrowers with a written agreement itemizing all of the fees they may charge the borrower, including any origination fees, underwriting fees, broker fees, or other fees to be charged at or before settlement of such loan to be paid to the lender, the broker, or affiliates of the lender or broker. In addition, this written agreement would have to set out and explain three possible methods of payment for such fees: payment in cash before or at settlement; adding such fees into the loan amount to be borrowed; and increasing the interest rate of the loan. The borrower also could choose to both pay in cash and incorporate some of the fees into the loan amount. This written agreement regarding mortgage origination fees would have to be provided to the borrower within three days of application and be signed before the borrower is obligated to pay any of these fees. Not only should this provide greater transparency regarding what fees are going to be charged by the mortgage originator, consumers also can decide not to sign on the dotted line if they do not like the costs associated with the loan. Finally, the bill subjects mortgage originators to statutory damages for violations of these disclosure provisions equal to the sum of the borrower's actual damages plus $5,000 for each instance such instance of noncompliance. Congress needs to take many steps to address the subprime mortgage crisis and to reinstate confidence among our nation's homeowners and those we hope will become homeowners. I believe that giving consumers the information they need regarding their loan costs is a vital part of improving this complicated and often overwhelming process. Borrowers need to better understand the financial ramifications of choosing a certain loan product from a certain mortgage originator early in this process, and before they actually consummate the loan. I hope my colleagues will join with me in supporting this legislation that I believe will greatly improve mortgage loan disclosures. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. REED

Mr. REED. Mr. President, last week, this Senate deliberated and voted on the nomination of Judge Mukasey for the position of Attorney General of the United States. I opposed that nomination, and I believe it is appropriate to indicate formally and officially and publicly my concerns and my rationale for this vote. This was not a decision that was made lightly. The Constitution gives the President the unfettered right to submit nominees to the Senate, but the Constitution also gives the Senate not only the right but the obligation to provide advice and consent on such nominations. We do not name a President's Cabinet, but it does not mean we are merely rubberstamps for his proposals. Senatorial consent must rest on a careful review of a nominee's record and a thoughtful analysis of a nominees's ability to serve not just the President but the American people. As I have said in the past, unlike other Cabinet positions, the Attorney General has a very special role--decisively poised at the juncture between the executive branch and the judicial branch. In addition to being a member of the President's Cabinet, the Attorney General is also an officer of the Federal courts and the chief enforcer of laws enacted by Congress. He is, in effect, the people's lawyer, responsible for fully, fairly, and vigorously enforcing our Nation's laws and the Constitution for the good of all Americans. Although I believe Judge Mukasey to be an intellectually gifted and legally skilled individual, I am very concerned about his ability to not just enforce the letter of the law but also to recognize and to carry out the true spirit of the law. Frankly, I found Judge Mukasey's lawyerly responses to questions regarding the legality of various interrogation techniques, in particular waterboarding, evasive and, frankly, disturbing. Waterboarding is not a new technique, and it is clearly illegal. As four former Judge Advocates General of the military services recently wrote to Senator Leahy, in their words: In the course of the Senate Judiciary Committee's consideration of President Bush's nominee for the post of Attorney General, there has been much discussion, but little clarity, about the legality of ``waterboarding'' under United States and international law. We write because this issue above all demands clarity: Waterboarding is inhumane, it is torture, and it is illegal. These gentlemen have devoted themselves to their country, as soldiers and sailors and aviators, and also as attorneys. At the crux of their service was the realization that what we espoused, what we stood for, would also be the standard we would claim for American soldiers and aviators and sailors and marines if they were in the hands of hostile forces. It is clear in their eyes--and should be clear in our eyes-- that waterboarding is inhumane, it is torture, and it is illegal. It is illegal under the Geneva Conventions, under U.S. laws, and the Army Field Manual. The U.S. Government has repeatedly condemned the use of water torture and has severely punished those who have applied it against our forces. As Evan Wallach--a judge in the U.S. Court of International Trade and a former JAG who trained soldiers on their legal obligations--wrote in an opinion piece in the Washington Post, it was for such activities as waterboarding that members of Japan's military and Government elite were convicted of torture in the Tokyo war crimes trials. The law is clear about this horrifying interrogation technique. Waterboarding is illegal torture and, to suggest otherwise, damages the very fabric of international principle and more importantly, of what we would claim and demand for our own soldiers and sailors and marines. Now, Judge Mukasey was given several opportunities to clearly state that waterboarding is illegal. Instead, he went through a lengthy legal analysis regarding how he might determine if a certain interrogation technique was legal and then told us that if Congress actually wrote a law stating that a particular technique is illegal, he would follow the law. I found the last declaration almost nonsensical. This is the minimum requirement we would expect of any citizen of this country, that if we passed a law, they would follow the law. I think we expect much more from the Attorney General. We expect him to be a moral compass as well as a wise legal advisor. We expect he would be able to conclude, as these other experts and as our history has shown, that this technique is indeed illegal. We need an Attorney General who has the ability to both lead the Department of Justice and to tell the President when he is crossing his boundaries. We do not need a legal enabler to the President. We need an Attorney General who will stand up for his obligation to the Constitution, and make this his foremost obligation, rather than his obligation to the President. Not definitively stating that a technique such as waterboarding is illegal demonstrates to me that Judge Mukasey does not have those qualities we need in an Attorney General. As we learned from Attorney General Gonzales, we need someone who is willing to stand up to the President instead of helping the President negotiate around either the letter or the spirit of the Constitution. This is not just an academic exercise. If the question of whether waterboarding is illegal torture was asked of the parents of American soldiers, their answer would be quite clear: Of course, it is. If it was applied to the spouse or the loved one of a soldier--their answer would be: Of course, it is. I think those people are as expert as Judge Mukasey and certainly much more candid. I also think we have risked a great deal in the administration's embrace of these techniques because today, as we look around the world, there are many nations that do not even need that kind of suggestion to embark on the torture of their own citizens. The Burmas of the world and other countries, they will use what we say and do as justification for what they might want to do. I think we have lost the moral high ground during this whole exercise going back several years. Finally, I would like to mention my concerns about Judge Mukasey's responses to questions regarding executive power. His responses to these questions did nothing to reassure me. In fact, I now believe that Judge Mukasey believes that even a constitutional statute could become unconstitutional if its application constrains the so-called constitutional authority of the President. As we all know, the genius of our Founding Fathers was not to allow power to be concentrated in the hands of the few. Indeed, they were particularly concerned about a concentration of power in the hands of the President. Although they made the President the Chief Executive Officer of our Government and the Commander in Chief, the Founding Fathers constrained the President through the very structure of our Government, through both law and treaty. The Attorney General has a duty not just to serve the President but also to support, protect, and defend the Constitution. I did not vote in support of Alberto Gonzales's nomination to be Attorney General because I was concerned about his ability to serve more than the President--a concern that has been borne out by the events over the last several months. It is largely because of his actions we are in the quandary we are in today with respect to torture and so many other issues. Instead of protecting our Nation's Constitution and upholding our laws, he engaged in actions that damaged our Nation's core values and put our citizens' rights at risk both here and abroad. Given the extreme politicization of the Department of Justice, and the demoralization that has followed in his wake, I believe our Nation needs an Attorney General who can help lead us like a beacon of light and help right our country's moral compass as an example again for the rest of the world. I do not think Judge Mukasey met that standard. I yield the floor.

Mr. REED

Mr. REED. Mr. President, I also ask unanimous consent that I be given 10 minutes from the majority leader's time.

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

Mr. REED. Mr. President, we are here today at this juncture to talk about the point of order raised against combining the MILCON bill and the Health and Human Services appropriations bill. There is a large point I will try to make, which is that these bills are complementary in many real ways. Veterans, for example, do not live alone with other veterans. They have families who require education, Pell grants, Head Start funds, and all of that is within the purview of the Health and Human Services appropriations bill. Also, they are individuals, our veterans, who have earned their rights. But I don't believe they engaged in battles for this country and wore the uniform of this country to get a pension or to get a health benefit; they did it for a broader, much larger, much more noble purpose, and that was to build a decent and just America. Part of that is making sure children have immunizations, making sure children can go to good schools and disadvantaged children can enjoy health through the title I program; making sure talented young people can go to college with a Pell grant or a Stafford loan; the CDC can protect all of us from disease, and the NIH can use their resources to research breakthroughs in medicine and health care to benefit all of us. It is that vision of a decent, humane, and just America that ultimately compelled millions of Americans to wear the uniform of this country and defend it. So the notion that we can arbitrarily or not arbitrarily separate these bills, I don't think it accords with one of the major functions of all of us as citizens, as soldiers, as Senators--to serve the greater good--and we are doing that, I think, with these two appropriations bills. There is another point I think which is interesting to me. These bills have passed the Senate overwhelmingly. They would, I think, if they were separated, pass overwhelmingly. But it seems to me we are now in a situation where we can't combine them because the President has said: Don't put them together because I will sign one and veto the other, which presents my colleagues in the Senate a very interesting situation: After voting for the underlying bills overwhelmingly, do they support the President's veto? I hope we can avoid that. I think we should send these bills together to the President today. We can do that. We can expedite the funding of the VA at record levels. We can fulfill our obligations to citizens across this country in many different ways by supporting this procedural approach of combining the bills, voting for the bills, and sending them to the President. But the premise I think is we will separate them if this point of order is sustained, and then we will see the VA bill probably signed but then have to come back and negotiate a way for a bill we all support--the Health and Human Services bill. I don't think that is the right approach. The fastest way to get this legislation, with respect to veterans, to the President is to vote against this point of order, send it to the President, he can sign it, and next week we can celebrate Veterans Day with the largest veterans appropriations bill that we have ever passed. I think that is the route we should pursue. I don't think we should allow the President to dictate the terms. One of the interesting things about the President's approach-- particularly as we have talked time and time again about Iraq--is that: Well, the Congress can't tell me how to run policy; all they can do is fund or not fund the war. Well, here we are making a very bold, very assertive statement about funding the Veterans' administration, Military Construction, and Health and Human Services. But he says: Well, you can't do that. You can't tell me that either because I will veto one and I would not accept a package, even though it is a package of funding. Again, I think we have to--and we should--assert our will, particularly when it comes to the underlying legislation that passed this body with extraordinary--extraordinary margins. This would be, I think, a different debate if we had taken a bill that was popular and combined it with a bill that could not pass this body, or barely pass this body. Both of these bills have commanded I think strong support, and they should go forward and be signed by the President. But there is another issue here, too, and it goes back to the initial point I made about there is a complementarity between these two bills, and it is a very direct and, I believe, powerful one. We have, for example, within the Health and Human Services bill, $228 million for the Veterans Employment and Training Program. It is in the Department of Labor. But if you are a veteran and you are looking for the training you need and employment opportunities because you have served your country honorably and well--and if we don't pass that Health and Human Services bill, that money will not be there. We have in the Department of Labor $23.6 million for the Homeless Veterans Reintegration Program. In fact, I dare say, there is too little attention being paid to homeless veterans. There was a report today that one in four homeless individuals are veterans of the military. That is a shocking and shameful statistic for this country. We have in this bill one of several programs--very small, but they help veterans. That is in the labor portion of the bill; that is not in the veterans' portion of the bill. Funding for the Department of Education, $1.26 billion to impact aid payments. Those payments are targeted to school systems that serve military installations, large populations not only of veterans, but of Active-Duty soldiers, sailors, airmen and marines. So we are saying: Great, we are going to give the veterans what they deserve, but for those veterans and Active-Duty personnel, we can't vote in this bill for $1.26 billion in impact aid. We can't provide their children the kind of school systems in adjoining neighborhoods to military posts that we think is adequate--not only adequate but we hope excellent. So these bills are not distinguished in some respects. They serve the veteran population and the military population, and to suggest they are totally opposed and diametric is, I think, wrong. In the area of health care funding, we went a long way in the Veterans' Administration bill to put significant resources into the veterans health care program. In fact, for the first time, it exceeds the independent budget which veterans organizations present to us each year, when it comes to veterans health care, the largest increase in veterans health care, the largest appropriation we have ever given. One of the areas we asked them to look at is traumatic brain injury, post-traumatic stress. We understand now because of the nature of combat and conflict in Afghanistan and Iraq, there are thousands of young men and women coming back with traumatic brain injuries. They did surveys of returning brigades of some of our Army units and estimated that perhaps 20 percent of the troops might have some indication of traumatic brain injury--slight to moderate. Over time, this is an increasingly more difficult problem for the VA system. Of course, we have asked them to treat these individuals. But in the Health Resources and Service Administration--in the other appropriations bill, we have $9.5 million for the traumatic brain injury program. We have billions of dollars for the National Institutes of Health, for their research, which will be extremely important if we want to understand the phenomenon of traumatic brain injury. Of course, if we don't move that bill today, this bill, along with the Veterans' Administration bill, at least temporarily we lose these funds. So I think there is a synergy between the two bills. I think it goes back to not just the complementary programs; it goes back to what our veterans and our soldiers today are serving for--not self- aggrandizement, not a pension, or to get the benefits they have earned alone but for something bigger. Those men and women are not out there putting time in so when they get to be 40 or have 20-plus years of military service they get the pension. They are risking their lives so this country lives up to its highest ideals. If we cannot provide and pass a robust appropriations bill and get it signed by the President on Health and Human Services, we are not living up to our obligations and our ideals. Mr. President, I yield the floor.

Mr. REED. Mr. President, I am pleased this afternoon to recommend the Military Construction, Veterans Affairs, and related agencies division of this conference report to the Senate. This is an extremely important and time-sensitive funding measure, and I urge my colleagues to adopt it without delay as part of the Labor and Health and Human Services conference report and send it to the President to be signed into law. I am particularly honored to be presenting this measure to the Senate on behalf of the chairman of the subcommittee, Senator Tim Johnson. We have worked closely throughout the entire appropriations process, and the Military Construction and Veterans Affairs provisions before the Senate today are the product of a thoroughly collaborative and a cooperative effort, but the leadership was provided by Senator Johnson. I appreciate Senator Johnson's graciousness in allowing me to offer this conference report on his behalf. I would also like to thank the ranking member of our subcommittee, Senator Hutchison, for her excellent work and cooperation in developing this conference report and the chairman and ranking member of the full committee, Chairman Byrd and Senator Cochran, for their strong support and guidance in shepherding this legislation to the floor. The Military Construction and Veterans Affairs conference report before the Senate today is fair, balanced, and a bipartisan piece of legislation that deserves the full support of the Senate. The Military Construction and Veterans Affairs portion of this conference report is critically important to our Nation's military forces and to our veterans. It includes $64.7 billion in total discretionary funding--$3.7 billion over the President's budget request for the Department of Veterans Affairs. This level of funding includes $37.2 billion for veterans health care, a high-water mark in the history of the Department--the largest sum of money ever appropriated for veterans health care. Indeed, it is consistent with the independent budget the veterans organizations have proposed year after year. This is the first time we could match their goal with our appropriation. We have provided $2.6 billion more than the President requested for veterans health care and $373 million more than the veterans service organizations sought in the independent budget. We have, in fact, gone beyond what the independent veterans organizations have suggested in their budget. This level of funding is a clear demonstration of the importance this Congress places on the health and welfare of our Nation's veterans. The funding included in this conference report supports a myriad of programs crucial to America's veterans, including funding the veterans hospitals, clinics, and veterans centers, as well as cutting-edge research into critical areas of health care such as traumatic brain injury and post-traumatic stress disorder. As a result of the asymmetric combat we are witnessing in Iraq and Afghanistan, this Nation is producing a new generation of veterans, and they have markedly different service-related injuries than were experienced in previous wars. Thankfully, more service men and women are surviving their war wounds, but many are surviving with catastrophic physical and mental injuries. The nature of veterans health care for new veterans is changing dramatically, while the demand for short-term and long-term health care for veterans of previous wars is rapidly increasing as the veteran population ages. We have two currents rushing together: veterans of World War II and Korea who are now in their seventies and eighties requiring more care simply because of their age, and a new generation of veterans coming out of Afghanistan and Iraq, many of whom are sustaining neurological injuries such as traumatic brain injury or post-traumatic stress disorder. This other stream of veterans is flooding into our system, and we have to care for all of these veterans. That is why this legislation is particularly timely and particularly important. All of the challenges to the Department of Veterans Affairs are enormous. The conference report before the Senate today addresses those challenges. With this funding, we are providing the resources for the Department to meet the needs of both aging veterans from yesterday's wars and emerging veterans from today's conflict. The conference report also includes critically needed funding for military construction. It provides a total of $21.5 billion for military construction and an $8.4 billion increase over last year's funding level, with most of the increase directed toward implementing the 2005 Base Realignment and Closure Program. I am particularly pleased that the conference report includes $1.1 billion for the Nation's Guard and Reserve forces--a 34.5-percent increase over the President's budget request. The wars in Iraq and Afghanistan have placed an unprecedented demand on the Nation's Guard and Reserve Forces. Yet the President's budget slashed construction funding for several of the Guard and Reserve components. This conference report corrects that inequity. For example, it increases funding for the Army National Guard 25 percent over the President's budget request, and for the Air Guard, the conference report more than triples the President's budget request. Military construction may not have the glamour of the Defense Department's sophisticated weapons and other programs, but it is, nevertheless, the bedrock of the Nation's military. Our troops must have sufficient funding to provide barracks, facilities for training and maintaining their equipment, and adequate housing for their families. Without the resources provided in this legislation, these crucial facilities could not be constructed. This legislation provides funding for an impressive array of military construction projects, the vast majority of which were requested by the President. All of the major construction projects added to the President's budget by the Senate have been fully vetted, are included in the authorization bill, and are encompassed within the service's Future Years Defense Plan. Some have complained that the Military Construction and Veterans Affairs conference report should not be coupled with the Labor and Health and Human Services conference report. I will have more to say about that later, but I would like to make the point now that these two bills complement each other in many respects, and it makes perfectly good sense to link them together. There are more than a few crossover items between the Military Construction and Veterans Affairs appropriations bill and the Labor and Health and Human Services appropriations bill. These include, to name a few, the Labor Department's Veterans Employment and Training Program, which includes the Homeless Veterans Reintegration Program; the Department of Education's Impact Aid Program, which assists school districts whose student population is swelled by military dependents; and the Traumatic Brain Injury Program directed by the Department of Health and Human Services and the Centers for Disease Control. There are numerous programs that provide benefits to veterans and their families that are included in the Health and Human Services program. Veterans are not simply veterans. They are members of communities. They have children. They have spouses. They require the services that are included not only in the Veterans' Administration bill but particularly their families in other legislation and other appropriations included in the Health and Human Services bill. Something else, too, I think is important to stress, and I will do that in greater detail, these veterans as young men and women committed themselves to this country, not because they anticipated collecting veterans' benefits but because they wanted to make a difference. They wanted to ensure that--mercifully and hopefully--the next generation of Americans wouldn't have to go into combat, but beyond that, that all Americans would have a chance. It was not about ensuring elaborate tax loopholes or sophisticated financial transactions; they were fighting-- and, sadly, being injured and too many dying--to give people a chance in this country, an opportunity to go to school, for children to get immunizations, and for bright, talented young people to go to college. That is why I think it is also essential that these two bills are being considered together, because if we provide for our veterans, they have earned it--and we should and we must and we will--but if we neglect the rest of the country, have we truly fulfilled and measured up to what they served and sacrificed for? I don't think so. The Senate has before it a comprehensive and vitally important conference report for funding both Departments, both areas--the Department of Labor and Health and Human Services, the Education Department, and Military Construction and Veterans Affairs. We have the opportunity--I would argue, the obligation--to send a signal to the President of this country and to the Nation that we are not willing to play favorites among appropriations bills. Funding for health care for our veterans is clearly a priority, but it does not trump our commitment to fund health care services for all Americans or education programs or job training for those who need it, including veterans who participate in many of the Department of Labor programs. I urge my colleagues to support this conference report in its entirety and send it to the President today. Mr. President, I yield the floor and reserve the remainder of whatever time I may have.

Mr. REED

Mr. REED. Mr. President, yesterday I voted with great enthusiasm for the SCHIP reauthorization bill. I think the present version is commendable and a version we should support. I particularly thank Leader Reid, Chairman Baucus, and Senator Rockefeller for their efforts, and I commend them. The bill provides an additional $35 billion to preserve coverage for all 6.6 million children currently enrolled, and it expands coverage to an additional 4 million children. The President and House Republicans have already denied these children access to health care once, by first vetoing the legislation and then sustaining the veto in the House of Representatives. I hope this version can pass without a veto. If it is vetoed, I hope the veto can be overridden. The President's proposal, rather than expanding coverage, would in fact dramatically restrict coverage, dropping 1.4 million children and pregnant women. That is according to the Congressional Budget Office. So there is a very stark choice between an administration that wants to restrict coverage for children and this legislation, which would maintain, and indeed expand, that coverage to cover 10 million children in the United States. With respect to Rhode Island, this bill adds an additional $75 million in Federal funds on the table. It has to be matched, but this would allow the State of Rhode Island to maintain its program of health care for children. The bill would prevent shortfalls that have periodically cropped up, where the State found itself expending all of its funds and hoping there would be a redistribution of funds from other States that have not used their funds. Last year, and again early this year, I fought for $56 million in Federal funds to cover Rhode Island's shortfall. But these 11th-hour stopgap measures are not sustainable. The legislation we passed yesterday would prevent my State from being in a constant situation of shortfalls, hoping that other States have excess funds, and depending upon individuals in our delegation to get those funds for Rhode Island. If President Bush and the House Republicans fail to enact this bill-- if he vetoes it, and they sustain that veto--21 States will be at risk of shortfalls, totaling $1.6 billion. Rhode Island will have a shortfall of $44.1 million, beginning next March. We can predict that today. I don't know where my State would get that $44 million. It is in a severe budget crisis. State leaders are talking about trying to find $100 million to $200 million in cuts, which in our budget is a significant amount of money. So the idea that they would have to come up with $44 million on top of that is something that would be a very difficult challenge for Rhode Island. If Republicans do not enact this bill, we must fully fund an extension that covers these shortfalls. We will be back next spring scrambling to find money to keep these programs functioning. I hope we can prevail at this juncture to create a program and funding that will be sustainable, predictable, and supportive of efforts in my State, and many States across the country, to reach out and insure children for their health care needs. The President's opposition is not based on fact or common sense or, indeed, even common decency; it seems to be based on ideology. He says families would switch from private insurance to government-run health care. But the number of uninsured is rising because private insurance is too expensive. In Rhode Island, the average family premium for a year is $11,924. If you look at a typical working family in Rhode Island, it is struggling now to pay its mortgage. We have seen what is happening in the mortgage market, where many of these families, in order to get into a home, signed up for what are termed an ``exotic'' mortgage. In my State, foreclosures are at record-high levels. People cannot keep up with their mortgage payments. Then, added to that dilemma, wages have essentially been flat over the last 5 to 6 years, mortgage payments are going up, the price of gasoline is now reaching significant heights, and it is estimated that this winter heating oil in New England will be 20 percent more expensive than last winter. Are you then going to tell them: Oh, just go out and buy private health insurance for $11,000 a year? That makes no sense for working families in Rhode Island. They are struggling to keep their homes and, literally, to keep the lights on and keep it a little warm during the wintertime. For many of these people, private health insurance, at $11,000 a year, is way beyond their reach. So to sit there and seriously insist that this is a real choice for these families--a choice of getting into a public program or buying private insurance--verges on the ridiculous. Without the SCHIP program, thousands of families in my State--and millions of children across the country--will not have health care. There is no choice. There is also the President's argument that this is socialized medicine. I believe that is a gross misrepresentation. In Rhode Island, children are enrolled in private plans, and enrollees can choose their doctor. In fact, there is another program like this, called Medicare. I don't see the President rallying against Medicare, saying how it is socialized medicine. In fact, I can recall he proposed--and this Congress supported--one of the largest expansions of Medicare by adopting a drug benefit. That costs the Federal Government billions of dollars, and there is no discussion about that. These arguments are baseless. The President says this bill costs too much. In fact, this bill is fully paid for; it is one of the few things in the last 6 to 7 years that has been fully paid for. It is paid for by a cigarette tax, and it is in sharp contrast to the President's repeated request for money for Iraq and Afghanistan, which is not paid for. He is spending about $12 billion a month. Of that money, over the last several years in Iraq, we have invested in items such as building Iraqi health care clinics and providing health care for Iraqis. In trying to reestablish stability in that country, the President recognizes that to have a decent, well-ordered society, you have to have access to health care for citizens. The problem is, he doesn't seem to recognize it here as much. So I believe we have to support this legislation. The President also says the bill doesn't target low-income children. In fact, 80 percent of newly insured children would be from families below 200 percent of poverty. That is a pretty good target. He talks about the bill expanding coverage to families making $80,000 a year. That was always a misrepresentation. But we make it clear in this bill that eligibility is capped at 300 percent of poverty; that is, families making $60,000 a year. That sounds like a lot, but if you are in a major urban area, with rents costing $1,000 to $1,500 to $1,800 a month for just a fairly--and I emphasize ``fairly''--decent two-bedroom apartment for your family, when you do the math, these people are not in a situation of excess wealth by any means. In Rhode Island, 10,000 children remain uninsured. We can do much better. The Rhode Island program provides family-based health insurance. Rhode Island does enroll parents in this health care program. They found that it helps when the whole family is part of the delivery system. It has enhanced their ability to recruit children into the system. It has enhanced, in their view, health outcomes because now we have a family engaged rather than an individual child. I think it is appropriate in Rhode Island that we have such a forward-thinking and progressive approach because the basic SCHIP program was, in many respects, the work of Senator John H. Chafee, my colleague, a former Republican Senator who was succeeded by his son Lincoln Chafee in this Chamber. Senator Chafee, who was a pragmatic, hardnosed Republican whose values were to provide opportunity to all citizens in the nation, understood that if we could deliver effective health care to children in this country, we would go a long way to give them the physical tools to be successful in school, to succeed in the workplace, and ultimately to be citizens of this great country. He fought hard for this program. He didn't do it on an ideological basis; he did it on a very pragmatic, practical basis. His success has been demonstrated over the last 10 years because we have given more children access to health care. There are countless stories that will be forever unknown to us, but they will be decisive in the lives of children because this program has made a difference in their lives. Where they would have suffered with an undiagnosed disease that would have impaired their ability to thrive in school and work, because they had simple, preventive health care early on, they have been successful in school, and they will be successful in life. Families have been relieved of one of the most grievous fears they carry, and that is: Oh, my gosh, what happens if my child gets sick; I have no health care coverage--the gnawing fear at night that something could happen the next day and you have no way to protect your child because you cannot afford to get them health care. That fear has been relieved. There is a very popular commercial from one of the credit card companies: Such and such an item, $10; such and such an item, $9; having the ability to do this, priceless. For families, having the confidence that they have health care is priceless, and this bill has helped them. I hope the President will sign this bill, and if he doesn't--if he continues to roam through his ideological warehouse and pick out different odds and ends to justify this veto--then I hope the House Republicans have the courage to stand up and say: No, we are going to do what is right for the children of America, not just what is politically convenient for the President. Mr. President, I yield the floor and suggest the absence of a quorum.

Mr. REED

Mr. REED. Mr. President, 5 years ago today, Senator Paul Wellstone, his wife Sheila, his daughter Marcia, and three of his staff perished in a plane crash. This was a tragic loss to the Wellstone family, including his two surviving sons, David and Mark, his State, our Nation, and this body. His passion, energy, and commitment on behalf of the ``little guys''--all those without a voice, including children, the poor, the homeless, victims of domestic violence, the mentally ill--serves as an example to us all. He was a champion for all those who needed one, and for doing what is right. This was well-illustrated in his unwavering devotion to the fight for mental health parity, robust education funding, and affordable housing. Senator Wellstone worked tirelessly to achieve fairness in the treatment of mental illness. On September 18, the Senate unanimously passed mental health parity. In the other body, the Paul Wellstone Mental Health and Addiction Equity Act recently moved through committee. We must continue the fight toward final passage of mental health parity. I look forward to that day, which will be a historic achievement, and an enduring memorial to the life of this great man. I was honored to serve with Senator Wellstone for over 4 years on the Health, Education, Labor, and Pensions Committee. He was a consistent and powerful advocate for increased education funding and ensuring our children possess the necessary skills and tools to compete in an ever- expanding global economy. During the debates on the No Child Left Behind Act in 2001, he would say, ``We cannot realize the goal of leaving no child behind on a tin cup budget.'' Unfortunately, today we are still struggling to provide more than that ``tin cup'' budget as the President has cumulatively underfunded title I of the No Child Left Behind Act, the Federal Government's most significant commitment to K-12 education, by over $43 billion since its enactment. As such, his words seem more appropriate than ever. Senator Wellstone worked on a multitude of issues, but I want to touch on just one other today, and that is affordable housing. At Senator Wellstone's suggestion, on April 15, 2002, I flew out to Minnesota to hold a Banking Committee Subcommittee on Housing and Transportation field hearing on ``Affordable Housing and Working Families.'' At the time, Minnesota had one of the Nation's highest rates of homeownership, yet one of the worst affordable rental housing shortages in the country. It was our hope that we could learn more about the affordable housing crisis impacting working families, and how government could best work with the private sector to address the problem. Paul's passion for this issue and his special connection to his constituents was apparent throughout this hearing. He was intent on figuring out what obstacles stood in the way of creating more affordable housing, and what the Federal Government could do to help. Paul believed in democracy with a small ``d,'' and he allowed anyone in the audience who had something to say to come up to the microphone and tell the U.S. Senate what it might do to help. Paul's untimely death was a huge blow to many of us. He inspired us every day to focus on those who were less fortunate, and that legacy must continue to live on. (At the request of Mr. Reid, the following statement was ordered to be printed in the Record.)

Mr. REED

Mr. REED. Mr. President, I would like to engage my colleagues, Senator Harkin and Senator Specter, in a colloquy on the Fiscal Year 2008 Labor, Health and Human Services, Education, and Related Agencies Appropriations bill. I want to thank Senator Harkin and Senator Specter for their work on this bill. The bill restores cuts proposed in the President's budget while balancing many important national priorities. The President's proposed budget request of $141 billion for the programs funded by this bill is clearly inadequate and I am glad the Committee on Appropriations allocated additional funding to this bill. However, even with this additional funding, I recognize the difficult budget constraints facing the subcommittee as it tries to reverse previous funding cuts to important education, labor, and health and human service programs. One program particularly important to working Americans families and seniors is the Low-Income Home Energy Assistance Program, or LIHEAP. I know the chairman and ranking member are strong supporters of this program. Studies have shown that energy insecurity affects the health, nutrition, and learning of children. LIHEAP provides vital assistance to families, disabled individuals, and seniors so they don't have to choose between eating and paying an energy bill. With utility shutoffs and arrears on the rise, we cannot afford to support the President's cut of $379 million to the program. In my home State, utility shutoffs for nonpayment are at their highest level in 10 years. The State's data shows that through August, there were 20,326 shutoffs for the year. If this is not bad enough, the Energy Information Administration's Winter Outlooks estimates that the average household will spend $891 to heat with natural gas this winter and a family heating with oil can expect to spend $1,785 this winter. We need to increase LIHEAP funding, not cut it as proposed in the President's budget. I want to thank the chairman and ranking member for restoring funding to the Fiscal Year 2007 level, but it is my hope that in conference we will be able to raise LIHEAP funding to $2.662 billion, the level provided in the House. I would also like to bring another issue to your attention. The House bill contains report language that would direct the national center for public health informatics to continue to fund the establishment of a nationwide database of contact information for practicing physicians. In the event of a terrorist attack, natural disaster, or a pandemic, Federal agencies and State and local health departments could use this database to contact physicians to request their help. In my State of Rhode Island, the Rhode Island Medical Board participated in the pilot project of this program. Based on the success of that pilot project, I support its expansion nationwide. I hope that in conference, we can keep this House report language.

Mr. REED

Mr. REED. Mr. President, parliamentary inquiry: Is there a pending amendment?

Mr. REED. This amendment would provide $6 million for the program. It is fully offset. It is a small amount of funding to improve and expand the availability of trauma care across the country, particularly in rural areas, to ensure all areas are equipped with appropriate emergency and medical services, thus improving the survival rate and recovery rate for injured patients. Trauma care is not only critical to providing timely access to lifesaving interventions, it is central to our national security and disaster preparedness. It is an essential component of our overall health care system and something I believe we have to do. I hope that at the appropriate time my colleagues will be able to support this very worthy measure. Let me thank Senator Harkin and Senator Specter and particularly their staffs for a bill that I think does speak to the best of America, and does, in fact, define, in a very positive way, our most important priorities. I yield the floor.