Jay Rockefeller

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, this is not one of the most broadly understood issues. But it is a very important one, Medicare Select. There are, I guess, two issues that concern me. One--and this is less important, but nevertheless important to me--is the area of process. I had written Senator Dole, the majority leader, a number of months ago asking for a hearing on the subject of Medicare Select. I was told in a letter back from the majority leader that we would have hearings on Medicare, obviously, and that Medicare Select would be a part of those hearings. The Finance Committee has not had any hearings on Medicare Select and, therefore, that constitutes a problem. Second, there is a study on Medicare Select which is going to be completed by the end of the summer, and it is not a frivolous study or a frivolous problem. It is a serious problem involving seniors and Medicare supplementary insurance. Currently, 15 States are participating in the 3\1/2\-year experimental Medicare Select Program. This bill would expand Medicare Select to all 50 States for 5 years. One of the States that has Medicare Select is, in fact, the State of Florida. I cosponsored legislation sponsored by Senator Graham that would temporarily expand Medicare Select for another year. So this is not just a question of those States that have Medicare Select wanting to continue to expand it, or to make it permanent, or whatever. We have genuine concerns. There are other issues involved. One of the conclusions of the preliminary evaluation of this study which I have been referring to, which will be completed at the end of the summer--and that is why I hoped we could wait until that time, this being the first year of a 2- year session--was that about half of the savings in the form of cheaper MediGap premiums for beneficiaries came about as a result of discounting payments to hospitals. Now, theoretically, if seniors are having their care actually managed, the Medicare Program would realize savings from the lower use of health care services. [[Page S6785]] If, in fact, the savings are merely the result of hospital discounting arrangements, the Medicare Program is not going to benefit at all financially. Again, that is not an overwhelming factor, but a very important factor in view of the overall Medicare cuts we are looking at this year. CBO, in fact, scored the expansion of the Medicare Select Program as budget neutral, not as saving or costing Medicare, but budget neutral. They said it does not cost and it does not save the Medicare Program any dollars at all. Now, my colleagues and friends on the other side talk about expanding choice and restructuring Medicare by getting more seniors into managed care in general. Yet Medicare Select, one of the managed care options already available under the Medicare Program in at least 15 States, does not save the Medicare Program money. So far, therefore, claims from the other side on the so-called magic of the marketplace does not seem to be doing anything to save costs for Medicare. That is the point I am trying to make. Many people believe that managed care is not going to save the amount of money that some people think it is because the elements of managed care are not enough. There is the cost of technology and more people getting older faster-- that number is increasing very fast. The Consumers Union testified before the House Commerce Health Subcommittee that: Lawmakers should not make permanent a managed care form of insurance to plug gaps in Medicare coverage because of very serious questions about the supplemental's plan deceptive pricing practices and its effectiveness at holding down health care costs. We should not make this program permanent and expand it to other States until we know that it is really a good deal for the customers. That is all I am saying. I am simply requesting that the study which will be ready by the end of the summer, which is already in progress, which has already issued a beginning report, be allowed to be completed, that we see if, in fact, it is good for consumers, before we take any further steps. Consumers Union has raised concerns that because of insurance underwriting practices, seniors may be locked into Medicare Select managed care policies and be unable to purchase another MediGap policy. We looked at MediGap 5 years ago, in 1990. We passed legislation on MediGap. It was very good legislation and it cut down on abuses and consumer confusion. Seniors, for the most part, do have Medicare supplemental policies. Sometimes they use it to help pay part of their premiums. Sometimes they use it to get more services that Medicare does not offer. But it is very, very important. HCFA, the Health Care Financing Administration, has voiced a concern about a lack of quality assurance requirements for Medicare Select managed products. Medicare HMO's are required to have an active quality assurance committee headed by a physician that gathers and analyzes data and works for continuous quality improvement. That is important. There is no comparable requirement for Medicare Select managed care products. Medicare HMO's are required to provide data on such indicators as waiting times for appointments in urgent care, telephone access to HMO, both during and after hours. There is no comparable requirement for Medicare Select managed care products. Understand, I am not condemning Medicare Select. Fifteen States are using it. Some of those States want it to be made permanent. Some are less happy about it, but this bill is a major expansion. Therefore, it is something that we need to look at closely. To go from 15 to 50 without the benefit of at least the study Congress ordered so that we could make an orderly decision about this, just does not seem to me to make sense. It is for that reason that I am here talking, hoping that we can do something about it. If Medicare Select managed care is to be made permanent as a Medicare option, beneficiaries should be guaranteed the same level of assurance on issues of quality, issues of access, and, for example, grievance rights, as they have already in other Medicare managed care options. That seems sensible. Do the 15 have it? Do all of them have it? Do none of them have it? We need to know. A preliminary analysis of the Medicare Select experiment that was completed last year by the Research Triangle Institute concluded that from Medicare's perspective, unless Medicare Select reduces use or directs use to providers that cost Medicare less money, it offers little benefit to Medicare. The preliminary case study also indicates: Aggressive case management and restriction of networks to the more efficient providers in the communities are rare. Thus, it appears unlikely that Medicare Select will result in claims cost savings for HCFA. Now, Mr. President, I do not think that these concerns mean that we should end the Medicare Select Program. I want to be very certain on that. I think that experimentation--State experimentation--is tremendously important. I believe in it. However, I do think that several serious issues have been raised about the Medicare Select Program, and as a result I have grave reservations about extending this program to all 50 States--that would be 35 more States--in 5 years. Instead, to avoid any potential disruption in those States that currently are participating in the Medicare Select experiment, we ought to extend their programs so that they do not have to stop enrolling new people on June 30, 1995. Now, that is an important point to make. We have a drop dead date we are facing rather quickly. They cannot take new enrollees unless we extend the current States that have the programs, which I am very much for doing, so that we can learn more from those programs. I would sincerely hope that before expanding it beyond those States that now have it, we take a much closer look at the Medicare Select Program in the committee of jurisdiction, which is the Finance Committee. Then I go back again to the process question. I asked the majority leader by letter if he would hold hearings on this subject. He answered me earlier, some months ago, that we would hold general Medicare hearings in the Finance Committee, and Medicare Select would be part of those hearings. They have not been part of those hearings. They have not been even mentioned in these hearings. That is important to me because I think that process and the knowledge that one gains from that is tremendously important. I find it somewhat disturbing that my friends on the other side of the aisle who want to cut Medicare by $256 billion to balance the budget and pay for tax cuts, and who talk on a daily basis about restructuring Medicare, will not even take the time to consider a final evaluation of the Medicare Select Program. Congress mandated that this study be done. This was not somebody's whim. It was a congressionally mandated study. The Federal Government has already paid for this study to be done. But my colleagues are apparently not willing to wait a couple of months to consider the results of that congressionally mandated study. In some ways it seems to me that we are here more because the Senate is looking for something to do. I do not think this is the right way to handle the problem of the Medicare Select Program. This came up suddenly and here we are with it. I want to make it very clear why I have objected to the idea of the Senate simply rubberstamping a bill passed by the other body. There is absolutely no reason for us to be using up the time of the Senate on this at this time. If the majority leader would simply give the committee of jurisdiction the chance to review the legislation and the study through something as basic as a hearing or a partial hearing or a subcommittee hearing, then we could work out a course of action based on a responsible process and careful thought about the substance which I have raised, which is very much in question. The Senate should, I think, not acquiesce to a cavalier way of doing business, and that is what concerns me. The majority leader wants the Senate to rubberstamp a bill that would turn a limited demonstration program, called Medicare Select, into an open-ended national program. I am very concerned about an attempt to pass legislation affecting the Medicare Program [[Page S6786]] without having it carefully considered by anyone in the Senate. I ask my colleagues, who are not present on the floor with the exception of the distinguished Presiding Officer, how many of them can really tell me much about the Medicare Select Program? How many could give me one short paragraph on what the Medicare Select Program is? I would daresay it is probably six people; probably six people. And here we are at a moment when there is not much else to do, awaiting the budget resolution, but with some time to kill, and we are about to expand into a national program something which is being experimented with locally, by the States. If anything is clear these days, the Senate should know what it is doing when it changes Medicare. We are about to enter into a major debate on Medicare as it concerns the budget resolution. So anything that has the word Medicare in it, we ought to be precise, knowledgeable, and informed rather than having an hour's discussion and then a vote of some sort, affecting profoundly what happens in this country. Medicare affects 33 million people--36 million to 37 million people when you add on end-stage renal disease and the disabled, as well as those over 65. It has enormous consequences. It has enormous consequences. As we learned during the MediGap debates, it is very hard, often, for seniors to resist buying policies which are constantly offered to them. That was what the MediGap legislation was about. It was to discipline this proliferation of policies to ensure folks could not prey on seniors who could not necessarily understand all the small print, or even read the small print in the policy. So this is about protecting seniors; about not misleading seniors; about making sure that seniors get the quality assurances that are verbally offered to them by those who would sell Medicare Select. It just seems to me that if we are about to talk about a $256 billion cut in Medicare, we really ought to know what we are talking about when we do anything about Medicare, much less add on a new program, whether it costs or not. Just yesterday Dr. June O'Neal, who is the new head of CBO, the Congression Budget Office, and whom I had not seen before, testified before the Finance Committee that quality--hear this, ``The quality will suffer under the Medicare Program if we enact Medicare cuts of $256 billion.'' She said that seniors will have to pay more to get the same level of quality that they are currently receiving under Medicare. And I think this is a very serious consequence. In fact, by the year 2002, I think they will be paying $900 more per year and I think on an aggregate basis they will be paying close to $3,500 more between now and the year 2002. When you consider the fact that only a very tiny proportion of Medicare recipients have incomes of higher than $50,000 a year and that the enormous majority of them are way down at $15,000 or $10,000 or below, in that area, something like that becomes an enormous consideration. An additional $3,500? They already spend over 20 percent of their income on health care. In fact, we had an interesting minidebate yesterday on whether or not the cuts in Medicare will in fact cut Social Security for seniors. Of course, if that were to be the case, that would be a kind of third-rail item on the American scene because cutting into Social Security is something we have all decided not to do. We came up with the judgment, not so much during the hearing but after the hearing, that because of the increases in premiums, et cetera, in copayments, seniors will have to pay for more costs for Medicare, that in effect their COLA increases under Social Security in many cases will be wiped out entirely. Will seniors see that as a cut in Social Security? I think it is quite possible they will. Because it is interesting--I would not have guessed this, I say to the Presiding Officer--that Social Security and Medicare are looked upon, in many ways, as the same by the people of this country and by the seniors of this country. That whereas we said before ``Do not cut Social Security,'' people look upon Medicare as the same sort of a sacred contract, so to speak, that the American Government and the American people have with each other, and not another incidental program. So I think this is a very serious problem. The Health Care Finance Administration, HCFA, has voiced a concern about lack of Medicare Select quality assurance requirements. HCFA is not a radical organization. It is a big organization, 4,000 people, who in fact are very expert. Nobody knows they exist but they do, and they do all kinds of complicated work. They are expressing concern about Medicare Select quality assurance requirements, that they do not exist in this legislation and they do exist for other managed care options. As I said, Medicare HMO's are required by law to have active quality assurance committees. So I think there is lot at question here, and I just hope we could work this out. I had suggested a variety of alternatives, options; that we could take the States that now have Medicare and extend those for a year and a half or 2 years. Some people say if you extend it for a year, that does not really give the managed care company that is interested in looking at Medicare much incentive to move ahead. It sounds like a year-by-year basis. Maybe we could do it for longer than that. Maybe we could add on some more States, add on four or five more States and allow that to happen. But to take the entire country and open it up to Medicare Select when a study which has already raised questions is still out there and questions have been raised by health care experts in HCFA about insurance problems, plus the fact that it is Medicare, which is probably the most sensitive subject that could be discussed on the floor of this Chamber, we ought to be careful. That is why I am not for going ahead at the present time with expanding this the way the majority leader seems to want to do. I will have more comments. But I do not see anybody at this point who wishes to say anything. So I yield the floor and note the absence of a quorum.

Mr. ROCKEFELLER. Will the Senator yield?

Mr. ROCKEFELLER. Mr. President, I note the presence of the distinguished Senator from Rhode Island on the floor. I know he wants to speak. I will not take long. I talked a moment ago about the concerns of the consumer groups and the Medicare Select Program. One of their concerns is called attained age rating. Just as insurance companies charge older people more for insurance in the under 65 market, MediGap insurers charge older seniors more for their MediGap policies as they grow older. In the under 65 market, insurers claim that age rating is a sound business practice because older people use more health care services and because older people are better off financially than those who are 20 years old or younger. This argument does not work at all for those who are over 65 years old. In that important market, 85-year-olds are generally, as I hope we all know, a lot poorer than 65-year-olds. Another question that has been raised is the so-called one time open enrollment period. When we worked in the Finance Committee--I know the Senator from Rhode Island worked very hard on that also--on the MediGap legislation in 1990, we required insurers to have a one-time, 6-month open enrollment period when seniors first turned 65 so that they would have 6 months to simply enroll. During this 6-month period, an insurer under the MediGap Program is not allowed to deny insurance to any senior based upon their health status. That is an enormous statement in the health insurance industry. It is an enormous statement. They are not allowed during those first 6 months to make any health status judgments and thus say no to people. Consumer groups have raised a concern that if seniors sign up with a Medicare Select managed care product and decide that they do not like that product, they may be unable to buy a MediGap policy later because the open enrollment period would have gone by, especially, of course, if their health status is poor. I want to just add those things. I yield the floor. Mr. CHAFEE addressed the Chair.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Will the Senator yield?

Mr. ROCKEFELLER. Just as a point of clarification, the reason that the $250,000 was put in there in its new configuration was not in terms of the caps. We made certain that there was an alternate ceiling. So that if the economic damages and the noneconomic damages did not appear to arrive at $250,000 multiplied by two, that the claimant would be guaranteed the $250,000. It is an alternate ceiling.

Mr. ROCKEFELLER. I am proud to give the Senate a chance, finally, to cast its vote on a balanced legislative remedy. I am relieved we restored a bill simply dealing with product liability and with the important changes worked out in the final hours that represent the bipartisanship and the balance that we sought from the beginning of this effort. I am confident that President Clinton will sign this bill with whatever perfections we can make. I hope we will soon see the benefits of reform and demonstrate to the skeptics that the changes are in the entire Nation's interests. I yield the floor.

Mr. ROCKEFELLER. Mr. President, I ask for an additional 60 seconds.

Mr. ROCKEFELLER. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. ROCKEFELLER. Mr. President, a couple of points. I agree with what the Senator from the State of Washington said in argument to this amendment. Just for the edification of my colleagues--this fact has not been brought out, I do not believe, in the debate--we have removed caps, but people do not realize, I think, often that there are caps on some rather extraordinary crimes in the Federal statutes. I will give some examples. Many Federal criminal fines, even for particularly egregious crimes, do not exceed $250,000. And that was our original proposal, economic damages times three or $250,000, whichever is greater. Listen to this. If you tamper with consumer products and it results in death, the Federal statute limitation is $100,000 for punitive damages. If you retaliate against a witness, it is $250,000. If you assault the President, it is $10,000. If you rob a bank with the use of a deadly weapon, the punitive damage limit cap is $10,000. Sexual exploitation of children for an individual, $100,000; in terms of an organization--however that would work out--$200,000. For treason--for treason--$10,000. Now I say that in no way to defend caps, because the Senator from West Virginia has fought for the removal of caps and we have, I believe, been able to do that. I would, in closing, remind my esteemed friend and colleague from the State of North Dakota, who is as principled a person as I have ever met, that the Senator from the State of Washington and I have so bloodied ourselves in making sure we come back with effective removal of caps that we have said, and that we have been unable to obtain unanimous consent in this body to, in effect, make the cap total and complete because of a matter of 60 seconds in filing the amendment, that if we bring back the amendment with anything but the cap removed, that we will vote against the motion for cloture should there be a filibuster on the conference report. So I really do believe that we are operating not only in good faith but in good substance on removal of the cap. I hope, therefore, that what I consider a redundant amendment by the Senator from North Dakota would be defeated. I thank the Chair and yield the floor. Mr. DORGAN addressed the Chair.

Mr. ROCKEFELLER. Yes, asbestos-related injuries and deaths are covered by the toxic harm exception to the statute of repose. amendment no. 790

Mr. ROCKEFELLER

Mr. ROCKEFELLER. I move to lay that motion on the table. The motion to lay on the table was agreed to. (Later the following occurred.)

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, I strongly hope that the concurrent resolution will be agreed to. The President of Taiwan has studied and taught at Cornell, as well as Iowa State. This is a single visit. It fits within the guidelines of the policy review carried out by the White House and the National Security Council. It is a resolution which should get an ``aye'' vote.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, not only do I agree with everything that my able colleague from the State of Washington has said, the Harkin amendment adds a new section to the bill for setting punitive damages against businesses with 25 or more employees. It has to be greater than the amount recorded or using a formula laid out in the compromise bill which is twice compensatory damages or $250,000, whichever is greater, or twice the value of annual compensation of the business' chief executive officer. Well, that last one obviously is an eye-catcher, ear-catcher. It sounds innocent enough--and fun. It is kind of fun, cute. But we are on a deadly serious bill. The people who voted today to make sure that we would continue to discuss and amend product liability reform were not trying to have fun with this. We have been on this bill for several weeks now. I have been doing this for 9 years. I am sure the Senator from the State of Washington has been doing it for longer than that. There is nothing in any of my efforts to sort of do something to amuse myself, enjoy myself. I am trying to make America better. I am trying to help defendants who cannot get their claims in time. I am helping to make things more predictable for businesses so we can strike a balance between consumers and business. One thing this is not is just kind of fun. When I say it is deadly serious, I mean deadly serious because I truly believe there are products not being developed today which could save lives, and that people are dying because that is not happening. There are a couple of facts which I think are relevant. There is not a $250,000 cap in the Gorton-Rockefeller compromise on product liability reform, as suggested by the Senator from Iowa. There is not that cap. I suggest to those who do read the bill, in product liability cases, if the jury agrees that the punitive damages should be awarded, the jury can, and under the bill punitive damages will, amount of compensatory damages. And then the judge, under the additur provision, decides if that is not enough, to take it up. So there is no floor. We are not talking about treating people unfairly. In fact, I think we are trying to talk, for the first time in a long time, about treating people fairly. To highlight some more information about the suggestion of the Senator from Iowa that there is any sort of special protection for businesses which are tempted to make defective or unsafe products, everybody needs to remember that juries under our bill can award compensatory damages in amounts that span from hundreds of dollars to millions and millions of dollars. I have made this point several times, but I will make it again and I will give you a few more examples this time. I have already talked about the State of the Senator from Washington, not even considering punitive damages at all, and within the last 5 or 6 weeks there was an award of $40 million. I have no idea what the circumstances were. But that was economic plus noneconomic--compensatory damages, $40 million. You do not need punitive damages to get a big award. I am for the punitive damages, but you do not need them to get major awards. There was a $70 million compensatory award, again, not even considering punitive, to the family of a woman who died when a defective helicopter crashed--in, as it turns out, Missouri. But that did not stop the jury from awarding $70 million. So we are not kidding here. We are not doing anything fun here. There was a $15 million compensatory award--again, not even considering punitive damages; but a compensatory award--to a boy in a case involving a defective seat belt. Now, I do not know the circumstances. This was in Los Angeles County, 1993. I do not know the circumstances, but this is just compensatory award. Almost $20 million, Mr. President, in compensatory damages was awarded to a man injured in some circumstances in which a motorcycle spun around on the ground during a turn. My eloquence cannot exceed that, unfortunately, because I do not know what it was. But the man was injured by a motorcycle and got almost $20 million--I say again, in compensatory damages alone. So there is no kind of joking around here. We are trying to do the right thing. I might say, on the other side of it--and I do not want to stretch this out--that there are a lot of things that are not happening in this country because of the fact that our punitive damages situation is scaring people away from new products, new research, new improvements, or whatever. I have used this case before and I will use it again, because I think it is devastatingly powerful. I care a lot about health care and I have worked a lot on health care. I have been into kidney dialysis clinics. They are not a lot of fun to go into. The former Governor of Missouri knows what I am talking about, the Presiding Officer. It is kind of dark and people are lying back in chairs, and their blood is being completely changed. It is kind of depressing to be there. I do not think they enjoy it much. Nobody is talking to anybody else. They cannot work. They are tied into these huge machines which rise up beside them and behind them. This was carried a little step further and they developed a dialysis machine that you could take home with you so that if you worked within 2 or 3 miles, or 4 or 5 miles away, you could come home to that dialysis machine, do it yourself and then go back to work. It was a tremendous improvement, because you could go back to work, if your work was close enough so that you could come back two or three times to do that. But then Union Carbide comes along and really comes up with the answer. They put the whole thing into a suitcase-sized dialysis machine that you can take to your job with you and do the dialysis on the job. My 15-year-old son has one of his best friends who, a couple of years ago, we discovered had diabetes. That is not a lot of fun for a young kid to find something like that out. I cannot get over the way that young man, 12 years old at the time, simply adjusted to his new circumstances and was able to give himself insulin; just disappear for a few minutes and do it. His courage--he actually grew, grew in my eyes, and I think he grew in his own realization in the sense of mortality and what he could do and how precious everything was. He is a remarkable boy. In fact, I think his aunt is Madeleine Albright, our Ambassador to the United Nations--a wonderful boy. But Union Carbide, when they came up with this same kind of you-can- do-it-right-on-the-spot kidney dialysis machine, had to sell their business to a foreign company where uniform product liability laws did not give the same litigation potential because Union Carbide, an enormous company, determined that the potential liability risk made the product uneconomical. So I have to assume there are hundreds of thousands of people who need these blood changes in this country who are deprived of that now because Union Carbide could not do that. I have 20 examples. I will not give them. It is late. So I know that the amendment has sort of a nice, populist ring to it--CEO's salary. But this is dead-serious business that we are involved in. Product liability reform is something I have fought for as a nonlawyer because I want to see people's lives get better and I want to see products developed and I want to see--just on personal grounds, my mother spent years dying from Alzheimer's disease. There is a cure out there, but somebody has to put the money up to find that cure. It is probably not going to be the Federal Government, because we are cutting back. So all of this is deadly serious. This is not a bill that should be used to beat up on business. This is a bill that should be used to beat up on a legal system which is failing us and, as the Senator from Washington said, in which the lawyers get 50 to 70 percent of the money. I do not respect that. I do not like that. I want to change that. And for that, among other reasons, I oppose the amendment of the Senator from Iowa. I thank the Chair. Mr. GORTON addressed the Chair.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. This list sets the precedents and authorities supporting the constitutionality of requiring judges to determine the amount of punitive damages. And is therefore valuable information to be considered in this debate. I rely on the word and the integrity of the Associate Attorney General and his staff at the President's Justice Department. They believe, as I have indicated, that a freestanding judge additur provision as it is written in the Gorton-Rockefeller amendment, and we would like to modify it by striking section 107(b)(3)(C), passes constitutional muster. I have said that several times purposely. In my view, as an author of this legislation, that is sufficient authority to say that a severability amendment regarding additur is superfluous. To reiterate, relying on the Justice Department's determination that a judge additur provision is constitutional, I do not believe it is necessary to further amend this provision to sever the judge additur requirements of this bill in an effort to guard against a circumstance where this provision would be deemed unconstitutional. It will not be deemed unconstitutional for the reasons I have articulated. Mr. President, I just want to take this opportunity to make my colleagues aware that we have, in fact, addressed the concerns raised about constitutionality. The judge additur provision, coupled with the modification that strikes the defendant's right to a new trial, is a constitutional provision. Again, some of my colleagues on the other side of the aisle would like to add additional language which makes this particular provision severable, to make absolutely certain that the constitutionality of this bill will not be tested as a result of this provision. I have assured them, based upon my conversations with the Department of Justice and others, that their extra cautious approach is not required. In concluding, I cannot remember in the 10 years that I have been in the Senate where the two managers of different political persuasions have publicly said that they are so committed to rectifying something which is of concern to the Senator from South Carolina, to some of my colleagues, and to the White House; that the Senator from Washington has said, ``We will not come back from the conference with these provisions;'' and where the Senator from Washington this morning at a public press conference said that he would vote against the motion to invoke cloture, assuming that the conference report was filibustered. I share exactly that same view. I think that is pretty strong and dealing in good faith. We would like to hope that we can be dealt with in good faith also. Mr. President, I thank the presiding officer. I yield the floor.

Mr. ROCKEFELLER. Mr. President, my distinguished colleague from Washington just made a very, very important point, one which he and I have already made in public at a press conference which we held several hours ago, and that is that we are, in spite of the fact that the Senator from South Carolina, my esteemed, cherished ranking member of the Commerce Committee--who is a very good friend and has been, and his wife and my wife for a long, long time--does not wish to give consent for us to be able to do this--I think with the idea being that if he does not give consent, then the chances that this bill would be less attractive to the White House would increase. Senator Gorton and I are trying to make this more attractive to the Members of the Senate, Members of the House, and the White House. But I have also taken the same blood oath that the Senator from Washington has, and that is that we are so committed in terms of the additur amendment that we will not come back from conference without its being in the proper condition, and that, in fact, if it does not come back from conference in the proper condition, as we said at our press conference, we will vote against a motion for cloture. I do not know how it is possible for any two floor managers to put anything in stronger terms, or to say anything with greater faith and, therefore, it grieves me very much that we will not be granted unanimous consent to do that here when we are being so direct and honest and forthright with our colleagues. There were just timing problems in terms of submitting this, or else the amendment would have been filed and could have been brought up as a matter of the order. Nevertheless, that was not done. The Senator from South Carolina does have the power to grant us unanimous consent, but he chooses not to do so. Mr. President, I also want to simply indulge my colleagues in a couple of thoughts, to make some comments on the discussion here about the section in the compromise now pending. We are there. It deals with punitive damages. No. 1, the whole section is the result of many, many months of negotiation and discussion on, in fact, how a product liability reform bill might best deal with the costs and the problems and the erratic nature which we all recognize is at play--punitive damages. I have tried to represent the Clinton administration's discomfort-- expressed discomfort--with the idea of imposing a flat cap on punitive awards, while accommodating the strong desires of Senators on both sides of the aisle to include some reform in this bill, to pursue the idea that the punishment impleaded in punitive damages should have some sense of connection, in fact, to the crime. I also have to say that in my own personal experience, I do not like to vote for caps. I am on the Finance Committee, and when medical malpractice was before us last year and there was a vote on a cap on noneconomic damages, I voted against it. I do not like caps. It has been my own personal purpose in which I have negotiated in good faith with Members of my own party and the other party to find a way to make sure that the cap would be uncapped. I think we have done that. The Senator from South Carolina knows that. And I say this with respect because he is within his rights and he is a very skilled legislator and a very good friend. I repeat that. He understands that we are, in fact, trying to improve the bill in a way which would appeal to virtually all Members on my side of the aisle, including, in fact, in truth, I believe the Senator from South Carolina himself, because it would be a better amendment with the judge additur provision refined and nobody could dispute that. It would be better than simply two times compensatory damages with an alternate ceiling of $250,000 because one can construe that--although one can never guess what noneconomic damages will be--one can construe that, in theory, to be a cap. So I have been trying my best in negotiating with both sides to try and get that out and have succeeded. I have some sense of accomplishment in that, which is now being put aside by the Senator from South Carolina. Mr. President, I also want to make a correction for the record regarding the discussions of the constitutionality of the judge additur provision in the Gorton-Rockefeller amendment. The judge additur provision in section 107 (b) of our amendment, as it exists now, creates a right to a new trial for defendants if they do not accept the additional punitive awards set by the judge. This provision was inserted to address a perceived constitutionality concern with the judge additur provision--perceived. Senator Gorton and I are now in agreement that this right to a new trial provision is in fact unnecessary to meet any constitutionality test. The Associate Attorney General, in several conversations with my staff, has asserted that he believes the judge additur provision in Senator Gorton's and my amendment is constitutional on its own--free standing--without the provision creating a right to a new trial for the defendant should the defendant object to an award which results from the judge additur provision. Indeed, the Department of Justice prepared a list of precedents and authorities for judicial determinations of the amount of punitive damages which I ask unanimous consent to have printed in the Record.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. I thank the Chair. Mr. President, there was, to put it mildly, a certain amount of confusion as to what just happened in the last hour or so. I found myself on the telephone advising distinguished Senators with years of experience to vote for what we just voted on and then 5 minutes later to vote against it. That is not my normal custom in trying to be wise on these matters. But the fact is that, as the Senator from Washington indicated, there were procedural and technical writing problems, and the technical writing problems in the bill in fact were not addressed properly and were not done properly, and they have to be done properly. But make no mistake about it; the news of the day is not that we just had a vote on which some people thought they were going to vote no and they turned out voting yes or vice versa. The news of the day is that the Senator from Washington and the Senator from West Virginia have reached a very good agreement on a final version of the product liability reform that we think reflects the will and the objectives of Senators on both sides of the aisle. That is where the activity and the time today has, in fact, been spent. It was not spent on, unfortunately, wrapping up the last-moment details. The 4:20 cloture vote really caught me by surprise. But the time today has been spent between the Senator from Washington and the Senator from West Virginia, the Senator from West Virginia consulting with many Senators on my side of the aisle, and the staff of the Senator from Washington and the staff of the Senator from West Virginia working together. We have reached agreement. That is the news. We have a product liability reform bill which we are now convinced will pass. After 13 years of attempting to do this on the part of some, only 9 years on my part, this is remarkable, remarkable news. I believe that we are in a position now to win product liability reform. Again, I want to apologize to my colleagues on both sides of the aisle that it has taken us so long to get here, and then, when we got here, at the very last moment, we had this technical writing problem which we, in fact, had to get right and we had not gotten it right, because things were rushed. We are now in the process of doing that. It is very easy. It will be done before the end of the day and we will have the cloture motion tomorrow, which is already ordered, and on we go. Then, presumably, those who oppose the bill will try to amend it. But the Senator from Washington and the majority leader, Senator Dole, and I are convinced that we can put aside those amendments, spend the 20 hours or whatever it is that we have remaining in debate, and then go ahead and pass the bill. This is the story of the legislative process. It is not always beautiful and today was an example of it. We have on the other hand, I have to say, listened and debated and analyzed and argued every aspect of product liability and the best ways to do reform. It is very controversial. It is something that people have strong feelings on and it is hard to come to an agreement on, which makes even more formidable, it seems to me, the agreement which has been reached that affects the majority leader, the Senator from the State of Washington, the junior Senator from West Virginia, and Senators that the junior Senator from West Virginia has been working with on our side who favor product liability reform. I think the bill that has been put together, which is now agreed on, deserves support, and I think it will get support. I think, in fact, it will win rather broad support. So I want the Presiding Officer to be of good cheer and look forward to tomorrow and maybe a day or two after that. We have made real changes to the section that deals with punitive damages in a way which I think will ease concerns, particularly on my side of the aisle. We have made changes that directly address the concerns of a number of Senators. I know that this substitute remains balanced, represents real reform, and will solve some problems that have [[Page S6263]] been crying out for solution for all of these years. I hope the process will untangle itself. I am now confident it will--there was a moment there when we were not sure, but I think it will and I think it has--and we will then be able to give Senators on both sides a chance to vote for good product liability reform. This is not a product of the Contract With America. It is not a product of the Democratic Party. It is a product of people who want reform on both sides of the aisle, working within the Senate, within our ways, within our beliefs to achieve compromise. That is the way the Senate works. After all, the President of the United States will have to sign the bill and put it into law. This is what has always struck me when people say that the conference process will ruin everything. I have never felt that. I know the Senator from Washington agrees with me on that, and I suspect the majority leader does. I know I do. Because the President, if he does not want to sign the bill, if it does not meet his criteria, which he has laid out to us, will simply veto it and that will be that. So there is a discipline that works there in conference process, which is good. I remind my colleagues and the leadership in the other body of what I have just said. We have tended to push aside expansionism here and focus on product liability reform. We do that in the agreement between the Senator from Washington and the Senator from West Virginia. So, let the leadership on the other side understand that we are firm in our resolution, and that the President is, too. He will not sign anything other than what stands within his parameters of acceptability. So I conclude simply by saying that the sidebar of the day was that there was a certain amount of confusion during the process at the end. But the story is that the two sides have reached agreement--Democrats who favor reform and Republicans who favor reform. I have been through this reform with most of my colleagues on my side and have met with a very good reaction, and I assume the same is true on the Republican side. So, Mr. President, I simply wanted to say that, because there was a certain amount of confusion, but that pales in comparison to the good news of the agreement. I thank the Chair and yield the floor.

Mr. ROCKEFELLER. I ask unanimous consent to speak on the amendment.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, as one of the managers of what was once solely a bill to reform our product liability system, I wish to speak to my colleagues, those who share in a general sense the purpose of what we are trying to do here, about at least my views on the business before us. At 12:15, in 10 minutes, the Senate will vote on three pending amendments to this bill, and then vote on the first of two cloture motions. The second cloture motion vote is expected at 2 o'clock, maybe 2:15. I am not sure. I am going to make a motion to table both the Abraham amendment on joint and several liability and the Kyl amendment that tries to delete the alternative dispute resolution section of this bill, alter it in ways which I find distasteful, but the message I wish to get across most strongly is that I will vote against both cloture motions. I will vote against the one at--whenever the first one comes, and I will vote against the second one. I will not vote for one and against the other, against one and for the other. I will vote against both. I want both to fail because there are those of us who believe that this bill needs to be kept to product liability--and I think there are many of us--so that we can at least get some tort reform accomplished, which we will not in any other event. Those folks need to vote in their conscience, if that is where their conscience dictates, against both cloture motions, to vote no on both cloture motions. And I hope anybody interested in achieving actual results on product liability reform will do the same and vote no on both cloture motions today. This past week, frankly, has been rather astonishing to me, Mr. President. One would think, when a majority of Senators get the chance finally, without a filibuster on the motion to proceed, when we finally get to work on a bipartisan, balanced, focused piece of legislation to deal with this very serious problem, that is precisely how they would spend their time here. But, no, instead, we have watched Senator after Senator come eagerly to the floor to add one more ornament to the tree. As I have said before, anyone who has ever decorated a Christmas tree knows that if at some point you put too many ornaments on, too many bows on one side of the tree, that tree is going to fall over and crash down and you lose the ornaments, the tree, the Christmas spirit, and it is a terrible vacation. That is the situation I see before us right now. And the amendments from Senators Abraham and Kyl are going to assist in sending this tree to the ground. The Senate has had absolutely no opportunity that I know of to consider whether the joint and several provisions in the product liability bill make sense for the rest of civil actions. I do not know of any hearing on the topic. I do not see a bill from the Judiciary Committee on the topic, or a report laying out the arguments on an idea as significant as this one. Yes, the House of Representatives made a sudden decision to throw the idea into their stew of legislation on tort reform that passed a couple weeks ago. But this body is supposed to keep a standard of actually thinking about what it is on which we vote. We pride ourselves on that. And the idea of deleting the section in this bill that promotes alternative dispute resolution is appalling to me. Maybe I need to restate the obvious. Legislation becomes law when interests are balanced, when legislators work out difficult problems together, when problems are addressed with practical remedies. The alternative dispute resolution provision in our product liability bill is there for these reasons. Here is one of the parts of this bill designed solely and specifically to deal with one of the most maddening problems in product liability. Victims have to wait too long for compensation. The system is too slow and too inefficient. If I am a small farmer from West Virginia or some other place and I do not have any money, and I do not have any money to hire lawyers or any money to pay for time for 3 years to go by, I can avail myself of the alternative dispute resolution. We want to encourage that small farmer who does not have the resources, the small business person, the person of very modest means. And this is the way we do it, by allowing him this particular advantage. That is why we want to promote alternative dispute resolutions in a way that will speed things up so that that small farmer will, in fact, come in and probably just speak for himself and the case will be simply handled right there on the spot, no lawyer, no problem, no time, no expenditure of money. I really do not think we have to apologize for devising an approach that is slanted toward the victim when we are talking about encouraging them to resolve their cases earlier. Remember, they have wait to 3 years now. We are trying to encourage people to get that amount of time down. So in the strongest possible terms, I urge my colleagues to defeat both of these amendments. And I urge my colleagues, again, to vote against cloture, not just the first cloture vote but also the second one that will take place this afternoon at about 2 o'clock. We now have a bill that has become deformed, disfigured. A small group of Senators has refused to follow the discipline of working out with the rest of us who are interested in enacting product liability reform what we will do to accomplish that. Until they do, we should bring this bill to a halt. A majority of Senators are clearly interested in a balanced, moderate product liability reform bill--I am convinced of that; I deeply believe that--that serves consumers, victims of defective products, and business in a balanced way. We still have that opportunity. The pending cloture votes will demonstrate what it takes to succeed. Mr. President, I thank the Chair and yield the floor. Mr. HEFLIN addressed the Chair.

Mr. ROCKEFELLER. If the Senator will yield for a moment, I move to table the Abraham amendment, and I ask for the yeas and nays.

Mr. ROCKEFELLER. Mr. President, I move to reconsider the vote.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, I seek to have placed in the Congressional Record a copy of the ``Open Markets and Fair Trade Act of 1995,'' S.756, that was formally submitted for the Record yesterday, May 3, 1995, but which was not printed in full. The ``Open Markets and Fair Trade Act of 1995,'' will evaluate the current conditions of markets around the world for American products and instigate a process of negotiating access to those markets. It also gives the President and Congress a new tool to use in those negotiations--the threat of reciprocal trade action. Basically the bill tells our trading partners that if they refuse to give our products reasonable market access, we may impose the same kind of restrictions on their products. Mr. President, this bill was written in response to a problem that persists year after year. I am speaking, of course, of our trade deficit, which is out of control. Certainly, we are making progress on some micro-economic levels, and the Clinton Administration has hammered out more than 70 different trade agreements over the last two-plus years--14 with Japan alone. These are helping some industries, some workers, and some parts of our economy. But they have done nothing to shrink the trade deficit. Clearly, more must be done. Mr. President, this bill does not single out any one country. It is designed to pry open markets wherever they're closed, wherever in the world American products are denied access. This bill follows up on the Uruguay Round and looks beyond tariffs--it is designed to deal with market barriers; the internal rules in various countries that are practical impediments to American businesses. I am seeking to open more markets across the globe in order to promised. And I think it's high-time we question the wisdom that blames almost all of America's trade deficit problems solely on ourselves. For years, we've heard the same assertions: ``Americans spend too much and save too little * * * the budget deficit is too high * * * we are growing faster than other countries so we have more money to spend.'' Yes, these economic realities contribute to the problem, but under President Clinton's leadership, we have reduced the Federal fiscal deficit by over $700 billion, yet the trade deficit goes up and up. I think it's time we reverse the premise and look at how the trade deficit fuels our savings and debt problems. The inability of American companies to sell in places like Japan, China, Germany and elsewhere costs our corporations profits, our workers job opportunities, and our nation revenues--all of which weigh down our own economic growth and add to our fiscal deficit. Whether it is a requirement for American firms to hire local agents to conduct business; cumbersome inspection and customs procedures; bans on the sale of products for dubious claims of national sovereignty or some other sort of prerogative, the simple fact is that protected sanctuary markets abroad are a major contributor to America's economic problems. To explain this simply, I will use as an example the well known case of how Japanese manufacturers sell things like electronics in the United States at such cheap prices, even when the Yen is at a record height. I am citing Japan here, but it could be any other country that has a sanctuary market. It is well known that many Japanese-made products are cheaper in the United States than in Japan. That is because Japan's closed market is a sanctuary that effectively insulates producers from competition, and allows them to overcharge Japanese consumers, giving them enough of a profit margin at home to sell below cost here. That means American companies lose on both ends. We can't export into these markets, and their subsidized exports harm our domestic industries and costs us jobs. My trade policy is quite simple, in addition to preserving the effectiveness of America's trade laws, I support measures that will increase American exports, and West Virginia exports specifically. Every $1 billion in exports supports about 17,000 jobs. So it follows that if we increase American exports, we will create more jobs here in the United States. And export related jobs are, on average, better, higher paying jobs. That is why I have worked so hard to introduce West Virginia businesses to foreign market opportunities. The ``Open Markets and Fair Trade Act of 1995'' is about market opportunities for American firms and especially markets for American industries with the most export potential and which promote critical technologies. Most importantly, it instructs the Commerce Department to look at markets which, if we can export there, offer the greatest employment opportunities for American workers. America cannot afford to be a market for everyone else's products when we don't get the same kind of access in return. Our economy, and the global economy, cannot sustain that kind of imbalance. The American people will only continue to support free trade if it means we are able to sell American products abroad as easily as Asian and European and Latin American manufacturers have access to our shelves and showrooms. While past negotiations should have made these points perfectly clear, the ``Open Markets and Fair Trade Act of 1995'' will erase any doubts that may have lingered with our trading partners. Mr. President, I ask that following my statement the full text of the ``Open Markets and Fair Trade Act of 1995'' appear, followed by a summary of S. 756. The material follows:

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, assuming that this is free time, I ask unanimous consent that the Senator from California, Senator Feinstein, be allowed to speak for 10 minutes.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. ROCKEFELLER

Mr. ROCKEFELLER. Mr. President, I am rising to talk about a problem that persists year after year, and a bill to do something about it. I'm speaking of our trade deficit, which is out of control. Certainly, we are making progress on some micro-economic levels, and the Clinton administration has hammered out more than 70 different trade agreements over the last 2-plus years--14 with Japan alone. These are helping some industries, some workers, and some parts of our economy. But they have done nothing to shrink the trade deficit. Clearly, more must be done. The bill I am introducing today, the Open Markets and Fair Trade Act of 1995, will evaluate the current conditions of markets around the world for American products and negotiate access to those markets. It also gives the President and Congress a new tool to use in those negotiations--the threat of reciprocal trade action. Basically the bill tells our trading partners that if they refuse to give our products reasonable market access, we may impose the same kind of restrictions on their products. For example, under this legislation, if negotiations with the Japanese over the aftermarket for autoparts reached an impasse, the President could come to Congress and seek a reciprocal trade action that establishes a regulation that matches their strict regulations on repairing cars, which today serve to effectively keep most American replacement parts off Japanese cars. These restrictions only serve to help the Japanese producers and harm American manufacturers. In fact, along with American companies and American workers, the Japanese consumer is probably the biggest loser in the equation. It costs them about $600 for a new alternator in Tokyo--the same part in the United States costs about $120. A muffler sells for about $82 in the United States, and $200 in Japan. And a shock absorber set costs about $230 here, and over $600 in Tokyo. The New York Times ran a story on May 2 that couldn't be more timely. Even with the dramatic rise of the yen, they reported that it still costs $5.35 for a Florida grapefruit in Japan. And a can of Campbell's chicken noodle soup cost 220 yen today, the same as in 1991--when the dollar was more than 50 percent stronger. If the price of the soup had dropped to match the rise of the yen, a can of Campbell's soup would cost about 125 yen today, not 220 yen, or $2.75, as it is now being sold in Tokyo. It is clear that the savings that should accrue from the strength of the yen never passed on to the Japanese consumer. But let me stress, this bill does not single out Japan. I want to pry open markets wherever they're closed, wherever in the world American products are denied access. Our trade deficit with Japan was $65 billion last year; with China it was $30 billion; we had a deficit of almost $14 billion with Canada, and Germany rang in at $14 billion. Mr. President, following my statement, I would like to include a chart that lists the top 10 countries in which America has a trade deficit. While not all of these countries have barriers of the sort that this bill seeks to eliminate, a number of them clearly do. Again, this bill does not specify one country or another, it is about following up on the Uruguay round and looking beyond tariffs--it is designed to deal with market barriers; the internal rules in various countries that are practical impediments to American businesses. I am seeking to open more markets across the globe in order to bring about the increased exports and jobs that GATT promised. And I think it's high time we question the wisdom that blames almost all of America's trade deficit problems solely on ourselves. For years, we've heard the same assertions: ``Americans spend too much and save too little . . . the budget deficit is too high . . . we are growing faster than other countries so we have more money to spend than you.'' Yes, these economic realities contribute to the problem, but under President Clinton's leadership, we have reduced the Federal fiscal deficit by over $700 billion, yet the trade deficit goes up and up. I think it's time we reverse the premise and look at how the trade deficit fuels our savings and debt problems. The inability of American companies elsewhere costs our corporations profits, our workers job opportunities, and our Nation revenues--all of which weigh down our own economic growth and add to our fiscal deficit. Whether it is a requirement for American firms to hire local agents to conduct business; cumbersome inspection and customs procedures; bans on the sale of products for dubious claims of national sovereignty or some other sort of prerogative, the simple fact is that protected sanctuary markets abroad are a major contributor to America's economic problems. To explain this simply, I will use as an example the well-known case of how Japanese manufacturers sell things like electronics in the United States at such cheap prices, even when the yen is at a record height. I am citing Japan here, but it could be any other country that has a ``sanctuary'' market. It is well-known that many Japanese-made products are cheaper in the United States than in Japan. That is because Japan's closed market is a sanctuary that effectively insulates producers from competition, and allows them to over-charge Japanese consumers, giving them enough of a profit margin at home to sell below cost here. That means American companies lose on both ends. We can't export into these markets, and their subsidized exports harm our domestic industries and cost us jobs. My trade policy is quite simple, in addition to preserving the effectiveness of America's trade laws, I support measures that will increase American exports, and West Virginia exports specifically. Every $1 billion in exports supports about 17,000 jobs. So it follows that if we increase American exports, we will create more jobs here in the United States. And export related jobs are, on average, better, higher paying jobs. That is why I have worked so hard to introduce West Virginia businesses to foreign market opportunities. While this bill will expose countries with whom we have a trade deficit to extra scrutiny by the Commerce Department, the Open Markets and Fair Trade Act of 1995 is about market opportunities for American firms and especially markets for American industries with the most export potential and which promote critical technologies. Most importantly, it instructs the Commerce Department to look at markets which, if we can export there, offer the greatest employment opportunities for American workers. America cannot afford to be a market for everyone else's products when we don't get the same kind of access in return. Our economy, and the global economy, cannot sustain that kind of imbalance. The American people will only continue to support free trade if it means we are able to sell American products abroad as easily as Asian and European and Latin American manufacturers have access to our shelves and showrooms. While past negotiations should have made these points perfectly clear, the Open markets and Fair Trade Act of 1995 will erase any doubts that may have lingered with our trading partners. Mr. President, I ask unanimous consent that additional material be printed in the Record.