William Roth

Mr. ROTH

Mr. ROTH. Mr. President, I ask unanimous consent that the Senate immediately proceed to executive session to consider the following nominations on the Executive Calendar: No. 231 and 233; and the nominations on the Secretary's desk in the Air Force, Marine Corps, and Navy. I further ask unanimous consent that the nominations be confirmed, the motions to reconsider be laid upon the table, any statements relating to the nominations be printed in the Record, the President be immediately notified of the Senate's action, and the Senate then return to legislative session.

Mr. ROTH

Mr. ROTH. Mr. President, for the information of all Senators, the Senate will convene on Monday at 12 noon and be in a period of morning business until 3:30 p.m. By previous order, at 3:30 p.m. the Senate will begin consideration of two resolutions that were introduced today regarding education. The Lott and Daschle resolutions will be debated concurrently for 2 hours, and the Senate will then proceed to two stacked votes. Therefore, Senators can expect the first vote on Monday at approximately 5:30 p.m. Following the votes, the Senate may begin consideration of any conference reports, appropriations bills, or nominations available for action.

Mr. ROTH

Mr. ROTH. Mr. President, if there is no further business to come before the Senate, I now ask unanimous consent that the Senate stand in adjournment under the previous order following the remarks of Senator Coverdell.

Mr. ROTH

Mr. ROTH. Mr. President, I ask unanimous consent this bill be read a third time and passed, the motion to reconsider be laid upon the table, and that any statements relating to the bill be printed in the Record.

Mr. ROTH. Mr. President, I ask unanimous consent that the Senate now proceed to the immediate consideration of S. 1637 introduced earlier today by Senator Lott.

Mr. ROTH

Mr. ROTH. Mr. President, I rise today to discuss an important--a historically important--vote taken in the course of our recent deliberations on defense policy. I am speaking of the rollcall vote this Chamber took on May 25 requesting the long-overdue, posthumous advancement of two fine World War II officers, Adm. Husband Kimmel and Gen. Walter Short. The Senate voted in support of the Kimmel-Short resolution, and I wish to take a moment to underscore the historic import of that vote. As you may recall, Admiral Kimmel and General Short were publicly and wrongly accused of dereliction of duty and unfairly scapegoated with singular responsibility for the success of the fateful December 1941 attack on Pearl Harbor. After the end of World War II, this scapegoating was given a painfully unjust and enduring veneer when Admiral Kimmel and General Short were not advanced on the retired lists to their highest ranks of war-time command--an honor that was given to every other senior commander who served in war-time positions above his regular grade. After over 50 years, this injustice remains a prominent, painful spur in the integrity of our Nation's military honor. After numerous official investigations totaling well over 30 volumes of thick text absolved these officers of dereliction of duty and highlighted gross negligence and ineptitude on the part of their superiors as predominant factors in the Pearl Harbor disaster, these officers still remain unfairly treated. For those of you who are interested, I will shortly send to the desk for placement in the Congressional Record a set of excerpts from these investigations. This is a short document, but it poignantly highlights how unjust treatment endured by Kimmel and Short just does not correlate with the official history--the official documented history-- of the Pearl Harbor disaster. Anyone who looks over these few pages cannot but feel uncomfortable with how our Nation has so unfairly turned its back on these two officers who dedicated their lives to our own freedoms. Mr. President, a great step, indeed an historic step was taken toward the correction of this injustice last May, on May 25 to be exact. This Chamber, the U.S. Senate, the legislative body our Constitution deems responsible for providing advice and consent in the promotion of military officers, voted and passed an amendment to the Senate Defense authorization bill that stated: This singular exclusion from advancement of Rear Admiral (retired) Kimmel and Major General (retired) Short from the Navy retired list and the Army retired list, respectively, serves only to perpetuate the myth that the senior commanders in Hawaii were derelict in their duty and responsible for the success of the attack on Pearl Harbor, and is a distinct and unacceptable expression of dishonor toward two of the finest officers who have served in the Armed Forces of the United States. This resolution then requested the President to advance the late Rear Adm. Husband Kimmel to the grade of admiral on the retired list of the Navy and the late Maj. Gen. Walter Short to the grade of lieutenant general on the retired list of the Army. Mr. President, the injustice suffered by Admiral Kimmel and General Short remains a flaw in the integrity of our Nation's chain of command and its unparalleled military honor. In this regard, the Senate's vote on the Kimmel-Short resolution was of great historic importance. The Senate has every right to be proud of this vote. This Chamber, which under the Constitution is responsible for promotion of military officers of our Armed Forces, deemed the treatment of Kimmel and Short to be unfair and unjust and inconsistent with our national sense of honor. That vote gave formal and official recognition to this injustice and highlighted it as a pernicious inconsistency in the application of our national understanding of military accountability. It demonstrated that no wrong, no matter how distant in the past will be ignored by this Chamber. it correctly called upon the President to correct this injustice by advancing these two fine officers on the retired lists. It is now up to the President to take this corrective action. I hope that he will not heed the contradictory conclusions of his advisors on this matter. While the Pentagon opposes the advancement of Kimmel and Short, they nonetheless recognize that, and I quote their own 1995 report, ``responsibility for the Pearl Harbor disaster should not fall solely on the shoulders of Admiral Kimmel and Lieutenant General Short, it should be broadly shared.'' How they square this conclusion with the reality that today Kimmel and Short are the only two officials to suffer from official sanction is beyond me. I hope that the President of the United States will use his wisdom to listen beyond this contradictory and unjust advice. I hope that he will look at the official record compiled by over eight official investigations. I hope that he will listen to the studied voice of the Senate and take the final step necessary to correct this injustice by advancing these two fine officers to their highest grade of World War II command on the retired lists. Mr. President, the Senate has once again ably demonstrated that it is never too late to correct an injustice. I urge the President of the United States to do the same and advance Kimmel and Short to their highest grade of command as was done for their peers who served in World War II. Mr. President, I ask unanimous consent to have an attachment printed in the Record.

Mr. ROTH

Mr. ROTH. Mr. President, I ask unanimous consent for 20 minutes as in morning business.

Mr. ROTH

Mr. ROTH. Mr. President, over the couse of the next several months, countless ``lessons learned'' studies assessed Operation Allied Force will be conducted by NATO authorities as well as by our armed services, our own Committees here in Congress, and their counterparts found among our NATO allies. What I wish to do today is to approach this matter of ``lessons learned'' from the vantage point of one who regards the NATO Alliance to be a vital interest of the United States. I want to ensure that NATO's experience in Kosovo contributes to an Alliance that is better prepared for the challenges it will face in the next millennium. The conflict over Kosovo was NATO's first war, and the Alliance did win. Operation Allied Force forced the regime of Serbian Prime Minister Slobodan Milosevic to withdraw his forces from Kosovo. It thereby ended the systematic brutality that regime exercised against the province's Albanian population. It was in many ways a military campaign of unprecedented success. Not a single NATO airman lost his or her life to enemy fire in the course of over 35,000 sorties. Despite a few tragic errors, the bombing campaign featured unmatched accuracy and precision. However, while Operation Allied Force did attain victory, the accomplishment of its goals did not yield a shared sense of triumph and finality. This absence of triumph is the product of how NATO exercised its power in this war in light of the tremendous military advantages it had over its opponent, the forces of the Milosevic regime. Among NATO's first and foremost objectives in this war was to stop the atrocities then being committed against Kosovar Albanians. Yet, in the course of Operation Allied Force, Milosevic accelerated and expanded his campaign of terror. Before the war was over, nearly 90% of Kosovar Albanians were driven from their homes by Serbian para-military and military forces. Nearly one half were actually expelled from Kosovo. Moreover, no less than 10,000 Albanians were executed by Milosevic's henchmen during the course of the NATO campaign. As we learn daily from the grim excavations of body-filled wells and mass graves, the actual figure is probably much, much higher. And then there were the countless rapes of Albanian women, which for cultural reasons will unfortunately never be fully reported--all occurring during the course of Operation Allied Force. When assessing the lessons learned from the Kosovo war, we must not forget that the primary purpose of NATO's threats and then its bombing campaign was to prevent these tragedies from occurring. Then there are the facts concern the balance of power between NATO and Serbia. It took the Alliance 78 days to force Milosevic from Kosovo, a region that size of Los Angeles County whose population was 90% Albanian--a population that wanted NATO's support and that would have warmly welcomed Alliance ground forces as was done when Operation Joint Guardian commenced. That this campaign took 78 days is especially disturbing when one takes into account that, according to a Washington Post report, NATO was a standing force some 37 times larger than that fielded by Slobodan Milosevic and a combined economy that is 696 times larger than that of Serbia. These statistics do not come close to capturing the vast technological advantages NATO forces have over the Serbian military. That NATO won the war is obvious. That in the course of Operation Allied Force, NATO demonstrated its awesome capabilities is indisputable. But, when assessing the lessons learned from this war, one cannot avoid the haunting fact that its results included an acute and brutal increase in the suffering of the Kosovar population, that an Alliance of such power and magnitude took over two months to defeat an exponentially far weaker foe, and that in the aftermatch of Operation Allied Force, the regime that created this crisis remains not only in place, but belligerent. So what are the key lessons and issues raised by NATO's first war, a war that brought NATO victory yet, denied it triumph? The first and foremost lesson concerns the Alliance's political cohesion. Many have stated that NATO's greatest success in this conflict was that its 19 members hung together. There can be no doubt that this cohesion was rooted in the common values and interests that bind the 19 Allies. But in recognizing this, one must not overlook a central fact: The first lesson from Operation Allied Force is that the trust among Allied military personnel promoted by NATO is an invaluable reinforcer of the political cohesion binding NATO Allies. Allied unity in this war was never a given. Several allies floated proposals to temporarily halt the bombing campaign. Others publicly denied the use of their territory for forced entry into Kosovo or Serbia proper. NATO's political cohesion was vulnerable in an often very visible manner. The trust and unity fostered among allied militaries through fifty years of joint planning, training, command and operations significantly buttressed the durability of Alliance cohesion during the conflict. Unfortunately, I fear that the significance of this military bond may never be fully appreciated. I am disturbed that French Defense Minister Alain Richard recently asserted that the experience of Operation Allied Force has only further legitimized Paris' inclination to remain outside of NATO's Integrated Military Command. Quite the contrary, the war over Kosovo underscored the need for all Allies to become full members of that integrated command structure. It is an institution that facilitates and orchestrates more effective military operations by the NATO coalition. Its day-to-day operation is a cornerstone of trust and credibility that in times of crisis and war not only maximizes NATO's military effectiveness, but also its political unity. As I just stated, numerous studies assessing the strategy behind Operation Allied Force are underway. Much attention will be directed, as it should, toward the factors that contributed to Milosevic's capitulation. These, of course, include that regime's intensified international isolation, the actual damage done to its military and civilian infrastructure, the role of the KLA, and the influence of slowly increasing NATO ground force deployments around Kosovo, among others. We also need to ensure a fair and objective assessment of the Alliance's decision to tailor the bombing campaign around a strategy of gradual escalation. And, there has to be a thorough review of the decision to preclude the use of NATO ground forces for a forced entry into Kosovo. An important question will be whether a more severe and overwhelming application of force would have more effectively prevented the suffering that occurred in Kosovo over those 78 days. Because so much attention will be directed toward these issues and others related to what went right and wrong in Kosovo, we must, however, avoid the mistake of making Kosovo a singular template for NATO's planning and preparations for future conflicts. As a matter of prudence, we have to assume that the future will present contingencies that are more demanding than that which we encountered over Kosovo. Hence, the central focus of our assessments must be the following issue: Did Operation Allied Force demonstrate that NATO benefits from a force structure that can deploy on suitably short notice, be sustained over long distances, and readily provide Alliance leaders the option of swiftly delivering overwhelming force, be it from the sea, from the air, or from the ground? These are not new standards. The Alliance's Strategic Concept of 1991, which was updated in the course of the Washington Summit last April, postulated a NATO force featuring ``enhanced flexibility and mobility and an assured capability for augmentation when necessary.'' That same doctrine also called upon the Alliance to have available ``appropriate force structures and procedures, including those that would provide an ability to build up, deploy and draw down forces quickly and discriminately.'' With this in mind, NATO established in 1991 its ``Rapid Reaction Forces.'' So after eight years, just how rapid and overwhelming are NATO's forces? Operation Allied Force yielded a very mixed answer to this question. And, it generates concern on my part about the overall readiness of Allied forces, including those of our own country, and, thus, the overall health of the Alliance. First, it is clear that the Alliance's ability to deliver devastating firepower from the air emerges almost solely from the United States. The U.S. provided 70% of the aircraft flown in Operation Allied Force. And, an overwhelming majority of the precision guided missions launched in the conflict were American. While Allied Force demonstrated the awesome capacities of American air power, it also highlighted glaring shortfalls in European inventories, including: fighter-bombers; electronic jamming aircraft; advanced command, control, and communications capacities; intelligence capacities; and, precision-guided munitions. Instead of becoming a symbol of NATO power, Operation Allied Force emerged as a symbol of the imbalance that exists between the military capabilities of the United States and its Allies. While it is true that our allies are bearing their share of responsibility in Operation Just Cause, we cannot ignore the unequal capabilities the Allies bring to the forward edge of NATO's sword. The Alliance's singular dependence upon the United States is neither conducive to transatlantic unity nor is it the best way to provide an Alliance capability that is robust in the fullest sense of the term. An Alliance is simply not healthy if it is solely dependent upon the capabilities of but one member. It is, thus, especially disturbing that both France and Germany announced planned cuts in their defense budgets just weeks after the end of Operation Allied Force. It raises questions as to how seriously they take this matter. Second, the Kosovo war highlighted great gaps in inter-operability that divide Allied forces. No military commander has dedicated more time and focus on this urgent concern than General Klaus Naumann, who stepped down in April as Chairman of NATO's military Committee. He has repeatedly warned that ``the growing gap of capabilities which we see inside NATO . . . will lead to an inter-operability problem.'' Operation Allied Force showed that this inter-operability problem is not a matter of military theory, but that it is matter of real and urgent concern. As we all know, Serbian forces were given advance warning of Allied attacks, including specific targets, when Allied aircraft were forced to communicate over open and insecure radio channels because they did not benefit from suitably compatible and secure communications systems. This, needless to say, undercut the effectiveness of the bombing campaign. More importantly, it subjected Allied pilots to unnecessarily greater danger. Third, the Kosovo war highlighted the limited mobility of Allied forces. In April, I was disturbed to hear our nation's premier military experts assert that it would take months for the Alliance to deploy a ground force in the Balkans suitable for a forced entry into Kosovo or Serbia. Considering the relative size and capability of Serbia's armed forces to that of NATO and the proximity of Kosovo to available staging grounds for such a forced entry, this assertion does not reflect well on the mobility of NATO military capacities. This is a matter relevant not only to our European Allies, but also to the United States as well. As the Kosovo War demonstrated, not every conflict of the future will be like that of Operation Desert Storm where the United States was able to use literally months to build-up the offensive force necessary to expel Saddam Hussein from Kuwait. In 1991, NATO established its Rapid Reaction Corps. I repeat in 1991! Where was this corps and its rapidly deployable assets when NATO found itself confronted by a regime that was exponentially weaker and situated in its backyard, if not on its doorstep? These are not new issues nor new conclusions. Burden-sharing has always been an acute thorn in the side of Alliance unity. For several years, numerous European and American commanders, in addition to General Naumann, have been warning of the growing technology gap between the armed forces of the United States and Europe. And, NATO's own Strategic Concepts have been urging the Alliance to field forces that are rapidly deployable and assets that can sustain these forces over long distances and long periods of time. What is disturbing is that after nearly a decade, the need for such forces has been so loudly reaffirmed by the Kosovo war. Considering what can happen in war, Operation Allied Force provides a not-so-gentle reminder of the need to more seriously address these challenges. If one believes, as I do, that one has to assume that NATO will in the future face contingencies more challenging than that presented in Kosovo, it is imperative that NATO do more than study these issues. Alliance members must dedicate the resources necessary to overcome these shortcomings. To quote General Naumann again, what ``we require [is] action, and not just more paper declarations.'' In addition to reviewing and studying the insights provided by Operation Allied Force upon Allied military strategy and capabilities, we have to remember that NATO is first and foremost a political Alliance. The conduct and procedures used in the course of the Kosovo war by NATO's political authorities must also be reviewed and critiqued. It was discomfiting, to say the least, to observe inter-Alliance disputes over target lists emerge on the public scene. NATO stumbled in the first phase of the campaign when individual NATO heads of state were personally reviewing and squabbling over daily targets lists. These disputes, which concerned how to achieve ends through the use of force, raise a number of questions that must be addressed over the coming months. These include the following: Was Operation Allied Force an example of coalition warfare or a ``war by committee.'' Should the Alliance establish procedures that will further separate the political and diplomatic decisions defining the objectives of war as well as the decision to go to war from those military decisions through which the war is executed? In the course of Operation Allied Force, did the SACEUR benefit from the flexibility and freedom of action his office requires in the conduct of war? Are there alternative arrangements between the SACEUR and the NAC that the Alliance should consider? Does the SACEUR have sufficient command and control over his subordinate commanders? With regard to the last question, it has been widely reported that in the course of the NATO-Russia showdown over the Pristina airport, British Commander General Robertson refused an order from SACEUR General Clark to seize that airport prior to the arrival of the Russian battalion. General Robertson balked at the order and successfully appealed to his British senior political authorities to have that order rescinded. This example demonstrated the inherently political nature of NATO's multi-national command structures, one that warrants close examination. The questions I have raised constitute the core issues of coalition warfare. They are central to the Alliance's ability to sustain unity in times of crisis and conflict. They are also core issues of civilian control over the military, a cornerstone of democracy. While it is widely known that many NATO officers were not totally enamored of the political constraints they were dealt in Operation Allied Force, the evidence currently available indicates that they accepted and respected these constraints. They fully respected the authorities of their civilian leaders. That is another overlooked NATO success story in Operation Allied Force. In posing the aforementioned questions, the intention is not necessarily to yield structural change, but to ensure a fuller understanding of what to expect and demand of our Alliance's political and military leadership in times of conflict. In doing so we may be better able, and I quote again General Naumann, ``to find a way to reconcile the conditions of a coalition war with the principles of military operations such as surprise and the use of overwhelming force.'' That sustaining Allied unity was one of the success stories of Operations Allied Force is a fact that shows how NATO manages war is as important a matter as the capacities NATO brings to war. The Kosovo war also yielded lessons about another issue of great importance to the Alliance, the relationship between NATO and Russia. Over the last decade the alliance has made great efforts to transform that relationship into one of partnership. Toward that end, it invited Russia to join its Partnership to Peace Program, and in 1997 the NATO- Russia Founding Act was signed establishing a unique consultative relationship between Brussels and Moscow. This effort to build a genuine partnership must be continued, but it also must be pursued with greater realism. The Kosovo war was the first major test of the progress made in relations between the Alliance and Russia since the end of the Cold War. Moscow's conduct in the course of this conflict and its immediate aftermath demonstrated that while Russia may not be the protagonist it was in the Cold War, it is certainly not a partner, at least not today. To paraphrase Russia analyst Tom Graham, Russia is more often than not, sometimes purposely and sometimes inadvertently, a troublesome problem. A brief review of Russia's role in the Kosovo conflict underscores this point. First, remember that Russia still calls for NATO's dissolution. Second, from the very start of Operation Allied Force, Moscow harshly condemned the bombing campaign and sided with Slobodan Milosevic. Russia continued oil transfers to Serbia despite a request by nearly all other European democracies to impose an embargo. So- called ``Russian volunteers'' operated with Milosevic's forces in Kosovo and Serbia and with the blessing of Moscow authorities. Third, Russia's successful dash to Pristina and its airport required a great deal of coordination with Serbian authorities. Moreover, let us not forget that Russian and Serbian soldiers jointly manned roadblocks in Kosovo that impeded the movement of Allied units in the initial days of Operation Just Cause. Russia's conduct in the course of Operation Allied Force and its self-invited role in Operation Just Cause demonstrated the volatility that still characterizes Russia's foreign policy, particularly its approach to NATO. Russian participation in NATO diplomatic and military operations is a double-edged sword, and has to be treated as such, particularly when sensitive Alliance operations are at stake. Engaging Russia should remain a significant priority of the Alliance. Introducing greater realism to this effort does not mean isolating Russia. It does involve recognizing the difficult challenge of simultaneously promoting cooperation and mutual accommodation while avoiding propitiating risk-taking behavior by Moscow, such as that which occurred in Pristina. The lesson from Kosovo is that while we must engage Russia with the goal of creating partnership, greater realism and caution in this endeavor is more likely to yield more stable and enduring cooperation. The Kosovo war demonstrated the continued centrality of NATO to transatlantic security. It has demonstrated the awesome power that emanates from allied unity. It underscored the profound political and military pay-off that comes from fifty years of intensive military consultation, cooperation, coordination, joint planning, joint training, and all the day-to-day activities the Allied militaries conduct to protect and defend our common values and interests and peace. The war over Kosovo tangibly reminded us of the military and political challenges NATO will likely face in the future. It was a firm reminder of the need for the Alliance's force structure to become more mobile and more capable of rapid deployment. It was an urgent call for improvements in the inter-operability of Allied forces and in the balance of transatlantic military capabilities. And it provided the first test of NATO's ability to manage war in the post-Cold War era. As Operation Allied Force was NATO's first war, it is essential that we ensure that it is comprehensively reviewed. In objectively assessing what went right and wrong, we must keep our eyes upon NATO's future. We must also work to ensure that the lessons learned and relearned from Operation Allied Force will not just reside in dusty reports but actually prompt decisions and actions that improve NATO's ability to decisively manage the political and military levels of war. Mr. President, I have quoted General Klaus Naumann several times and wish to share with my colleagues the transcript of his farewell remarks of May 4, 1999, the last day of his tenure as Chairman of NATO's Military Committee. They provide sage advise concerning NATO's future from an experienced military commander, and I urge my colleagues to take the time necessary to review them. I ask unanimous consent they be printed in the Record.

Mr. ROTH

Mr. ROTH. Mr. President, I yield 6 minutes to the Senator from Minnesota.

Mr. ROTH. Mr. President, I yield 5 minutes to the distinguished Senator from Texas.

Mr. ROTH. Mr. President, I yield 5 minutes to the Senator from Wyoming.

Mr. ROTH. Mr. President, I yield 5 minutes to the Senator from Kansas.

Mr. ROTH. I yield 5 additional minutes.

Mr. ROTH. Mr. President, I yield myself such time as remains. I think it is 2 minutes. As I said this morning, the fundamental question before Congress these past few weeks, as we have debated the Taxpayer Refund Act of 1999, is quite simple: Is it right for Washington to take from the taxpayer more money than is necessary to run Government? The issue of tax relief isn't anymore complicated than that, and the outcome of the conference between the Senate and the House makes it clear that Government is not automatically entitled to the surplus that is, in large part, due to the hard work, thrift, and risk taking of the American people. Individuals and families are due a refund. That is exactly what we do with this legislation. We give the people a refund, and we do it in a way that is fair, broad based, and empowering. Mr. President, I am ready to yield back the remainder of time.

Mr. ROTH. Mr. President, I yield 10 minutes to the distinguished Senator from Idaho.

Mr. ROTH. I object.

Mr. ROTH. Mr. President, that report language is not correct. The conference agreement adopted section 1317 of the Senate amendment without modification.

Mr. ROTH. I agree that this is an issue of concern to Finance Committee members. The cellular telephone industry is a high-growth, job-creating, industry. It is clear to any observer that the industry is frenetically competitive. Companies incur substantial marketing expenses, including sales commission, to attempt to sign up new customers and to entice customers to move from other carriers. I have little doubt that the IRS's position requiring companies to capitalize the sales commissions may lead to years of litigation. The Treasury Department has made the decision to review the IRS's position. The agency included the issue in its 1999 Priority Guidance Plan and has advised the Committee that they plan to deal with the issue this year. I strongly support the quick resolution of this issue by the Treasury Department. Sales commissions are a basic cost of doing business for cellular telephone companies, and I believe that the Treasury should be able to reach a sensible resolution of this issue.

Mr. ROTH. I yield 5 minutes to the Senator from Oregon.

Mr. ROTH

Mr. ROTH. I yield 3 minutes on behalf of the minority.

Mr. ROTH. On behalf of the minority, I yield 1 minute.

Mr. ROTH. I yield 10 minutes on behalf of the minority to the distinguished Senator from Minnesota.

Mr. ROTH. Mr. President, I submit a report of the committee of conference on the bill (H.R. 2488) to provide for reconciliation pursuant to sections 105 and 211 of the concurrent resolution on the budget for fiscal year 2000, and ask for its immediate consideration.

Mr. ROTH. Mr. President, just so the record is clear, we have 6 hours, 3 hours to a side. The two managers have agreed we will go back and forth from one side to the other when people are present. But that is not the case now. So I yield 15 minutes on behalf of the minority to the distinguished Senator from North Dakota.

Mr. ROTH. Mr. President, the fundamental question before Congress these past few weeks, as we have debated the Taxpayer Refund Act of 1999, is quite simple: Is it right for Washington to take from the taxpayer more money than is necessary to run the Government? The issue of tax relief is not any more complicated than that, and the outcome of the conference between the Senate and House makes it clear that we believe Government is not automatically entitled to the surplus that is, in large part, due to the hard work, thrift, and risk- taking of the American people. Individuals and families are due a refund, and that is exactly what we do with this legislation. We give the people a refund. We do it in a way that is fair, broad based, and empowering. We do it in a way that will benefit nearly every working American, a way that will help restore equity to the Tax Code, and provide American families with the relief and resources they need to meet pressing concerns. This tax refund legislation will help individuals and families save for self-reliance in retirement. It will help parents prepare for educational costs. It will give the self-employed and underinsured the boost they need to pay for health insurance, and it will begin to restore fairness to the Tax Code by addressing the marriage tax penalty. How do we accomplish all of this? We begin by reducing our marginal income tax rates by a point. In other words, the 15-percent tax bracket will drop to 14 percent, and the 39.6-percent top rate will drop to 38.6 percent. The new 14-percent bracket will be extended upward to include millions of Americans who are now paying taxes in the 28- percent bracket. These changes will benefit individuals and families across the economic spectrum. For example, an individual with $40,000 of income will save over $700. An individual earning $50,000 will save over $800. Under this bill, a taxpayer with $70,000 of income will save over $1,000. This is significant tax relief. When fully phased in, a middle-class family of four with an adjusted gross income of $80,000 will save almost $3,000 a year. This is real savings, money that can be used by individuals and families to meet their pressing needs and objectives. To restore equity to the Tax Code, this legislation also meets a bipartisan objective by providing relief for the marriage tax penalty, and it does this by doubling the standard deduction and the 15-percent tax bracket for married couples filing jointly. We can all agree on how important this is. For too long, husbands and wives who have worked and paid taxes have been penalized by their dual incomes. This plan will address that inequity by giving working American couples greater relief. Let me give an example. Two individuals, each making $35,000 a year, face a penalty of almost $1,500 when they marry. Under this legislation, that penalty will be addressed in two ways: first, by doubling the standard deduction and, second, by doubling the 15-percent tax bracket to include their combined income. The marriage penalty relief offered in this bill retains the Senate position on the amount of relief received, and it even provides relief for people receiving the earned income tax credit. To help families with their education expenses, the legislation before us allows taxpayers to increase their contributions to education IRAs, or what will--under the provisions of this bill--be called education savings accounts. Allowable contributions will rise from $500 to $2,000 annually. And these funds will be available to meet expenses for all students, from kindergarten through college. Beyond increasing the level a family can save for education, this Tax Relief Act also makes interest earned on qualified State and private school higher education tuition plans tax free--a most important development, in my judgment. It also extends employer-provided educational assistance for undergraduate studies, and it repeals the 60-month rule on student loan interest deductions. This will allow individuals to claim tax deductions on interest that they pay on their student loan, without the imposition of a time limit. To help families meet health care and long-term care needs, this legislation provides a 100 percent above-the-line deduction for those who pay more than 50 percent of their health insurance premiums. This, of course, includes the self-employed. The plan also provides an additional personal exemption for those who care for an elderly relative in their home. As you can see, this legislation is, indeed, empowering; it addresses concerns that are vitally important in the lives of our families, coast to coast. It provides across-the-board tax relief. It addresses the marriage tax penalty. It makes education more affordable for all students--kindergarten through college. And it helps our families meet their health care and long-term care needs. But it doesn't stop here; it does much more. The legislation before us phases out the alternative minimum tax. It provides capital gains tax relief, simplifying the rate structure, and reducing the individual capital gains tax rate from 20 percent to 18 percent, beginning with the current 1999 tax year. For those individuals taxed at the lowest individual rate, their capital gains tax rate is reduced from 10 percent to 8 percent. In addition, the tax basis of certain assets may be increased by an ``inflation adjustment,'' so that any capital gain attributable to inflation is not subjected to tax. Also, we have maintained the 2 percent capital gains rate differential that is imposed on long-term capital gains from depreciable real estate, by reducing that rate from 25 percent to 23 percent. Another very important measure is the treatment of estate taxes. This legislation completely phases out and ultimately repeals the Federal estate, gift, and generation skipping taxes. It also corrects technical problems in the House provision. Each of these will be a powerful tool in the hands of taxpayers and families who will use these changes--their relief--to meet the needs that are unique to their situation. However, a couple of major provisions in this bill that I would like to outline in some detail will--like the across-the-board tax rate cut--benefit everyone, enabling individuals and families to prepare for self-reliance and success in retirement. These, of course, include the expansion of individual retirement accounts and pension programs. Under the bill, IRA contribution limits will be increased over the next 7 years until they reach $5,000. And taxpayers who are close to retiring will be allowed to make catchup payments in their plans. These changes will in my judgment, be incredibly beneficial. For example, an individual without an employer-provided pension plan, who contributes the maximum amount allowable, as it increases over the next 7 years-- with the magic of compounding interest--will be able to put away over $31,000 for retirement. In year 7 and beyond, he or she will be able to put away the full $5,000 annually. With the catchup provision--applicable for people over the age of 50--if those 7 years pass just prior to the taxpayer's retirement, the amount, for example, he or she could save in those 7 years under this bill would be over $44,000. This bill also increases the income threshold for those who can take full advantage of Roth IRA accounts up to $200,000 for a couple filing jointly. For employer-provided plans, this bill increases the maximum amount an individual can contribute to a 401(k) plan, a 403(b) plan or a 457 plan. Starting next year, an employee may contribute up to $11,000 to his employer's 401(k) plan In each year thereafter, he could contribute increasing amounts to his 401(k), and in 2005, he will be able to contribute a full $15,000. To show you how empowering this is, if John, a 35-year-old, contributes the maximum amount allowable over the next 30 years, his 401(k) plan benefit at retirement would increase by over $1.2 million. In addition, if John's employer established a newly added Plus Account program under its 401(k) plan, that amount would be nontaxable when John receives it at retirement. The Plus Account program--as addressed in this bill--lets an employer establish an account which has the same tax treatment as a Roth IRA. That means that John would have over $1.2 million in nontaxable income. Finally, this bill gives small businesses a new incentive to establish a retirement plan for their employees. The contribution limits for a SIMPLE plan--a defined contribution plan only for small businesses--have been increased in this bill to encourage small business owners to establish such plans. The incentive to establish a SIMPLE plan is easy to understand. Small business owners who offer SIMPLE plans will be able to save up to $10,000 in the plans they establish. This will be a great benefit to them, but in order to save their own money--as part of the SIMPLE plan--they will have to provide their employees with a contribution to their own plans of up to 2 percent of their salary. At the same time, under this plan the employees could also receive a matching contribution from their employer of up to 3 percent of compensation if they decide to contribute to the SIMPLE plan. Now, I believe this is good policy. It will encourage Americans to take advantage of these opportunities and provide for their retirement future. As with almost every provision in this Taxpayer Refund Act, the catalyst is the individual and the family, using tax relief to meet their needs. Every measure I have outlined as part of the Taxpayer Refund Act of 1999 is important, as each rightfully returns resources that Americans can use to meet their current needs, and the refund being offered comes from surplus funds. In other words, this broad- based tax relief package can be passed, signed into law, and, indeed, still leave sufficient resources in Washington to take care of Social Security, Medicare reform, and other necessary Government obligations. Let me repeat that: This broad-based tax relief package can be passed, signed into law, and still leave sufficient non-Social Security funds available to address comprehensive Medicare reform, including a prescription drug benefit. We can offer this relief and still pay down the debt and keep the budget balanced. We can do all of this for one very simple reason: The work, the investment in job creation achieved by Americans everywhere, has succeeded in creating long-term economic growth. As I have said before, it is not right that the reward for this success is that today our taxes are the highest percent of our gross national product of any time in postwar history. After paying for the Government programs for which Congress has planned and budgeted, a refund from the surplus must now be returned to the American taxpayer. I know there is wide agreement that Americans deserve relief. This is the bill that will give them relief. We must and should support it. We must keep in mind that major tax cuts must be done through the reconciliation process. This is, indeed, a lengthy, time-intensive process. We have successfully completed it. I am proud to say that this conference report, as it stands today, carries no provision that was not in either the House or Senate bill. In other words, nothing extraneous was added in conference. It is clean and representative of the direction received by those who crafted the Senate and House bills. Frankly, this is a first in tax history. It represents a tremendous amount of work by our colleagues, Members of the House, and the staff in both Chambers. Those who believe we may be coming back to do this again in September are mistaken. This is the tax bill for this year. We won't have a second chance on this. When we come back after recess, our time and attention will be focused on Medicare reform, a vital issue that concerns us all. For those who are concerned that this major relief package may be too big, please be reminded that there are important trigger mechanisms included in this bill. If we don't continue to reduce the payment on the interest on the national debt--let me repeat that--if we don't continue to reduce the payment on the interest on the national debt, then the tax relief included here will be reduced to compensate accordingly. Well, the bottom line is that this is tax relief in which we can have confidence. It meets the criteria we established before we began. It is fair. It restores equity to the Tax Code and makes education more affordable. It helps taxpayers prepare for self-reliance and retirement. This legislation will help families keep their homes, their farms, and businesses safe from death taxes. It makes health care more affordable. I believe these are objectives that are shared by everyone. They are objectives that can be embraced by Senators and Congressmen on both sides of the political aisle. Mr. President, I encourage my colleagues to vote for passage, and I yield the floor.