William Roth

Mr. ROTH

Mr. ROTH. Mr. President, I'm pleased that we are moving toward passage of this significant bill. The importance of giving American families the resources and means they need to educate their children must be above politics. Before I get into the specific benefits of the bill, let me remind my colleagues that with the exception of several school construction bond provisions--which were newly added this year--all of the concepts in this bill should be very familiar. Mr. President, these concepts should be familiar because we have already endorsed them. The base provisions in the bill--which include the increase in the maximum allowable contribution to an education IRA, the use of the IRA for elementary and secondary school expenses for public and private schools, the tax-free treatment of state sponsored prepaid tuition plans, and the extension of tax-free treatment for employer provided educational assistance--all received bipartisan support from the Senate as part of the Taxpayer Relief Act of 1997. Despite this Senate support, these provisions were dropped from the bill during conference negotiations. Because of opposition from the Administration, these particular elements failed to be included in the final version of the Taxpayer Relief Act of 1997. Today we will show our commitment to these provisions--and to enact what this body has already determined makes good sense for American families. Mr. President, it is important to note that this tax bill is not designed to answer all of the education-related issues that face this country. Those issues are too varied and complicated to be addressed by the federal government. They need to be solved at the state and local level--by schools, teachers, and parents working together. Instead, this bill is designed to build on the innovative concepts that have been introduced in the last few years. Our goal is to improve the tax code so that it provides the necessary incentives to help American families help their children. These are much needed tools. Over the past 15 years, tuition at a four year college has increased by 234%. The average student loan has increased by 367%. In contrast median household income rose only 82% during this period and the consumer price index rose only 74%. Our students--our families--need these resources to help them meet the costs and realize the opportunities of a quality education. The Senate recognized the importance of these provisions less than one year ago, voting in favor of them. I hope that my colleagues continue to recognize just how important they remain. The American people are counting on us. The various provisions of this bill are important measures that will aid our students and parents. The first major change in this bill increases the maximum education IRA contribution from $500 to $2,000. That increase is important on two levels. First, with the well-documented increase in education costs, it is essential that we provide American families with the resources to meet those costs. I have long argued that it is essential to change the savings habits of the American people, and there are few things more important than the education of their children. Not only will saving in this way increase our investment capital, it will increase American's education capital as well. Anything that thwarts either of these objectives is short-sighted. By using the tax code to encourage individual responsibility for paying for educational expenses, we all benefit. The expansion of the education IRA will result in greater opportunities for individuals to save for their children's education. Mr. President, the next major change that this bill makes to education IRAs is that it allows withdrawals for education expenses for elementary and secondary schools and for both private and public schools. As we recognized last year, it is a fundamental principle that a parent should have the right and the ability to make decisions about his or her child's education--to decide basic questions such as how the child should be educated and where the child should attend school. This bill recognizes that just like for secondary schools, we should not establish a priority system where some elementary and secondary schools are favored over others. We should not forget that it is the taxpayer who funds the education IRA--that it is the parent who puts his or her hard-earned money into the education IRA. Mr. President, it seems a matter of common sense, therefore, that the parent should be able to choose how to spend that money. Mr. President, another provision in this bill makes state-sponsored prepaid tuition plans tax-free, not simply tax-deferred. This is a significant distinction, because it allows students to withdraw the savings that accumulate in their pre-paid tuition accounts without paying any tax at all. It means that parents have the incentive to put money away today and their children have the full benefit of that money, without any tax, tomorrow. As I have already mentioned, forty-four states have pre-paid tuition plans in effect, and the other six are in the process of implementing such plans This means that every member of the Senate has parents and students back home who either benefit from this plan right now, or will benefit from this plan soon. Mr. President, the Coverdell bill also extends tax-free treatment of employer provided educational assistance for graduates and undergraduates through the year 2002. This particular program is a time-tested and widely used benefit for working students. Over one million workers across America receive tax- free employer provided education. This allows them to stay on the cutting edge of their careers. It benefits not only them, individually, but their employers and the economy as a whole. With the constant innovations and advancing technology of our society, it is vitally important that we continue this program. The various provisions that I have just described are all ones that members of this body approved last year. They made sense then. They certainly continue to make sense today. Mr. President, the Coverdell bill does even more than address the costs of attending school. In response to concerns from Members on both sides of the aisle, the Finance Committee agreed on some measures to provide targeted relief in the area of school construction. The first provision is directed at high growth school districts. It expands the tax-exempt bond rules for public/private partnerships set up for the construction, renovation, or restoration of public school facilities in these districts. In general, it allows states to issue tax-exempt bonds equal to $10 per state resident. Each state would be guaranteed a minimum allocation of at least $5 million of these tax- exempt bonds. In total, up to $600 million per year in new tax exempt bonds would be issued for these innovative school construction projects. This provision is important because it retains state and local flexibility. It does not impose a new bureaucracy on the states and it does not force the federal government to micro-manage school construction. Mr. President, there is a second bond provision in this bill. That provision is designed to simplify the issuance of bonds for school construction. Under current law, arbitrage profits earned on investments unrelated to the purpose of the borrowing must be rebated to the Federal government. However, there is an exception--generally referred to as the small issuer exception--which allows governments to issue up to $5 million of bonds without being subject to the arbitrage rebate requirement. We recently increased this limit to $10 million for governments that issue at least $5 million of public school bonds during the year. The provision in the Coverdell bill increases the small issuer exception to $15 million, provided that at least $10 million of the bonds are issued to finance public schools. Mr. President, it is clear that the Coverdell bill contains numerous important provisions for the American family. As I have said already, many of these measures are ones that the Senate passed last year. Anyone--students or parents--who is on the front line dealing with the costs of a quality education, must have been disappointed last year when we failed to give them all the tools that they needed. American families understand the need for these measures. They have now been waiting for a year. I am pleased today that we will, once again, address the needs of American families and students. I urge my colleagues to support the Coverdell bill. Mr. COVERDELL addressed the Chair.

Mr. ROTH

Mr. ROTH. Mr. President, I yield myself 2 minutes. First of all, I want to point out again that we have no quarrel with respect to the importance of technology and technical training. We think that it is of key interest. But at the same time we think its critically important to recognize that other types of training for teachers are equally important. For example, taking programs to better learn how to teach the disabled is certainly a top goal and desire, or to teach math or English to our children. All of these are worthy goals, and our concern is that by singling out technology we would be hurting others who have interests of similar importance. I am also concerned about the complexity this proposal writes into the Tax Code. One of the constant complaints--and I think a justified complaint--is that we are always making the Federal code more difficult, more complex to administer.

Mr. ROTH. Mr. President, I rise in opposition to this amendment to increase the charitable deduction to 110 percent of any contribution made to an educational institution if the contribution is used to provide scholarships for low-income families. Education is paramount to the future of our children and nation, and contributing toward the education of another is certainly one of the finest forms charitable giving can take. Let me also say that I know the distinguished Senator from Indiana has the best intentions with this amendment. I generally believe that charitable giving serves disadvantaged people much better than government programs. However, there are several concerns that I believe need to be fully examined and addressed before we consider moving down a road that provides a charitable tax deduction in excess of the amount donated. This is a serious departure from settled tax policy principles. Once we begin to offer charitable tax deductions that are more than the amount donated for low-income scholarships, what comes next? What other kinds of tax benefits will be proposed where the amount of the deduction exceeds the cost to the taxpayer? Should these kinds of scholarships be the only charitable activities enjoying this benefit? And, if not, are we prepared to move forward with such a precedent? There are other concerns I have about the Senator from Indiana's proposal. On what basis does one decide that the percentage should be 105, 120 percent, or a percentage lower than 100 percent? Should we be in the position of choosing among charities and assigning percentages? Another concern I have is the proposal's attempt to single out one kind of charitable activity and offer it special tax advantages. Why is this kind of charitable activity better than other charitable activities? To do so is a step towards complexity in the tax code. Mr. President, I believe charitable giving is an activity that we must continue to encourage with tax benefits. For instance, most taxpayers do not itemize, and therefore, cannot deduct their charitable contributions. This is a feature of our tax policy that concerns many members. This issue, along with other proposals in the charitable giving area, such as the one from the Senator from Indiana, should be reviewed when the Finance Committee holds hearings on fundamental tax reform. Mr. President, Senator Coats' amendment is well-intended, but raises too many questions to be hastily considered in a Senate floor vote. Let's pass the Coverdell bill, and deliver to taxpayers education tax incentives we have previously debated and approved. I urge my colleagues to oppose this amendment.

Mr. ROTH. I yield myself 1 more minute. So, I say that one of the problems with this proposal is that it adds an additional complexity that is going to be harder to administer and require the creation of a new bureaucracy. Let's keep and treat all people in this situation the same. The other point I want to make is that the benefits of the Coverdell amendment do not go to the wealthy. I point out that 70 percent of the benefits of the Coverdell education IRA go to families making $75,000 or less. I point out that a blue-collar worker can easily be making $40,000 with overtime; his spouse or her spouse working as a teacher, or otherwise, can be within this range. I defy anyone to go out and ask any of these people whether they consider themselves to be wealthy. The answer will be no. Mr. President, I yield back the remainder of my time.

Mr. ROTH. No; I reserve the remainder of my time.

Mr. ROTH. Mr. President, I rise in opposition to this amendment. I rise in opposition because it takes away the ability of parents to use educational IRAs to pay for expenses relating to the schooling of their children between kindergarten and 12th grade. Allowing parents greater resources to meet the educational needs of their young people is a very important part of the Coverdell legislation. Senator Levin proposes to take those resources away and give them to teachers by expanding the lifetime learning credit for those who participate in technology training. No one can argue that helping teachers become more proficient in technology is not a good thing. It is vitally important. It will have a positive influence on their ability to teach our children. However, to increase the lifetime learning credit for teachers at the expense of expanding the IRAs for our children runs contrary to the needs and objectives of American families. Mothers and fathers need increased wherewithal to support their children's educational goals. Mothers and fathers need stronger, more useful IRAs. They need the ability to use more of their own hard-earned money to take care of family priorities. The Senate recognized this last year when we gave parents with children in grades K-12 the ability to use educational IRAs. Our objective was to strengthen mom and dad's ability to get the best education possible for their children. Our objective remains the same today. This is what the Coverdell legislation is all about, empowering families to make decisions that are in their best interests, allowing them to use their own resources for their own benefit. Remember, Mr. President, the money in question here belongs to the taxpayers. They earned it. It is theirs. They will save it, and they should be able to choose how it will be spent. Let them use it where it serves them best--on their children. Senator Levin's amendment is well intentioned. A lifetime learning credit is a provision that was included in the Taxpayer Relief Act of 1997. It allows everyone pursuing postsecondary education to take a tax credit each year equal to 20 percent of their qualified expenses. Those expenses are limited annually to $5,000 through the year 2002, and starting in the year 2003 they will be annually limited to a total of $10,000. The lifetime learning credit is available to any taxpayer who meets the income requirements. Full-time students can take the credit, as can any professional who wants to continue his or her education. And this includes teachers, engineers, or research scientists. What Senator Levin proposes is to single out teachers and increase their lifetime learning credit to 50 percent for technology training. Not only would this come at the expense of students and their families but it would be inequitable among the professions. Remember, teachers can already receive a 20 percent credit for any additional education in which they engage. The fact is, Senator Levin's amendment goes too far too fast and it comes at the expense of the children. This amendment takes the means to use expanded IRAs to educate children, and it creates a more complex and distorted learning credit. Not only will meeting the criteria to qualify for the credit create a bureaucracy to determine what conditions qualify, but it emphasizes one area of study over another. For example, why give a 50 percent credit for teachers to become more proficient in using and teaching technology but only give a 20 percent credit to those who take courses to become better reading instructors? Or we could ask the same question. What about the teacher who takes courses to enable them to better teach those who are disabled? All worthy goals. And the problem here is that we would single out one to benefit over the others, which only adds to the complexity of this matter. This is not what we want to do. Ask the parents of America. Ask our families. Ask our students how they would choose to use the financial resources in question. I believe the vast majority would make it clear that they want the opportunity to use their money to give them greater flexibility and power to meet the educational objectives of the family. Mr. President, I must oppose the Levin amendment. The educational IRA is the foundation of the Coverdell bill. This modification guts the bill at the expense of the children. For that reason I oppose this amendment and urge my colleagues to do the same. Mr. President, I reserve the remainder of my time. I yield the floor.

Mr. ROTH

Mr. ROTH. Mr. President, I believe that, in the normal order of things, as the manager of the bill, I would be next to address the amendment proposed by the distinguished Senator from Illinois.

Mr. ROTH. I yield myself 10 minutes. Mr. President, I oppose the amendment offered by the distinguished Senator from Illinois for two reasons. First, it is important to understand that the amendment strikes section 101 of the Coverdell bill. This section is the very heart of the legislation, for it is the provision that provides the most widespread benefits for American families. This section increases the maximum contribution to an education IRA from $500 to $2,000. It permits the education IRA to be used for elementary and secondary school expenses, and it permits the education IRA to be used for public and private schools. I have already spoken numerous times about the importance of making these changes to the education IRA. In fact, the Senate has already endorsed these changes as they were all included in the Senate version of the Taxpayer Relief Act of 1997. The provisions made sense at that time, and they continue to make sense today. Our students and our families need these resources and the benefits of an education IRA to help them meet the cost and realize quality education. I hope my colleagues continue to recognize just how important this tool can be for the American people. Mr. President, a second reason I oppose this amendment is that, in effect, it would create a massive Federal mechanism whose stated purpose is to spur the construction and rehabilitation of public schools. It appears to be the same proposal contained in the administration's fiscal year 1999 budget, and it would create a new type of bond called a ``qualified school modernization bond.'' Unlike regular tax-exempt bonds, like those already in the Coverdell bill where holders receive tax-exempt interest payments, the holders of these new ``qualified school modernization bonds'' would receive a Federal tax credit in an amount to be set by the Treasury Department. This amendment provides that a total of $19.4 billion worth of these school modernization bonds could be issued around the country over the next 2 years. It also increases the amount of qualified zone academy bonds by $2.4 billion over 2 years. Even more massive than the amount of bonds to be issued under the proposal is the bureaucracy that would be created to administer this program. The Treasury would need to establish a formula to allocate the school modernization bonds. The amendment calls for half of the bonds to go to the 100 largest school districts with the largest number of low-income children. The other half of the bonds would go to the States and Puerto Rico divided in proportion to their share of Federal assistance. This would be according to the basic grant formula of the Elementary and Secondary School Act of 1965. Then all of this would be readjusted for allocation to the 100 largest school districts. This runs contrary to President Clinton's promise that the ``era of big government is over.'' It runs contrary to our objective to strengthen schools by empowering families and communities. It consolidates ever-increasing power in the hands of a few Federal bureaucrats while it robs our families and communities of local control over their schools and precious financial resources. Not only does the Moseley-Braun amendment create more bureaucracy in the way that it requires the Federal Government to sift through the criteria and bond allocation process, but it calls on the Federal Government to oversee another massive program. According to this amendment, a bond would only be deemed to be a qualified school modernization bond if the Federal Department of Education signs off on it. The Federal Department of Education would have to approve the school construction plan of the States or eligible school districts. By giving its OK, the Federal Department of Education is supposed to consider whether--I am quoting from the administration's description of its proposal: The school construction plan must, one, demonstrate that a comprehensive survey of a district's renovation and construction needs has been completed; and, two, describes how the jurisdiction will assure the bond proceeds are used for the purposes of this proposal. If we are to meet the education needs of our children and the challenges of the future, we need less bureaucracy, not more. We need greater involvement in oversight from our parents and communities, not less. We need a Federal Government that supports the best and most innovative programs and policies implemented by our States and local school boards, not one that takes them over. The bond proposals in this amendment are modeled after a much more limited measure that was included in the 1997 tax bill at the request of Congressman Rangel and the administration. The 1997 bill created ``qualified zone academy bonds.'' The purpose of these bonds was to provide additional incentives for private entities to get involved in school construction. Holders of the qualified zone academy bonds, all of whom have to be in the business of lending money, are to receive a tax credit instead of an interest payment, and the amount of qualified zone academy bonds for 1998 and 1999 was capped at $400 million per year. The qualified zone academy bond program was deliberately kept small for several reasons. First, there was a fundamental concern about the Federal Government taking on the traditional State and local responsibility for school construction. Second, it was unclear whether the academy bond program would place funds where they need to be, in the hands of local schools. Nevertheless, here we are, less than 1 year later and the push is on for a massive expansion of what is nothing more than an untested proposal. The attempt with this amendment is to authorize almost $22 billion in all-school bonds, and this attempt is being made without any data that the bond mechanism in the amendment is the most efficient or beneficial way to help States and localities deal with school modernization. It is simply unclear whether issuing a new type of bond, no matter how catchy its name, will ultimately result in schools being modernized. What is clear is that it once again falls back on the failed notion that Washington knows best. It assumes that creating layer upon layer of unneeded bureaucracy within the Department of Education is a far greater solution than giving parents and local communities greater control over the education of their children. Under the proposal, the Department of Education would be required to approve the school construction plan of a State or eligible school district. This means that the bureaucrats from Washington would be micromanaging a local school district's renovation plans--in effect, second-guessing and even directing the decisions of State and local officials. It also means that parents, local leaders, and school districts would have to watch as their vital financial resources are commandeered by Washington, DC, and sent out to build and renovate schools elsewhere despite the fact that they themselves might desperately need improvements in their own community schools. This amendment strikes right at the heart of local control. It gives the Department of Education the final say about how a school district should address its construction and renovation needs. It allows the Department of Education in Washington to tell local officials that they have misjudged the needs of their district. This is wrong. Local officials are the people who are on the front lines every day. They know the needs of their students. They are directly accountable to parents. It seems only a matter of common sense that they are the ones who best understand the need of their district and the best ways to fix any problems. Yet this amendment would set up a structure whereby the availability of this Federal tax benefit is controlled by Washington and not by the localities. As the Department of Education would be required to monitor whether the bond proceeds were being used for the stated, appropriate renovation plan, Washington bureaucrats would have an ongoing supervisory role. It just does not make sense for the Department of Education to get involved at this level. President Clinton himself stated in 1994 that ``the construction and renovation of school facilities has traditionally been the responsibility of State and local governments, financed primarily by local taxpayers.'' And in that respect I agree with the President. I remind my colleagues that the approach in the Moseley-Braun amendment is not risk free. The costs are substantial. The Joint Tax Committee estimates that the revenue loss to the Federal Government for a program like this would be about $3.26 billion over 5 years and $9 billion over 10 years. The Coverdell bill offers better government. I oppose the Moseley- Braun amendment, and I urge my colleagues to join me. I yield back the floor.

Mr. ROTH. Will the distinguished Senator from Illinois yield on my time for 60 seconds?

Mr. ROTH. First of all, I think it is important to point out that we have not been graced with a copy of the amendment so that we are not in a position to state specifically what it says. But my comments are based on the administration's proposal, which specifically spells out these requirements and would result in a major buildup of a Federal bureaucracy. I would just like to point out that this local approach is, indeed, contrary to what the President himself said in 1996. I point to this chart here which says: The construction and renovation of school facilities has traditionally been the responsibility of State and local governments, financed primarily by local taxpayers. It goes on to say: We are opposed to the creation of a new Federal grant program for school construction. With that I 100 percent agree, and it is because of that kind of thinking I think it is important that this amendment be defeated. Amendment No. 2292 (Purpose: To amend the Internal Revenue Code of 1986 to expand the incentives for the construction and renovation of public schools, and for other purposes)

Mr. ROTH. Mr. President, I yield myself 3 minutes. Mr. President, the statement was made by the distinguished Senator from Illinois that her legislation would not require the creation of the type of bureaucracy of which I spoke in my opening remarks. I have since then, for the first time, received a copy of the amendment. But I have to say that exactly as I spelled out in my statement, this legislation requires very detailed action on the part of the Department of Education and the Treasury in allocating and granting the funds provided for under this agreement. Let me just give you one or two illustrations of what I speak. On page 17, in paragraph 5, it says: Approved state application.--For purposes of paragraph (1), the term ``approved State application'' means an application which is approved by the Secretary of Education and which includes-- (A) the result of a recent publicly-available survey (undertaken by the State with the involvement of local education officials, members of the public, and experts in school construction and management) of such State's needs for public school facilities, including descriptions of---- I will not read on. But I want to reemphasize that this legislation is putting control of school construction in the hands of Washington, of the Federal bureaucracy. And that is exactly contrary to what the President himself said in the justification of an appropriations estimate. I think it is important too, because I agree with what he says here: The construction and renovation of school facilities has traditionally been the responsibility of state and local governments, financed primarily by local taxpayers; we are opposed to the creation of a new federal grant program for school construction. That is exactly what I am saying today. We are opposed to the creation of a new Federal program with a bureaucracy. We think the control of our schools, including the construction of new facilities, should be in the hands of the State and local government. I yield the remainder of my time to the distinguished Senator from Georgia.

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

Mr. ROTH

Mr. ROTH. I thank the Chair. Mr. President, I am pleased that we have entered into a unanimous consent agreement with respect to H.R. 2646, the Parent and Student Savings Account Plus Act. It is good to see us moving at last toward passage of this significant bill. The importance of giving American families the resources and means they need to educate their children must be above politics. As I have said before, this bill empowers families--not the federal bureaucracy. It gives resources to the children, not to a monolithic establishment that has grown overbearing and antiquated on a diet of government subsidies. This bill is a much needed change in the way Washington looks at the education of children. It returns parental involvement to where it should be--at the very foundation of their children's education. It lets them use their money to educate their children, allowing them to put their own money into their own Parent and Student Savings Accounts.'' This bill acknowledges that the best thing taxpayers can do with their hard-earned money is to earmark it for the education of their children. It allows them to increase their contributions from $500 per year to $2,000 per year. It allows for withdrawals to be used for elementary and secondary education expenses. And it covers public and private schools. The bill also makes state-sponsored prepaid tuition programs tax- free, not tax-deferred, meaning that students will be able to withdraw on a tax-free basis the savings that accumulate in their pre-paid tuition accounts. Parents will have the incentive to put money away today and their children will have the full benefit of that money tax free tomorrow. Toward promoting these important objectives, the federal government must lead, follow, or get out of the way. Our states and communities-- our families--are embracing innovative educational programs. They realize the old way isn't working. Already, forty-four states have pre- paid tuition plans in effect, and the other six have legislation to create a state plan, or they have implemented a feasibility study. Many cities and states are offering families the power of choice when it comes to selecting what school their children will attend. Others are embracing programs that make private schools more accessible. These measures are having a positive impact, but there is much more to be done, and the federal government must demonstrate its leadership. Let's be bold, Mr. President. The National Center for Education Statistics states that in our children's pre-school years, parents are active in preparing them for school. Almost three-quarters of all parents read to their children regularly. A full 60 percent are active in teaching them to recognize letters and numbers. Interestingly enough, this active parental involvement begins to fall off once the child has entered school. Perhaps this is because government has put itself in the position over the years where it has come to assume parental responsibility, and even frustrated parental participation. ``Give us your money,'' government has said. ``We'll educate your children. We'll make decisions concerning how your precious resources are spent, concerning what will be emphasized--how it will be taught, and by whom.'' This has led to a condition where--according to one of the most extensive studies ever conducted on the forces that affect youth and their performance in school--nearly one in three parents in America is seriously disengaged from his or her adolescent's education. How can it be that while three-quarters of all parents are active in preparing their pre-school children for their educations, only one-third remain active when their child enters adolescence? The answer is simple: parents have become disenfranchised. They have been robbed of the resources they need to make the kinds of decisions that will keep them active in the educational attainments of their children. According to Lawrence Steinberg, the educator who conducted the extensive study of more than 20,000 teenagers and their families in nine very different American communities, ``The failure of our educational policies is due to our obsession with reforming schools and classrooms, and our general disregard of the contributing forces that, while outside the boundaries of the school, are probably more influential.'' These influential forces, Mr. President, include the family. They include the educational resources families are given to provide their children with an environment for learning. They include the flexibility parents have to decide where their children will attend school and how it will be paid for. Our policies must offer Dad and Mom the resources they need to actively re-engage in Junior's education. The Coverdell bill does this. It is a very important step in the right direction, and I urge my colleagues to support it. It's time for innovation. It's time to empower parents. It's time to prepare for the future. This is what the Coverdell bill is all about. I will take a few minutes to walk through the various provisions of the bill. But before I get into the specifics, let me remind my colleagues that with the exception of several school construction bond provisions--which were newly added this year--all of the concepts in this bill should be very familiar. Mr. President, these concepts should be familiar because we have already endorsed them. The base provisions in the bill--which include the increase in the maximum allowable contribution to an education IRA, the use of the IRA for elementary and secondary school expenses for public and private schools, the tax-free treatment of state sponsored prepaid tuition plans, and the extension of tax-free treatment for employer provided educational assistance--all received overwhelming bipartisan support in the Senate as part of the Taxpayer Relief Act of 1997. Despite this Senate support, these provisions were dropped from the bill during conference negotiations. Because of opposition from the Administration, these particular elements failed to be included in the final version of the Taxpayer Relief Act of 1997. We are here today to show our commitment to these provisions--and to enact what this body has already determined makes good sense for American families. Mr. President, it is important to note that this tax bill is not designed to answer all of the education-related issues that face this country. Those issues are too varied and complicated to be addressed by the federal government. They need to be solved at the state and local level--by schools, teachers, and parents working together. Instead, this bill is designed to build on the innovative concepts that have been introduced in the last few years. Our goal is to alter the tax code so that it provides the necessary incentives to help American families help their children. These are much needed tools. Over the past 15 years, tuition at a four year college has increased by 234%. The average student loan has increased by 367%. In contrast median household income rose only 82% during this period and the consumer price index rose only 74%. Our students--our families--need these resources to help them meet the costs and realize the opportunities of a quality education. The Senate recognized the importance of these provisions less than one year ago, voting in favor of them. I hope that my colleagues continue to recognize just how important they remain. The American people are counting on us. Now let me take a few minutes to describe the various provisions of this bill--to provide an overview and to highlight some reasons why these measures are so important. As I have already mentioned, the bill increases the maximum education IRA contribution from $500 to $2,000. That increase is important on two levels. First, with the well-documented increase in education costs, it is essential that we provide American families with the resources needed to meet those costs. I have long argued that it is essential to change the savings habits of the American people, and there are few things more important than the education of our children. Not only will saving in this way increase our investment capital, it will increase American's education capital as well. Anything that thwarts either of these objectives is short-sighted. By using the tax code to encourage individual responsibility for paying for educational expenses, we all benefit. The expansion of the education IRA will result in greater opportunities for individuals to save for their children's education. Besides being too low to give parents the necessary resources to pay for the costs of education, the current $500 limit fails from another practical perspective. As we all know, any broker or bank that provides an IRA account faces assorted administrative costs for each account. To ensure that they can adequately cover their administrative costs, most brokers or banks impose a minimum account balance. In many cases, the minimum balance has been set well higher than $500. That reality of the marketplace has the effect of limiting the availability of the education IRA to American families. Another reality is that confronted by a $500 limit, many mutual fund companies find that it is not worth their while to spend money on marketing the education IRA. It is a fact of life that regardless of what we say and do in Congress, many families will only know about the benefits of an education IRA through the marketing efforts of their local mutual fund companies and banks. These businesses have been very successful in marketing IRAs with a higher contribution limit. If we want to maximize the involvement of American families in education IRAs, Mr. President, we need to ensure that the accounts make economic sense from the perspective of the companies offering them. Mr. President, the next major change that this bill makes to education IRAs is that it allows withdrawals for education expenses for elementary and secondary schools and for both private and public schools. As we recognized last year, it is a fundamental principle that a parent should have the right and the ability to make decisions about his or her child's education--to decide basic questions such as how the child should be educated and where the child should attend school. Last year, for example, when Congress passed a variety of provisions targeted to higher education, we made no distinction between private and public schools. We did not say, for instance, that an education IRA or a Hope scholarship would only be available if a student attended public school. We did not say that a student who attended the University of Maryland would receive a tax benefit and a student who attended George Washington University would receive nothing. This bill recognizes that just as with secondary schools, we should not establish a priority system where some elementary and secondary schools are favored over others. We should not forget that it is the taxpayer who funds the education IRA--that it is the parent who puts his or her hard-earned money into the education IRA. Mr. President, it seems a matter of common sense, therefore, that the parent should be able to choose how to spend that money. Moreover, parents with students in elementary and secondary schools need our help to cope with the costs. It is simply not true that only rich kids attend private elementary or secondary schools. For instance, according to the National Catholic Education Association, almost 70% of the families with children in Catholic schools have incomes below $35,000 and almost 90% of those families have incomes below $50,000. Another provision in this bill makes state-sponsored prepaid tuition plans tax-free, not simply tax-deferred. This is a significant distinction, because it allows students to withdraw the savings that accumulate in their pre-paid tuition accounts without paying any tax at all. It means that parents have the incentive to put money away today and their children have the full benefit of that money, without any tax, tomorrow. As I have already mentioned, forty-four states have pre-paid tuition plans in effect, and the other six are in the process of implementing such plans. This means that every member of the Senate has parents and students back home who either benefit from this plan right now, or will benefit from this plan soon. Mr. President, the Coverdell bill also extends tax-free treatment of employer provided educational assistance for graduates and undergraduates through the year 2002. This particular program is a time-tested and widely used benefit for working students. Over one million workers across America receive tax- free employer provided education. This allows them to stay on the cutting edge of their careers. It benefits not only them, individually, but their employers and the economy as a whole. With the constant innovations and advancing technology of our society, it is vitally important that we continue this program. The various provisions that I have just described have already been embraced by members of this body, and they were approved last year. They made sense then. They certainly continue to make sense today. Mr. President, the Coverdell bill does even more than address the costs of attending school. In response to concerns from Members on both sides of the aisle, the Finance Committee agreed on some measures to provide targeted relief in the area of school construction. The first provision is directed at high growth school districts. It expands the tax-exempt bond rules for public/private partnerships set up for the construction, renovation, or restoration of public school facilities in these districts. In general, it allows states to issue tax-exempt bonds equal to $10 per state resident. Each state would be guaranteed a minimum allocation of at least $5 million of these tax-exempt bonds. In total, up to $600 million per year in new tax exempt bonds would be issued for these innovative school construction projects. This provision is important because it retains state and local flexibility. It does not impose a new bureaucracy on the states and it does not force the federal government to micro-manage school construction. The provision also is important because it promotes the use of public/private partnerships. Many high-growth school districts may be too poor or too overwhelmed to take on a school construction project themselves. With these bonds, those districts can partner with a private entity--and still enjoy the benefits of tax-exempt financing. Mr. President, it is worth noting that there already is a significant federal subsidy for school construction. Under current law, states and localities can issue debt that is exempt from federal taxation. This benefit allows them to finance school construction by issuing long term bonds at a lower cost than they otherwise could. Moreover, the evidence shows that states and localities are taking advantage of this benefit. In the first six months of 1996, voters approved $13.3 billion in school bonds, an increase of more than $4 billion over the first six months of 1995. The bottom line is that many states and localities are doing their homework, passing bonds, building and renovating schools, and enjoying favorable treatment under the existing tax code. They are doing all this without significant federal involvement. I do not have to remind my colleagues that school construction has always been the province of state and local governments. President Clinton himself stated in 1994 that ``the construction and renovation of school facilities has traditionally been the responsibility of state and local governments financed primarily by local taxpayers.'' In that respect, I agree with the President. Mr. President, there is a second bond provision in this bill. That provision is designed to simplify the issuance of bonds for school construction. Under current law, arbitrage profits earned on investments unrelated to the purpose of the borrowing must be rebated to the Federal government. However, there is an exception--generally referred to as the small issuer exception--which allows governments to issue up to $5 million of bonds without being subject to the arbitrage rebate requirement. We recently increased this limit to $10 million for governments that issue at least $5 million of public school bonds during the year. The provision in the Coverdell bill increases the small issuer exception to $15 million, provided that at least $10 million of the bonds are issued to finance public schools. This measure will assist localities in meeting school construction needs by simplifying their use of tax-exempt financing. At the same time, it will not create incentives to issue such debt earlier or in larger amounts than is necessary. It is a type of targeted provision that makes sense. It is clear, Mr. President, that the Coverdell bill contains many important provisions for the American family. As I have said already, many of these measures have already been passed by the Senate. Anyone--students or parents--who is on the front line dealing with the costs of a quality education, must have been disappointed last year when we failed to give them all the tools that they needed. American families understand just how important these measures are. They have now been waiting for a year. Let's not disappoint them any further. Let's not keep them waiting any longer. Let's move forward. Let's pass the Coverdell bill now. Mr. President, I yield the floor.

Mr. ROTH. Mr. President, I suggest the absence of a quorum.

Mr. ROTH. I say to the distinguished Senator from North Dakota, we would have no objection to your taking 15 minutes. But we do hope it will be the understanding tomorrow that we will proceed from amendment to amendment. But with that admonition, we agree to your request. Mr. COVERDELL addressed the Chair.

Mr. ROTH. Mr. President, I object.

Mr. ROTH. Mr. President, I rise in opposition to this amendment. This amendment would not permit educational IRAs to be used to pay the expenses of kindergarten up through 12th grade. This proposal to limit the use of educational IRAs would dramatically--I want to emphasize ``dramatically''--reduce the benefits of an educational IRA for American families. I believe that it is a fundamental principle that a parent should have the right and the ability to make decisions about his or her child's education --to decide basic questions, such as how the child should be educated and where the child should attend school. The rich should not be the only ones that too often have this choice--although there are many, many children from middle-class families who attend private schools at great personal sacrifice of their families. What we seek here is to give a choice to all families as to where their child will attend school. We should not try to control that parental right by providing tax benefits only to those parents who make what some Members of this body consider to be the correct choice. We should all remember that last year, when the Senate passed a variety of provisions targeted towards helping American families cope with the costs of a quality education, we made no distinction between public and private schools or between higher education and secondary or elementary schools. For example, we did not say that an educational IRA would only be available if a student attended public school or college. We did not say that a student who attended the University of Maryland would receive a tax benefit, but a student who attended George Washington University would receive nothing. We did not say that a student who attended college would receive a tax benefit, but a student who incurred costs in connection with secondary or elementary school would receive nothing. The bottom line was that we treated all schools the same. And the reason for that treatment is that we did not consider it our business to set up a system where some schools were favored over others. Mr. President, we should also not forget that it is the taxpayer who funds the education IRA. It is the parents--the parent who put his or her hard-earned money into the education IRA. And it seems a matter of common sense, therefore, that the parents should be able to choose how to spend that money. To fully receive the benefits of an education IRA, parents should try to establish accounts for their schoolchildren as early as possible. If the parent can afford to make contributions early in a child's life, the benefits of the education IRA will increase dramatically through the magic of tax-free compounding within the IRA. At this early stage in a child's life, parents may not know whether they will send their children to a private or public school. Parents also may not know whether they will need the benefits of an education IRA for elementary and secondary school or for higher education. There are many, many factors that go into these important decisions. The needs of the child may change. The family may move into a different school district. The quality of the neighborhood schools may rise or fall. It is simply unfair to make the parent look into a crystal ball and predict what type of school their child may attend or how much that school may cost. This places too great of an unnecessary burden on the parent. The side effect of that burden of making parents look into the future is that parents may be reluctant to fully utilize the education IRA. The parents may not contribute the maximum amount of money that they can to these accounts. That, Mr. President, would be most unfortunate because it would defeat the whole purpose of the education IRA concept. Moreover, Mr. President, the existing provisions of the bill do not favor the wealthy, as some here have argued. First of all, there is an adjusted gross income phaseout. In other words, only parents with incomes below a certain threshold can take advantage of the tax savings in the education IRA. Second, it simply is not true that only rich kids attend private schools. As I said earlier, many, many children from middle-class families attend private schools at great personal sacrifice on the part of their parents. For instance, according to the National Catholic Education Association, of the families with children in Catholic schools, almost 70 percent of those families have incomes below $35,000; almost 90 percent of those families have incomes below $50,000. If we adopt this amendment, all of those families will be shut out from receiving the tax benefits in the education IRA, as would all of the roughly 38 million families who have children in either public or private elementary and secondary schools. Mr. President, limiting the education IRA is not good policy, and it does not make sense for American families. Accordingly, I oppose this amendment, and I urge my colleagues to do the same. I yield the floor. Mr. COVERDELL addressed the Chair.

Mr. ROTH

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

Mr. ROTH

Mr. ROTH. Mr. President, I rise today to introduce five bills to suspend temporarily the imposition of duties on certain products. I am pleased to introduce these bills to suspend temporarily the imposition of duties on imports of pigments. These high quality coloring materials are imported for sale in the United States by Ciba Specialty Chemicals Corporation (Pigments Division), a company located in Newport, Delaware. By temporarily suspending the imposition of duties, these bills will reduce significantly the cost of coloring materials that are used in a wide variety of finished products, including automotive parts, vinyl flooring, carpet fibers and utensils. I ask unanimous consent that these bills be printed in the Record.

Mr. ROTH

Mr. ROTH. Mr. President, I rise today to introduce five bills to suspend temporarily the imposition of duties on certain products. I am pleased to introduce these bills to suspend temporarily the imposition of duties on imports of pigments. These high quality coloring materials are imported for sale in the United States by Ciba Specialty Chemicals Corporation (Pigments Division), a company located in Newport, Delaware. By temporarily suspending the imposition of duties, these bills will reduce significantly the cost of coloring materials that are used in a wide variety of finished products, including automotive parts, vinyl flooring, carpet fibers and utensils. I ask unanimous consent that these bills be printed in the Record.

Mr. ROTH

Mr. ROTH. Mr. President, on behalf of the Finance Committee, I am joining with Senator Moynihan and others today to bring H.R. 3130, the Child Support Performance and Incentive Act of 1998, before the Senate. This important bill passed the House of Representatives earlier this month by a vote of 414 to 1. When a bill passes the House by that wide of a margin, it is either noncontroversial, of limited national significance, or an extremely important piece of legislation with broad and deep support. H.R. 3130 clearly falls within this last category. The work on this legislation began shortly after the ``Personal Responsibility and Work Opportunity Reconciliation Act of 1996'' was signed into law. The 1996 welfare reform act required the Secretary of Health and Human Services to recommend to Congress a new, budget- neutral performance-based incentive system for the child support enforcement program. H.R. 3130 incorporates those recommendations which were developed in consultation with 26 representatives of state and local child support enforcement systems. The new incentive program is the centerpiece of this bill. Under current law, the Federal Government returns more than $400 million per year in child support collections to the states as incentive payments. But this incentive structure has been criticized for years as weak and inadequate. All States, regardless of actual performance, receive some incentive payments. But for more than a decade, performance has not been tied to the national goals of the program. H.R. 3130 breaks with the past and creates five categories in which state performance will be evaluated and rewarded. The States will be measured according to their performance in paternity establishment, establishment of court orders, collections of current child support payments, collections on past due payments, and cost effectiveness. The legislation also requires the Secretary of Health and Human Services to make a future recommendation on adding another performance measure on medical support orders. Let me particularly thank Senator Rockefeller for his work in designing a strategy to overcome the inherent barriers to medical support orders. The new incentive structure is an important development not only for the child support enforcement system but also as a model for improving accountability and performance in government. The second important feature of this bill is to provide for an alternative penalty procedure for those states that have failed to meet federal child support data processing requirements. Less than half of the States have been certified as in compliance. Without this change, states face not only the loss of their entire child support grant, but all of their funds in the Temporary Assistance for Needy Families program as well. Such a result would obviously be crippling to a state and would ultimately hurt the very families these programs are intended to help. Under the new alternative penalty procedures, those states which will not come into compliance this year will face a penalty of four percent of their child support funds. This penalty would double each year in the following two years and would reach 30 percent in the fourth year a state failed to come into compliance. These penalties are tough but fair. Under the Finance amendment, states will not face a penalty in the year in which they come into compliance. And states which come into compliance with the first two years after penalties have been imposed can have the penalty from the prior year reduced. H.R. 3130 also provides additional flexibility to the states in how they design their automated systems. In looking back over the history of automation, we find there were a number of mistakes made at both the federal and state levels which contributed to the delay in getting these systems operational. The child support enforcement system is a prime example of what can happen when regulations fail to keep pace with real world practices. H.R. 3130 recognizes the advances in technologies and allows states to take advantage of these improvements. It properly refocuses federal policy on function and results rather than on rigid rules. All of these changes will work together to get the states in compliance as quickly as possible. This will mean the child support enforcement system will work better for the families who depend on child support. H.R. 3130 also makes a correction in how penalties are applied under the new ``Adoption and Safe Families Act of 1997'' which became law last November. It is vitally important that the states be held accountable for assisting the children in foster care. A child should not be denied the opportunity to be adopted into a loving and caring family simply because the prospective parents live in the next county. When the Department of Health and Human Services issues regulations on how the new penalties are enforced, it should, of course, provide the states with the opportunity to present evidence of how it complies with the new law. The review of this new requirement must be a fair and complete assessment of whether the law is being met. Mr. President, this is indeed an important, bipartisan bill which will prove itself to pay dividends for America's families. I urge its adoption. I ask unanimous consent a summary be printed in the Record.

Mr. ROTH. Yes, that is correct. In addition, the adoption law establishes a new requirement that States must initiate termination of parental rights proceedings in specific cases that are outlined in the law. However, the law only requires States to initiate such proceedings and does not mandate the outcome. Moreover, the law provides that States are not required to initiate termination of parental rights in certain cases, including when there is a compelling reason to conclude that such proceedings would not be in the child's best interest. Thus, the State retains the discretion to make case-by-case determinations regarding whether to seek termination of parental rights.

Mr. ROTH

Mr. ROTH. Mr. President, this amendment deals with a vital national issue--Social Security reform. This amendment is cosponsored by Senators Breaux, Gregg, Robb, Hatch, Nickles, Gramm, Gordon, Smith, and Santorum. Let me say first that as the chairman of the Finance Committee I am acutely aware of Social Security's future financial problems. I am sure these problems are familiar to most members, but nonetheless they bear repeating. In just 14 years, in 2012, revenues to the Social Security trust funds will no longer cover benefits. Social Security will then cash in Treasury bonds that are now accumulating in the trust funds. This will place major pressure on the Federal budget and crowd out other important spending. By 2029 the bonds will be gone. Social Security will then be able to cover only 75 percent of benefits directly from revenues. The long-term debt of the Social Security system--the difference between revenues and benefit through 2075--is estimated to be an astounding $121 trillion. The purpose of my amendment is simple. Nevertheless, it is important and urgent. The amendment instructs the Finance Committee to dedicate the budget surplus to establishing Social Security personal retirement accounts. Despite its simplicity, I know that many of my colleagues will have at least two questions about this amendment. First: ``Why establish personal retirement accounts this year, rather than wait until next year?'' And second: ``Why not begin with comprehensive Social Security reform, rather than start with personal retirement accounts?'' Mr. President, the easy course would be to wait until next year to begin Social Security reform. But the fact is, Social Security reform will be a big job. I am very concerned that trying to do it all in one year--in 1999--will simply not be possible. Americans have learned that big, comprehensive proposals, with many parts, often run into problems in Congress and can easily take several years to enact. Particularly proposals that deal with an important, sensitive program like Social Security. The place to start with Social Security reform is to establish a program of personal retirement accounts--funded by the budget surpluses. Dedicating the surplus to personal retirement accounts allows us to get started on reform without running into controversies over changes to the traditional program. Personal retirement accounts themselves would be a big, new feature of Social Security. We will need to explain these accounts to the American people, and writing a bill will require thoughtful action by the Finance Committee. Mr. President, let me note for the record that there is a growing bipartisan consensus that personal retirement accounts must be an essential feature of Social Security reform. And I want to emphasize the word ``bipartisan.'' In the Senate, Senator Bob Kerrey, another member of the Finance Committee, was an early and vocal advocate of personal retirement accounts. In the last Congress, he and Senator Alan Simpson, now retired, introduced a ground-breaking Social Security reform bill with personal retirement accounts that grew out of their experience on the 1994 Bipartisan Commission on Entitlement and Tax Reform. Other Democrats support this concept. For example, Senator Robb, another cosponsor of my amendment, proposed a sense-of-the-Senate to last year's budget resolution that would have funded Social Security retirement accounts. And just two weeks ago, Senator Moynihan, the ranking Democrat on the Finance Committee and a recognized expert on Social Security, introduced a comprehensive Social Security reform package that included personal retirement accounts. On the Republican side of the aisle, there is strong support as well. Senators Judd Gregg, Don Nickles, Phil Gramm, Rick Santorum, and Rod Grams, among others, have been enthusiastic advocates of Social Security personal retirement accounts. Let me explain why Social Security personal retirement accounts find so much support--not only in Congress, but among the American people. While proposals differ, the basic objective of this program is to provide each working American with funds to be deposited into personal retirement accounts. With even conservative investment, such accounts have the potential to grow to provide a secure and generous retirement nest egg. Indeed, for the first time Americans could look forward to having real personal wealth in old age, not just enough to keep body and soul together. A recent report by the Congressional Research Service provides many illustrations of what Social Security personal accounts may offer. For example, for an individual who is 28 years old today and earns an average wage--about $27,000, just 1 percent of an amount equal to his or her wages invested over the next 37 years in the S&P 500 would grow to $132,000, which would be worth about 20 percent of his or her Social Security benefits. By the way, CRS assumed a 10-percent rate of return for the S&P 500. In fact, over the past 10 years, the compounded annual return on the S&P 500 has been 18 percent. Mr. President, using the budget surpluses to create retirement accounts represents an opportunity to get these accounts up and running. Once in place, we can then begin looking at Social Security benefits for the long run. It will help insure that Social Security benefits continue to provide a secure foundation of retirement income. Establishing these accounts this year--as a new program in addition to the current Social Security program--would allow us to demonstrate their value in providing retirement benefits for working Americans in the years to come. Creating these accounts would also give the majority of Americans who do not own any investment assets a new stake in America's economic growth, because that growth will be returned directly to their benefit. More Americans will be the owners of capital--not just workers. Creating these accounts will help Americans to better be prepared for retirement, generally. According to the Congressional Research Service, 60 percent of Americans are not actively participating in a retirement program other than Social Security; this, in spite of the fact that Social Security was never intended to be the sole source of retirement income. Mr. President, could there be a more important use of the budget surplus? Some may believe that the budget surplus should be used to reduce the debt, not dedicated to personal retirement accounts. That is exactly what we will do by using the surplus to create these accounts. Social Security, a $121 billion unfunded liability over the next 75 years, is a huge debt and we need to recognize it as such. Retirement accounts and other solvency proposals would be a critical first step in reform. At the same time, it would tackle that debt and protect benefits. Most observers expect a surplus upwards of $60 billion this fiscal year, enough to get started on retirement accounts and to begin reducing the Federal debt. Some may be concerned that the President and others have called for a year-long national dialog on Social Security reform. They may be erroneously believing that doing reform this year might undermine the national dialog. On the contrary, I can think of no better way to focus it than with specific proposals and action by a U.S. Senate committee. Mr. President, Congress has talked for a long time about the need to do something to shore up Social Security. The time has come for action. It is indeed a blessing that we have a surplus to work with. Now let's put that surplus to work. The Finance Committee must get started on Social Security reform this year. The place to start is by dedicating the budget surplus to fund personal retirement accounts. This amendment will get the ball rolling. I urge Members to support it. Mr. DOMENICI addressed the Chair.

Mr. ROTH. Mr. President, I ask unanimous consent that the pending amendment be set aside, and I ask for the immediate consideration of amendment No. 2209.

Mr. ROTH. Mr. President, this budget resolution contains some provisions that I applaud, but it falls short in several areas: first, the proposed tax cuts are too small to provide the relief that taxpayers need and deserve; second, it does not adequately restrain the growth and reach of the Federal Government. Third, it is not what the hardworking men and women of America desire nor deserve. They deserve better. The current economic expansion is now 84 months old, the third longest on record. Overall growth rate has been relatively steady and moderate. In the last three months alone, more than one million new jobs have been created, while the unemployment rate has been reduced to a 24-year low. In addition, inflation as measured by the CPI is only 1.6 percent. In the midst of this prosperity our citizens are burdened by levels of taxation that are increasingly oppressive--all to satisfy the appetite of the Federal behemoth. This condition runs contrary to counsel handed down from President Jefferson--counsel we would do well to heed as we move forward with the budget debate. In his First Annual message to the Congress, President Jefferson wrote that the object of congressional efforts should be ``to preserve the general and State governments in their constitutional form and equilibrium; to maintain peace abroad, and order and obedience to the laws at home; to establish principles and practices of administration favorable to the security of liberty and prosperity, and to reduce expenses to what is necessary for the useful purposes of government.'' These are among the core principles which have thus far separated our nation from the rest of the world. It is up to this Congress to apply President Jefferson's principle to ``reduce expenses to what is necessary for the useful purposes of government.'' All else should remain in the hands of our citizens. Today, revenue levels are at all time highs, approaching 20 percent of GDP in both this fiscal year and the next. Not only are these levels high in historical terms, they are unprecedented for a peace-time economy. In fact, the only time in this century that revenues were higher was during World War II. Unfortunately, this does not appear to be an anomaly; the Congressional Budget Office projects that unusually high levels of revenue will continue to be extracted from taxpayers for the foreseeable future. It is worth noting, Mr. President, that these very same revenues are largely responsible for the budget surplus that has generated so much excitement here in Washington. In fact, the current surplus is mainly attributable to additional unanticipated revenues of about $72 billion in 1997, rather than the effect of spending cuts. It is also worth noting that these revenues have been fueled mainly by our strong economic growth in the last year. Yet, despite the record high level of revenues that the Federal Government now collects to feed its appetite for spending, we are told that we need additional Federal programs! Over the past 2 months, President Clinton has engaged in a well orchestrated campaign to secure approval for spending billions of dollars more on new and expanded government programs. He has set a trap for the American people by promising to do more for them in exchange for higher taxes on their capital and labor. We have balanced the Federal budget. But that is only one of the steps to be taken to meet Jefferson's objective. We must go on to examine whether the current size and breadth, let alone further expansion, of the Federal Government for these purposes justifies the taxation on the toil of our fellow citizens. Let's never forget that the revenue collected by Washington does not belong to the Federal Government; it belongs to the hard-working men and women of this country. Mr. President, the budget resolution should allow for immediate and significant tax relief for American taxpayers. However, the $30 billion of tax cuts proposed in the current resolution are not sufficient to provide this relief. I would like to see this budget resolution contain total tax cuts of at least $65 billion over 5 years. These cuts could take a number of forms, including marriage penalty reforms, family tax relief, and savings and investment incentives. For example, half of American families face the marriage penalty. The Congress proposed to phase out the marriage penalty for non-itemizers as part of the 1995 Balanced Budget Act, but the proposal was vetoed by President Clinton. In addition to marriage penalty relief, consideration could be given to tax relief for families such as a child care credits for both stay-at-home parents and working parents. Ultimately, whatever the final form that tax cuts take, the crucial consideration is that they be substantive and immediate. However, we are limited in the ways that we can offset these tax cuts. While the President's Fiscal Year 1999 budget contains a number of revenue raisers, many are rehashed, or controversial proposals that have failed before due to opposition on both sides of the aisle. We also cannot look to the spending programs within the jurisdiction of the Finance Committee for savings. We are all firmly committed to protecting the reforms we have made to the Medicare, Medicaid and welfare programs, and should make no further changes at this time. In my opinion, the best option is for the cuts to be offset through the use of a portion of the tobacco settlement revenues. While the lack of meaningful tax relief is my main objection to this budget resolution, I am also disappointed to see that there is no provision to make better use of the budget surplus. We should not simply spend this surplus, or set it aside; we can do better for our families and the future. I strongly believe that the most productive use of thee surpluses is to fund individual Social Security investment accounts for all workers who contribute to the payroll tax. Therefore, Mr. president, I will be offering a sense-of- the-Senate amendment to instruct the Finance Committee to report a Social Security bill this year. The bill would dedicate the budget surplus to fund Social Security personal retirement accounts. Equally important, my bill will place the Senate on record for putting these surpluses to work for the American taxpayers, and not simply setting them aside to be spend on other less important priorities than social security. Finally, Mr. President, I must express my concern over some of the methods for shifting funds around under the budget resolution. Budget rules should not be invented to give authority to one committee to achieve budget savings under the jurisdiction of another committee. More specifically, this resolution gives control over the Medicaid program and welfare programs to the Appropriations Committee. Moreover, savings are to be achieved through administrative reforms which may prove to be unfair and unworkable with our partners, the states. Reforming Medicaid and finding program savings in the child support enforcement system or finding other alternatives should be a task for the committee of jurisdiction--namely the Finance Committee. Mr. President, the American people expect more from us. And it is incumbent upon us to see that they get it. Mr. President, I yield the floor. I make a point of order a quorum is not present.