William Roth

Mr. ROTH

Mr. ROTH. Mr. President, with respect to the first point, long-term care insurance is treated the same as medical insurance for tax purposes under the leadership amendment. Since long-term care insurance is treated as medical insurance it is intended that it will be subject to the nondiscrimination rules applicable to medical insurance provided to employees by an employer. On the Senator's second point, it is not the intent of the leadership amendment to preclude States from enacting stronger long-term care consumer protections. A clarification of this issue can be addressed in the conference report to the bill if necessary. jeffords-simon and domenici-wellstone amendments

Mr. ROTH

Mr. ROTH. Mr. President, medical savings accounts are among the most important steps that must be taken to address this country's health care needs, particularly the need for portability. MSA's are of such importance in our effort to address our health concerns that on September 8, 1992, several of my distinguished colleagues signed a letter calling for the introduction of MSA's as part of their bill. Let me quote a portion of that letter: Unlike many standard third-party health care coverage plans, Medical Care Savings Accounts would give consumers an incentive to monitor spending carefully because to do otherwise would be wasting their ``own'' money. . . Once a Medical Savings Account is established for an employee, it is fully portable. Money in the account can be used to continue insurance while an employee is between jobs or on strike. Recent studies show that at least 50 percent of the uninsured are uninsured for four months or less. . . . Today, even commonly required small dollar deductibles (typically $250 to $500) create a hardship for the financially stressed individual or family seeking regular, preventative care services. With Medical Savings Accounts, however, that same individual or family would have this critical money in their account to pay for the needed services. Mr. President, these are important arguments that were made for MSA's over 3 years ago. They are equally, if not more, important today. That letter was signed by Senators Breaux, Boren, Daschle, Lugar, Coats, and Nunn, a formidable bipartisan coalition of Senators taking a necessary stand on a critical issue. Mr. President, I have a copy of a letter received from the Vice President of the NFIB that makes it clear that they are supporting the MSA. This letter, dated today, April 18, 1996, to the Honorable Don Nickles says, ``Overall, NFIB members need health care reform. It has been a top priority for years. MSA's are among the provisions we have consistently supported. These also include portability, no preexisting condition exclusion, deductibility, and small business purchasing groups. We will continue to fight for all these provisions of importance to small business.'' For these reasons, Mr. President, I urge my colleagues on both sides of the aisle to vote against the motion to strike. I yield the floor.

Mr. ROTH. With 1\1/2\ minutes of leader time, we have a total of 4 minutes.

Mr. ROTH. I yield 4 minutes to the Senator from Iowa.

Mr. ROTH

Mr. ROTH. Mr. President, it has been 37 months since President Clinton outlined his welfare reform goals. On February 2, 1993, he told the Nation's Governors he would announce the formation of a welfare reform group within 10 days to work with the Governors to develop a welfare reform plan. But welfare reform was not enacted that year nor the following year. Fourteen months ago, President Clinton declared at a joint session of Congress that, ``Nothing has done more to undermine our sense of common responsibility than our failed welfare system. It rewards welfare over work. It undermines family values.'' In response, the new Congress passed welfare reform twice in 1995. H.R. 4, the Personal Responsibility and Work Opportunity Act of 1995, received bipartisan support in both the House and Senate as it was being drafted. Yet, 10 weeks ago, President Clinton vetoed welfare reform for a second time. With a stroke of his pen, President Clinton wiped out the welfare reform American families need and expect. By vetoing welfare reform, President Clinton has accepted the status quo in which millions of children are trapped in a vicious cycle of dependency. Two weeks after he vetoed H.R. 4 President Clinton once again pledged his support for welfare reform in his 1996 State of the Union Address. The President also declared that, ``the era of big government is over.'' But his actions contradict his words. On February 6, the Nation's Governors issued their own bold challenge to reform the welfare state. The Governors' unanimously adopted a bipartisan--I emphasize ``a bipartisan''--blueprint for returning the power and authority over the welfare system, including Medicaid, to the States. Since then, the Finance Committee has held three hearings on the welfare and Medicaid proposals forwarded by the National Governors' Association. The Governors specifically built upon the welfare reform conference report rejected by the President. On February 28, Secretary Shalala testified for the administration on the Governors' proposals. Once again, we found that the administration has an incredible capacity to blow hot and cold air at the same time. While lauding the Governors for their effort, Secretary Shalala opposed every major provision of the bipartisan proposals. The Nation's Governors assembled again this week, this time in Palisades, NY, for a National Education Summit. The purpose of this meeting was for the States to share their ideas and strategies for introducing new technologies, standards, and assessments to improve the education of our children. The Governors invited the business leaders who will help develop the new learning systems which will combine education and technology. The Governors also invited President Clinton to address the summit and, who no doubt, pledged his support and commitment to our children's future. But among all of the dignitaries, there was an uninvited and unwelcome guest at the banquet. Medicaid, the uninvited guest, will consume much of the necessary resources intended for education and will leave only scraps for the education of our children. The insatiable appetite of Medicaid spending is limiting the ability of the Governors to fully fund education as they wish as Medicaid's share of State spending has nearly doubled in just 7 years. Its share has grown from 10 percent of State spending in 1987 to 19.4 in 1994. During this same time, the share of State spending for elementary and secondary education dropped from 22.8 to 20.3 percent. Higher education's share dropped from 12.3 to 10.5 percent. In 1990, Medicaid spending replaced higher education as the second largest State spending category, exceeded only by elementary and secondary education. If present trends continue, Medicaid will soon pass elementary and secondary education as well. As shares of total State spending, both elementary and secondary education and higher education are at their lowest point in memory. Between fiscal years 1993 and 1994, elementary and secondary education grew by just 2 percent. In comparison, Medicaid grew by more than 12 percent. These alarming trends have consequences in other vital services as well. Transportation's share has dropped from 10.6 percent of State spending to 8.9 percent. The broad category of all other which includes public safety, investment in infrastructure, and many other services has declined 3 percentage points. Another hidden threat of Medicaid is how State government is funded. Medicaid forces States to borrow more to finance the cost of education. States cannot sell bonds to finance Medicaid, so the cost and burden of borrowing is passed on to other budget categories. In 1987, 6.4 percent of bonds issued were to finance higher education. In 1984, 19.2 percent of bonds were used to fund higher education. This debt, of course, is ultimately passed on to our children. Even worse, as Medicaid spending consumes even greater shares of spending, leaving less for education, the cost of education may well rise beyond the ability of many families to spend their children to college to all. The consequences of the failed welfare system are realized in many ways. It spreads its ill effects throughout society. Now we find that unlimited entitlement spending threatens our democratic institutions as well. Mandatory Medicaid spending is draining State and Federal budgets. Governors and State legislatures are no longer in control of their State governments--they are being held hostage by the demands of Federal bureaucrats. Mr. President, if we truly care about the education and future of our children, we must enact authentic welfare reform. Medicaid is the largest welfare program and the threat of its uncontrolled growth is spreading. Without welfare and Medicaid reform, whatever President Clinton promised for education last Wednesday in New York, is certain to be consumed by Medicaid tomorrow. Mr. President, I yield back the floor.

Mr. ROTH

Mr. ROTH. Mr. President, we all know the Social Security trust fund has a long-range solvency problem. Beginning in 2013, payroll taxes will no longer be enough to cover benefits, and by 2031 the trust fund surplus will be depleted. Although this bill is in no way a complete solution to that problem, every little bit helps. Lastly, let me note that title I contains two other provisions important to the health of the Social Security system. First, the bill provides funding for continuing disability reviews. These reviews are supposed to be done periodically to determine if individuals receiving disability benefits under Social Security or SSI continue to be disabled. Historically, this important program integrity activity has not been well funded, and the Social Security Administration has a backlog of over 1 million reviews waiting to be done. Social Security itself admits that billions of dollars have been lost from not doing these reviews, and even more money will be lost in the future. This bill will help fix that urgent problem. Incidentally, the continuing disability review provision is supported by the Administration, and a very similar proposal is continued in the President's 1997 budget. Second, title I of this bill contains a provision to protect the Social Security and Medicare trust funds from underinvestment or disinvestment--which has been endorsed by the Treasury Department. Title I of this bill was reported out of the Finance Committee unanimously and a similar measure passed the House by the overwhelmingly bipartisan vote of 411 to 4. I am grateful to Senators Dole and McCain, both champions of raising the earnings limit, for their tireless efforts on this issue. I am proud to join them in this effort. Raising the earnings limit is also strongly supported by AARP. Mr. President, I ask unanimous consent that a letter from AARP be printed in the Record immediately following my remarks.

Mr. ROTH. Mr. President, today the Senate considers H.R. 3136, a bill to increase the public debt limit to $5.5 trillion. The bill would also increase the earnings limit for all Social Security recipients as well as provide regulatory relief for small businesses. The regulatory relief package mirrors S. 942, which passed the Senate earlier this month by a vote of 100 to 0. As of last night, some details of that package were still being finalized. Senator Bond, chairman of the Small Business Committee, will explain that portion of this bill. I will focus my remarks on the Senior Citizens' Right to Work Act of 1996. However, before I do that, let me spend a few moments on the need for the debt-limit increase. Earlier this year, we passed two bills, H.R. 2924 and H.R. 3021, to provide for temporary relief from the current debt limit. These two bills created new legal borrowing authority not subject to the debt limit for a short period of time. Today we will act on the long-term extension. According to the Congressional Budget Office, this increase should be sufficient through the end of fiscal year 1997. Over the past decade, many have argued against raising the debt limit, however, let me remind my colleagues that last fall we passed a budget that would have achieved balance in 7 years. That legislation would have gone a long way to reduce the amount of debt limit increases which are always so painful to enact. Unfortunately, as we all know, President Clinton decided to veto the Balanced Budget Act of 1995. If we fail to concur in the action of the House, or if President Clinton were to veto this bill, we would find ourselves in a fiscal and financial crisis. The Government could not borrow and bills would only be paid out of current receipts, leading to defaults on interest payments and payments to contractors as well as an inability to make all required benefit payments. These defaults would also lead to higher interest rates. Congress has raised the debt limit 33 times between 1980 and 1995. Many of these increases were short-term temporary extensions. It is important to remember that the increase of $600 billion included in this bill is the third largest increase. The largest increase was in the 1990 budget deal and the second largest was in the 1993 Clinton tax-increase bill. I hope that the Senate expeditiously enacts this critically important piece of legislation to preserve the full faith and credit of the U.S. Government. Now let me turn to title I of this bill. The Senior Citizens' Right to Work Act is a big step toward providing greater economic opportunity and security for America's senior citizens. Under current law, millions of men and women between the ages of 65 and 69 are discouraged from working because they face a loss of their Social Security benefits. If a senior citizen earns more than a certain amount--the so-called earnings limit--he or she loses $1 in Social Security benefits for every $3 earned. The current earnings limit is a very low amount--only $11,520. Mr. President, this earnings limit is unfair to seniors and is a barrier to a prosperous economic future of all Americans. For today's seniors, the earnings limit can add up to a whopping tax bite. According to both the Congressional Research Service and the Joint Committee on Taxation, seniors who have wages above the earnings limit can face marginal tax rates over 90 percent, when one factors in Federal and State taxes. Mr. President, that is not right. But as unfair as the earnings test is today, it will be an even bigger problem in the future, a future that is rapidly approaching. We all know the statistics concerning the aging of America. In the same way, we realize more and more that much of our future economic growth will depend on the ability of older Americans to remain working. Mr. President, why do we even have this earnings limit? Back in 1935, when the Social Security system was designed, it was widely believed that the economy could support only a limited number of workers. Perhaps this belief was understandable 60 years ago--when we were in the middle of the Great Depression. But today, few, if any, economists hold such a belief. In fact, most believe quite the opposite. Mr. President, I also believe this bill will improve public confidence in the Social Security system. Social Security is a contract with the American people. Everyone working today knows the taxes the Federal Government takes from them each payday will be returned by the Social Security program when they retire. For parents working to support a family, this sizable tax can be--and often is--overwhelming. But what too many seniors find out, Mr. President, is that the Government can exact a high price when they reach 65. If they continue to work, seniors are allowed to earn very little before the Government starts taking back benefits. As I noted earlier, for every dollar a senior earns over the earnings limit--currently only $11,530--he or she loses 33 cents in benefits. Mr. President, the bill now before the Senate would raise the earnings limit for seniors aged 65 to 69 to $12,500 this year, and to $30,000 by 2002. This legislation is entirely paid for with real savings, not gimmicks. But we are not just spending money. This bill also provides $1.8 billion of deficit reduction over 7 years. Even better, according to the Social Security Administration, title I of this bill actually improves the long-range health of the Social Security trust fund. Mr. President, I ask unanimous consent that a memorandum from the Office of the Actuary of the Social Security Administration that makes this point be printed in the Record immediately following my remarks.

Mr. ROTH. Mr. President, in closing on the earnings limit, let me quote two distinguished experts from the Urban Institute, Eugene Steuerle and Jon Bakija. These experts have stated, ``The simple fact is that the earnings test is a tattered remnant of a bygone era.'' Mr. President, let us act now, and send the message to America's seniors that we value their experience and skills. Exhibit 1 March 22, 1996. From: Stephen C. Goss, Deputy Chief Actuary. Subject: Estimated, long-range OASDI financial effects of the Senior Citizens' Right to Work Act of 1966--Information. To: Harry C. Ballantyne, Chief Actuary. Enacting the ``Senior Citizens' Right to Work Act of 1996'' (Title II of H.R. 3136) would increase (improve) the long- range OASDI actuarial balance by a total amount estimated at 0.03 percent of taxable payroll. The long-range solvency of the OASDI program would thus be improved by reducing the long-range deficit from 2.17 percent of taxable payroll to 2.14 percent of taxable payroll. These estimates are based on the intermediate (alternative II) assumptions of the 1995 Trustees Report. The balance of this memorandum describes the long-range financial effects of the individual provisions of the title. Sections 204 and 205 of this act would each increase (improve) the long-range OASDI actuarial balance by an estimated 0.01 percent of taxable payroll. Section 204 would require one-half support from a stepparent at time of filing for a stepchild to receive benefits on the stepparent's account, and terminate benefits to stepchildren upon the divorce of the stepparent and the natural parent. Section 205 would prohibit eligibility to DI (and SSI) disability benefits based on drug addiction or alcohol abuse, respectively. Section 202, which would raise the earnings test exempt amount for beneficiaries at or above the normal retirement age to $30,000 by 2002, would result in negligible (estimated at less than 0.005 percent of taxable payroll) changes in the long-range OASDI actuarial balance. Sections 206 (pilot study on information for OASDI beneficiaries), 207 (protection of the trust funds), and 208 (professional staff for the Social Security Advisory Board) would also result in negligible effects on the long-range actuarial balance. Section 203 authorizes the appropriation of specific amounts to be made available for fiscal years 1996 through 2002 for continuing disability reviews. This provision will have the effect of increasing the number of continuing disability reviews through 2002, with the result that total costs of the DI program will be lower for the long-range period and that the solvency of the OASDI program will be improved throughout the long-range period. Additional savings will occur if continuing disability reviews continue at the same level beyond 2002 as is provided for in this provision through the year 2002. The effect of this provision, assuming the appropriation of the specified amounts through 2002, is estimated to be an additional increase (improvement) in the long-range actuarial balance estimated at 0.01 percent of taxable payroll. Stephen C. Goss. Exhibit 2

Mr. ROTH

Mr. ROTH. Mr. President, today the Senate turns to the conference report on the line-item veto legislation. This legislation would provide for enhanced rescissions procedures to allow the President to cancel new items of direct or entitlement spending, appropriations, and limit the tax benefits; in sum, virtually all Government expenditures. Mr. President, while I do support the conference report and believe in the intent of the legislation, I am concerned about the way the legislation affects tax provisions. Let me first outline my views regarding the underlying conference report, and then I will turn to the troublesome language regarding taxes. Let me be clear that I believe that the line-item veto will not solve our deficit problem. In fact, it will be used as a tool to help trim Federal spending. We all know, that we need every possible tool to help reduce Federal spending. This is a very important issue that was contained in the Contract With America. The Republican-led Congress continues to keep its promises to the American people in passing legislation that will help reduce Government spending, the budget deficit, and the debt burden on our children. In the Senate's first joint hearing with the House on the issue in January 1995, before the Governmental Affairs Committee, Dr. Alice Rivlin, Director of the Office of Management and Budget asked that the Congress provide the ``strongest possible line-item veto power to the President'' I agreed with Dr. Rivlin's statement. Congress has acted and will now give the President a very strong version of the line-item veto powers. Both the Senate and House passed the line-item veto overwhelmingly. This week the Senate will pass the conference report. A historic moment. Mr. President, the time has come to put an end to out of control Federal spending that has taken money from the private sector--the very sector that creates jobs and economic opportunity for all Americans. The American people are crying out for a smaller, more efficient Government. They are concerned about the trend that for too long has put the interests of big government before the interests of our job- creating private sector. They are irritated by the double-standard that exists between how our families are required to balance their checkbooks and how Government is allowed to continue spending despite its deficit accounts. I believe that spending restraint for our nation is one of the most important steps we can take to ensure the economic opportunities for prosperity for our children and for our children's children. As a nation--and as individuals--we are morally bound to pass on opportunity and security to the next generation. The Federal behemoth must be reformed to meet the needs of all taxpayers for the 21st century. I am convinced that it is through a smaller, smarter government we will be able to serve Americans into the next century. The President's recent budget proposals for next year offer clear evidence of the lack of political will to make the hard choices when it comes to cutting Government spending. His budget does not take seriously the need for spending restraint. In fact, Bill Clinton proposes spending over $1.5 trillion dollars this year and nearly $1.9 trillion dollars in 2002. In other words, the only path that the President proposes is one that leads to higher Government spending, higher taxes, and ever-increasing burdens for our children. Deficit spending cannot continue. We can no longer allow waste, inefficiency, and overbearing Government to consume the potential of America's future. I am committed to spending restraint as we move to balance the budget. As I said before, the line-item veto legislation will not solve our deficit problems, but it will be a helpful tool to cut spending. While the authority conferred upon the President in this legislation is commonly referred to as a line-item veto, the authority is actually an authority to cancel--with specified limitations--appropriations, entitlements, and tax cuts. This cancellation authority bears closer resemblance to impoundment authority than to a traditional veto. What this legislation before us does is to allow a President to sign an appropriation, entitlement, or tax bill and then exercise a separate authority to cancel an item in those laws, such cancellation to be effective unless Congress passes another law, presumably over the President's veto, to negate the President's exercise of his cancellation authority. My concern with this legislation is that I have never heard of impounding a tax cut. I have heard of impounding spending, but not a tax cut. As you know, 43 State Governors have line-item veto authority, but not a single Governor has any authority to cancel a tax cut. It is my studied judgment that the Federal Government spends too much and taxes too much. The well being of our people would be significantly improved if both spending and taxation were diminished. Consequently, I would like this legislation better if it allowed the President to cancel only spending items and not tax-cut items. Fortunately, the President's authority in the tax area is narrow-- evidence of the fact that the conferees understood the anomaly of impounding tax cuts. In contrast to the authority on the spending side whereby the President may cancel, first, ``any dollar amount of discretionary budget authority'' and (2), ``any item of new direct spending,'' the authority on the tax side is limited. The President has the authority to cancel only items which meet the definition of a ``limited tax benefit.'' A ``limited tax benefit'' is a defined term, which covers two specific categories: First, a revenue losing provision which provides a Federal tax deduction, credit, exclusion, or preference to 100 or fewer beneficiaries under the Internal Revenue Code of 1986 in any fiscal year for which the provision is in effect; or Second, any Federal tax provision which provides temporary or permanent transition relief for 10 or fewer beneficiaries in an fiscal year from a change to the Internal Revenue Code. In further contrast to the President's authority to cancel on the spending side, the legislation before us provides an additional mechanism that applies only with respect to limited tax benefits, in order to further circumscribe the President's authority. This mechanism provides that in certain circumstances Congress may reserve unto itself the sole discretion to identify those items in a revenue or reconciliation bill or joint resolution that constitute a limited tax benefit. Such identification by Congress is controlling on the President, notwithstanding the definition of a ``limited tax benefit'' in the pending legislation, and is not subject to review by any court. Historically, the Senate has enacted tax legislation either by unanimous consent, in the case of simple bills, or by agreeing to a conference report, in the case of more significant bills. As a practical matter, the bills adopted by unanimous consent generally deal with one subject and are not an important concern to advocates of a line-item veto authority in the tax area. Conference reports, in contrast, may contain a large number of tax items. It is in such context that a limited tax benefit might be found. Consequently, whenever a revenue or reconciliation bill or joint resolution that amends the Internal Revenue Code of 1986 is in conference, the Joint Committee on Taxation is required to review the legislation and identify any provision that constitutes a limited tax benefit. If the conferees include this list of identified items in the conference report, the President can cancel a tax item only if it appears on the list. If the Joint Committee on Taxation finds that the bill contains no limited tax benefits and Congress includes a statement in the conference report that no such items exist, the President is thereby foreclosed from canceling any tax item. However, if Congress does not include a statement either identifying the specific limited tax benefits or declaring that none is contained in the bill, then the President may cancel a tax item if it falls within the definition of a limited tax benefit and the exercise of the President's authority meets the requirements of section 1021 of the Budget Act, as written by this pending legislation. Similarly, the President has such authority to cancel a limited tax benefit contained in legislation that is not adopted as a conference report. However, as I said, the occasion for an exercise of such authority would be rare, indeed. The pending legislation authorizes conferees, in the above circumstances, to include a statement regarding the provision of limited tax benefits, notwithstanding any precedents or House or Senate rules--such as those rules relating to the proper scope of a conference--that might create a point of order against such inclusion. However, nothing in the pending legislation that authorizes the inclusion of such statements in a conference report limits either House from exercising its constitutional rulemaking authority by requiring, rather than authorizing, the inclusion of such statements. Mr. President, I thank my colleagues for their attention, and I urge that they join me in supporting this needed legislation. I thank the Chair. I yield the floor. Mr. BUMPERS addressed the Chair.

Mr. ROTH

Mr. ROTH. Mr. President, 3 months ago President Clinton vetoed the Balanced Budget Act of 1995. The failure to balance the Federal budget continues to hang like a dark cloud over American families and businesses. The heavy yoke of Federal budget deficits still threaten to choke off economic growth and future prosperity. Moreover, by vetoing this legislation, the President also preserved a welfare system which traps millions of children into a cycle of dependency. A few weeks after the balanced budget veto, President Clinton stopped welfare reform again by vetoing H.R. 4, the Personal Responsibility and Work Opportunity Act of 1995. However, the President also pledged that, ``I am nevertheless determined to keep working with the Congress to enact real, bipartisan welfare reform.'' Mr. President, 1 month ago the men and women who serve as the chief executives of our 50 States presented the President, the Congress, and the American people with bold new proposals to restructure Medicaid and reform the welfare system. Gathering from across the country, the Governors set aside their own differences and found the common ground and bipartisan consensus which have been missing in Washington. The Governors have presented us with a fresh opportunity to bridge the differences which divide the Congress and the President. The Committee on Finance has recently completed a series of hearings on the National Governors' Association proposals. On February 22, six Governors, four Democrats and two Republicans, urged the Congress to quickly pass both welfare and Medicaid reforms. We heard from Governors Carper, Chiles, Engler, Miller of Nevada, Romer, and Thompson--who along with Gov. Mike Leavitt of Utah--created the welfare and Medicaid proposals at a time when few believed such a task would be possible. It would have been easy for these Governors to allow politics and individual interests to divide them. Instead, they put their reputations on the line when it would have been safe to simply leave the task for someone else. This was an effort that was built on a genuine search for common ground and bipartisanship. Indeed, the proposals were adopted unanimously with the support of the most conservative and most liberal Governors and everybody in between. The Finance Committee heard additional testimony from the Secretary of Health and Human Services and two panels of experts on the Governors' proposals. Let me briefly summarize and highlight some of the most important provisions of the NGA proposal. In welfare reform, the Governors agreed to build upon H.R. 4 which President Clinton vetoed, but they have responded favorably to many of the President's requests. The President called for additional child care funds. The Governors ask for $4 billion more in child care funds. The President insists he supports time limits on welfare benefits and the Governors agree. The President called for protecting States in the event of an economic downturn, so the Governors propose another $1 billion for the contingency fund. The President objected to certain Federal mandates and the Governors agree. The President and the Governors also agree on the concept of performance bonuses to reward States for moving families from welfare to work. In ``Restructuring Medicaid,'' the Governors responded to many of the President's concerns outlined in his veto of the Balanced Budget Act. Perhaps most important, States would guarantee Medicaid coverage to nearly every current Medicaid recipient. The current mandatory services would all be guaranteed. The Governors increased funding for persons with disabilities. The Governors agreed to continue current nursing home laws and regulations. These are all significant compromises for the Governors to make. These changes demonstrate that the Governors are firmly committed to this bipartisan effort. In a speech to the National Conference of State Legislatures last July, President Clinton expressed doubts about whether block grants for Medicaid and food stamps would keep pace with changing economic conditions. Once again, the Governors responded to the President's concerns. Governor Romer has described the NGA Medicaid proposal as a ``true combination of a per capita cap and a block grant.'' Under the Governors' proposal, each State would receive a base allocation of funds. In addition, there would be a supplemental insurance umbrella to provide funding for unanticipated growth in the program. In light of all of these changes, one might objectively expect an enthusiastic endorsement of the NGA proposals from the administration. The proposals moved significantly to the President's positions. They were constructed with the help of Democratic Governors, some who served with President Clinton in the National Governors' Association when he was a Governor. To be candid, the administration's response to the Governors' proposal has been profoundly disappointing. Even with all of the modifications offered in the Governors' proposals, Secretary Shalala testified the administration opposes the NGA proposal in its present form. It is apparent that while the administration talks about comprehensive reform, it, in fact, prefers the status quo. At this year's State of the Union Address, President Clinton told the Congress and the American people that, ``the era of big government is over.'' I guess the folks at HHS did not get the message. In describing the current welfare system, the Governors and the administration would seem to be talking about two different worlds. The current welfare system is a masterpiece of mediocrity at best. But time and again, the administration talks about protecting children as if the current system were good for children. In contrast, the Governors have told Congress that the current welfare policies ``punish parents who work too much, they punish mothers and fathers that want to stay together, they punish working families who save money, and they reward teenagers who have babies out of wedlock.'' This is not a legacy to leave for our children. The family is the cell of society and Washington has proven it does not know how to build strong families, only bureaucracies. And now the bureaucracy threatens to stop bipartisan welfare reform. The Governors are looking forward while the Federal bureaucracy clings to the past. While the administration talks about a commitment to the present system, Governor Thompson talks about being trapped in a failed system. The bureaucracy would have us believe that States are poised to callously reduce health care coverage for the poor. In contrast, Governor Thompson believes he would be able to expand health coverage to an additional 30,000 children who are not covered today if reforms are made. He would add hospital coverage for 32,000 indigent adults. While the Governors tell us that immediate action is necessary, the administration wants to appoint a commission to study the current Medicaid formula. While Democratic and Republican Governors alike sharply criticize the current waiver process and the heavy hand of the Health Care Financing Administration, Secretary Shalala defends keeping the power in the hands of the Federal bureaucracy. The very idea that the Federal Government must protect children and the elderly from the Governors and State legislatures is not only wrong. It is insulting. President Clinton had it exactly right when he told the National Conference of State Legislatures last July that ``we couldn't have done all this without a strong commitment to changing the way the government does the people's business here in Washington, because the old federal ways and the old federal bureaucracy were not going to permit the kind of changes we have to make to get to the 21st century.'' How prophetic and how ironic. The old Federal ways and the old Federal bureaucracy are alive and well and are now standing in the way of authentic welfare reform. How predictable but disappointing. Well, Mr. President, the Chief Executive cannot escape the blame for this result. President Clinton went on to say that, ``reinventing government means reinventing the way the Federal Government does business with you as well. We have worked very hard to forge a genuine partnership between the States and the National Government.'' Mr. President, at the current rate of spending, the welfare system is driving both partners into bankruptcy. Who then will be left to serve the needy? Over the next 7 years, the Federal, State, and local governments will spend more than $2.4 trillion on the current welfare and Medicaid programs. That is equal to all State and local government expenditures between 1992 and 1994. In 1994, for $2.4 trillion, you could have purchased: Every farm, including the value of all land and buildings in the United States; All livestock; Every new house sold in the United States; All household equipment sold in the United States, including all furniture, every television, all dishes, every kitchen appliance, and home computer; Every piece of clothing and all shoes sold; All nonresidential buildings, that is, every office building, hospital, and school purchased in 1994. All nonresidential information processing equipment including all office computers and photocopying equipment. These are some of the things you could have bought in 1994 and there would still have been enough money to fund the entire Medicaid Program in 1994. It is simply outrageous for the administration to scare the American people about slowing the rate of growth in these programs. We need to talk about what happens if we do nothing. The plain fact remains that if we do nothing to the current welfare system, more children will be on welfare in the coming years. It is time the administration stopped hiding behind children. the NGA proposals have sparked an important debate not only about the future of these programs, but the future of the relationship between the States and the Federal Government as well. Despite Secretary Shalala's opposition to every fundamental change to the current welfare system, we should move forward on the Governors' welfare and Medicaid proposals. It is time to dispell the false choices conjured up by the bureaucracy and give the States the opportunity to change the future. Mr. President, 37 months ago, President Clinton promised the Nation's Governors that he would work with them to ``remove the incentive for staying in poverty.'' He told the Governors that ``many people stay on welfare not because of the checks * * * they do it solely because they do not want to put their children at risk of losing health care or because they do not have the money to pay for child care * * *.'' As President Clinton has indicated, Medicaid must be part of the solution for returning families to work. Separating Medicaid from the rest of the welfare reform package simply will not work. Medicaid reform is welfare reform. If the President genuinely wants bipartisan welfare reform, his administration cannot pitch the NGA proposal out as just so much straw. At that NGA meeting 3 years ago, President Clinton also told the Governors that the American people ``don't want our process divided by partisanship or dominated by special interest, or driven by short-term advantage.'' Mr. President, the Governors have given us the opportunity to meet this expectation. it is my hope that the President will join with us and embrace this opportunity. If the administration rejects this last best chance for bipartisanship in the next few weeks and welfare reform fails for a third time, the American people should clearly understand that Governors they elected were defeated by the Federal bureaucracy and the special interests it serves. The American people should then judge the administration not by its words but by its deeds.

Mr. ROTH

Mr. ROTH. Mr. President, I want to say a few words about recent developments in the United States-Russian trade relationship. In February, Russian Prime Minister Chernomyrdin announced a ban effective tomorrow--March 16--against imports of American-produced poultry to protect Russian farmers. This proposed ban is of great concern to American agriculture and, if imposed, would be a terrible blow to the American poultry industry. Our poultry sales to Russia have been one of our great exporting success stories. In 5 short years, Russia has become the largest foreign market for United States-produced chicken and turkey--worth over $500 million a year The tremendous growth in popularity of American poultry with Russian consumers is due, in no small part, to its recognized quality and reasonable price. On March first, I sent a letter and spoke to our trade representative, Mickey Kantor, expressing my concerns over the proposed Russian ban and Moscow's increasing protectionism against foreign imports. I ask unanimous consent that a copy of this letter be printed in the Record.

Mr. ROTH. Shortly after I sent that letter, Russian Prime Minister Chernomyrdin told Vice President Gore that the ban was off and that American poultry exports to Russia could continue uninterrupted. Based on press reports, I understand Russia's chief veterinarian still threatens to block imports of United States poultry. Mr. President, due to these conflicting signals from Moscow, it is unclear what action the Russian Government will take. I hope that Prime Minister Chernomyrdin is good on his word. We will have to see what the Russians do after tomorrow. However, if the ban is imposed, I strongly urge the administration to take the forceful and immediate responses I outlined in my letter to Ambassador Kantor--including retaliation against Russian imports into the United States, a freeze on Export-Import Bank loans and credits, and suspension of American foreign assistance programs to Russia. If these measures should prove to be insufficient, then I would urge the administration to reconsider United States support for a $10 billion assistance package the International Monetary Fund has promised Russia. Mr. President, if we do not send a strong message to the Russians, it will only encourage them to take further protectionist measures that will only hurt United States exporters, Russian consumers, and Russia's economic development as a full partner in the world economy. Russia's apparent swing to protectionism is particularly disturbing given the high level of American aid to Russia. Since the end of the cold war, the United States has given over $1.5 billion in foreign assistance to Russia, not including several billion dollars we have provided to promote Russian trade. In light of U.S. generosity, Moscow's protectionist bent against American products is simply astonishing. I trust that the Russian Prime Minister's word will be good, the poultry ban will not go into effect, and that Russia's commitment to free trade will not weaken, but will grow stronger.

Mr. ROTH

Mr. ROTH. Mr. President, therefore, I believe that we must act swiftly in passing this critical bill. Let me reiterate my position regarding the debt limit issue. It is this Senator's intention to work toward passage of a long-term debt limit extension later this month. We will not default on our debts. What this legislation does is simply allow a few more weeks to work out a few unresolved issues with the Governors proposals on Medicaid and welfare. Let me just take a few moments to summarize the bill for my colleagues. Section 1(a) of the bill provides the Secretary with the authority to invest receipts received by a trust fund or other Federal fund until March 30, 1996. Obligations issued under this authority shall not count toward the public debt limit. This is to ensure the full establishment and maintenance of income to Social Security and other Federal funds that by law are authorized to invest in Federal obligations and securities. Section 1(b) defines the term Federal fund as a trust fund or account to which the Secretary of the Treasury is authorized to issue Federal obligations for investment purposes. Section 1(c) extends the current authority--Public Law 104-103--to incur debt, not subject to the public debt limit for purposes of guaranteeing timely payment of Social Security and other Federal payments, from March 15, 1996 until March 30, 1996. Mr. President, I hope that the Senate expeditiously enacts this critically important piece of legislation to preserve the full faith and credit of the U.S. Government. Mr. President, I yield back the floor. Mr. MOYNIHAN addressed the Chair.

Mr. ROTH. Mr. President, how much time remains?

Mr. ROTH. Will the Senator yield me 1 minute?

Mr. ROTH. I yield the Senator 3 minutes.

Mr. ROTH. Let me suggest that the problem with the Moynihan amendment is that I think we do make it possible for there to be a default if we do not move successfully on the legislation before us. The House, I just want to point out, passed the legislation, H.R. 3021, by a vote of 362 to 51. Most of the ``no'' votes came from Republicans. The House leadership says that the Moynihan amendment would not pass on the House side. So it is unlikely that a straightforward debt limit bill will pass. The House wishes, as you know, to combine that with entitlement reform, and we intend to vote on that later this month. The point I want to emphasize is that we are running the risk that, if the Moynihan amendment should be adopted, it will not be agreed upon on the House side, and time is not on our side. As I said earlier, the amendment before us really jeopardizes the ability of Treasury to manage the public debt. We may not have until March 21 or even March 15, as I understand the situation. Treasury has informed us that next week, cash levels will be imprudently low, something under $1 billion. I think that is the first time that situation has arisen where we are running that kind of a risk. The distinguished Senator, my good friend and colleague, asked for the letter from John D. Hawke, Jr., the Under Secretary of the Treasury for Domestic Finance, to be printed as part of the Record. I want to read one paragraph from that letter where the Under Secretary says: By March 13 or 14, if there is no debt limit increase, we project that our cash balances will be below our prudent minimum of $5 billion and that there will be less than $1 billion in leeway under the debt limit. If the actual debt level on March 13 or 14 is $1 billion more than we currently forecast, Treasury would be out of debt limit room and would not be able to issue sufficient securities to the trust funds to enable all trust fund receipts to be invested on those dates. So that, in my judgment, is why we wish and need to enact H.R. 3021 now, unamended, so that this danger of running out of funds can be averted. Mr. President, I strongly urge my friends and colleagues on both sides of the aisle to reject the so-called Moynihan amendment.

Mr. ROTH. I yield 3 minutes to my colleague from Minnesota.

Mr. ROTH. Mr. President, I move to reconsider the vote by which the bill was passed.

Mr. ROTH. Mr. President, I respectfully rise in opposition to the Moynihan amendment. I am sure he recalls, as I do, that when George Mitchell was the distinguished majority leader of this Senate, he often said the perfect is the enemy of the good when Republicans offered amendments from time to time. I just want to reiterate that, as I stated earlier, it is this Senator's intention, hopefully upon the successful enactment of the legislation before us, without the Moynihan amendment, it is this Senator's intention to work toward passage of a long-term debt ceiling extension later this month. As I have said, we cannot and will not default on our debts, and I know that is a matter with which the distinguished Senator from New York agrees.

Mr. ROTH. Mr. President, I rise to ask my colleagues to join me in supporting H.R. 3021, a bill to extend the current debt ceiling until March 30, 1996. Under current law, the debt ceiling would be reached on March 15. This bill is intended to give the Secretary of the Treasury ample authority to ensure the full investment of all Federal funds and trust funds, including the Social Security trust fund, until March 30, 1996. Mr. President, I am told that the Secretary of the Treasury, Robert Rubin, supports this legislation and that President Clinton intends to sign it. Mr. President, I ask unanimous consent to have printed in the Record the letter received from Secretary Rubin.

Mr. ROTH. Mr. President, I thank the distinguished Senator from New York for his remarks. I must, once again, urge the defeat of the so- called Moynihan amendment. If it should carry, I think it is critically important that it be recognized that we would be jeopardizing the ability of the Treasury to manage the public debt. As I said earlier, we may not have until March 21, or even March 15. Treasury, again, has informed us that next week cash levels will be imprudently low and under $1 billion. That is the reason it is critically important that we enact H.R. 3021 without amendment. As I have assured the distinguished Senator from New York, then we will look at the longer term and work together. I yield the floor.

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

Mr. ROTH

Mr. ROTH. Mr. President, the House recently passed legislation to provide much needed tax relief for American troops who are performing peacekeeping services in Bosnia and Herzegovina, Croatia and Macedonia. When our young men and women wear our uniform in these war-torn regions, I want them to know that they have my unqualified support. I want them to know that they are there for a reason. They are on important missions--missions to help free these war-torn areas from their undemocratic pasts. While I would have preferred to limit our involvement to strategic and tactical air and sea support, we must now give our full support to our troops. This legislation provides much needed tax relief for our troops in Bosnia and Herzegovina, Croatia, and Macedonia. Let me briefly outline the major aspects of this legislation. First, the bill exempts from Federal income tax military pay received by enlisted personnel while performing peacekeeping services in Bosnia and Herzegovina, Croatia, and Macedonia. Second, the bill exempts military pay received by commissioned officers while serving in those areas in an amount equal to the highest monthly pay for enlisted personnel which is currently $4,104.80 per month. Third, military pay received by those hospitalized as a result of injuries incurred while performing peacekeeping services would be exempt from Federal income tax for up to 2 years after termination of peacekeeping activities in the hazardous duty area. Fourth, the bill extends the time for filing tax returns, paying tax and other deadlines to allow our troops to focus on their dangerous task rather than on tax deadlines. Fifth, the bill reduces Federal estate taxes and forgives Federal income taxes for those whose lives are taken while performing the peacekeeping mission. Let me just say that I am deeply troubled that similar relief was not provided to Americans killed while serving in Somalia. Sixth, the bill eliminates tax withholding on military pay earned tax-free in these hazardous duty areas. Seventh, the bill provides special rules for surviving spouses and couples who file joint tax returns, as well as an exemption from the telephone excise tax for calls made from the hazardous duty area. Finally, in addition to the tax relief for military personnel in the hazardous duty areas, the bill also postpones various tax deadlines for support personnel. To be eligible for such tax relief, the individual must be deployed away from such individual's regular duty station and performing services outside the United States as part of Operation Joint Endeavor. Such relief would be available to Department of Defense employees. I fully support this legislation and encourage the Senate to pass it quickly to ease the tax burden and tax filing requirements on our courageous American troops who are serving in these hazardous duty areas.

Mr. ROTH

Mr. ROTH. Mr. President, during the past few weeks, we have been advised in writing by the Secretary of the Treasury, Robert Rubin, that it is unlikely that the Government can continue to meet its obligations on or about March 1, 1996. The Secretary believes that he will not have any difficulty meeting the Government's obligations prior to that time. In view of these circumstances, some have suggested that the March social security payments--not the current checks, for February, but those for March--will not be payable. In order to allay any concerns, I am pleased to join the majority leader along with Senator McCain, in introducing this legislation to ensure Government solvency and payment of all Social Security benefits on a timely basis in March. I urge my colleagues to support swift passage of this legislation. Two important findings are stated at the beginning of this legislation. Two important findings are stated at the beginning of this piece of legislation which help explain our position. First, Congress intends to pass an increase in the public debt limit before March 1, 1996. Second, in the interim, Social Security beneficiaries should be assured that social security benefits will be paid on a timely basis in March 1996. Let me be clear, it is this Senator's intention to work toward passage of a debt limit extension before March 1. We will not default on our debts. That I find unthinkable. What this legislation does is simply ensure that timely payment of the March Social Security benefit payments and allow these checks to be mailed and cashed without any delay. The bill provides temporary relief from the current $4.9 trillion debt limit, and creates new legal borrowing authority not subject to the debt limit for a short period of time. The amount of this new legal borrowing authority is equal to the amount of the full Social Security benefit payments for March, approximately $28 billion. By creating new borrowing authority, this bill also allows full payment of all other U.S. Government obligations due on March 1, 1996, including veterans benefits, Medicare and SSI payments, Federal employee pay, and military and civil service retirement payments.