Alan Simpson

Mr. SIMPSON

Mr. SIMPSON. Mr. President, the insert was in the previous sentence and it is now correct where it appears, appropriately on the second line. That is the intent. It is what I read into the Record a moment ago. Let me just say to my friend from Michigan, ask my friends from Kentucky and Idaho, what we are finding is that there are groups in America who have tax-exempt status who, in effect, really skirt very closely to just truly big business. They are involved in big business. I hope that maybe my friend would help in making inquiry of the tax- exempt status of some of these organizations--not now, but in the future--because I intend to propose additional reform, especially in this area of unrelated business income tax, called the UBIT legislation, taxing sources, income, royalties, and I plan to look at whether we should tax royalties, tax commercial insurance income. That is tax legislation. That needs to go through finance. Here, I am dealing only with grants to lobbyists. That is what this is singularly to.

Mr. SIMPSON. We are not, Mr. President, involved in anything more than the singular amendment, saying that they shall not be eligible for the receipt of Federal funds constituting an award, grant, contract, loan, or any other form. We are not changing the tax-exempt status in that sense, although there have been many suggestions in both the hearing and on the floor and in discussion as to what to do with these groups. It is felt that this would be the most appropriate and understandable approach.

Mr. SIMPSON. Mr. President, that would be my understanding. If they decided to split into two separate 501(c)(4)'s, they could have one organization which could both receive grants and lobby without limit.

Mr. SIMPSON. As I understand the question--I am a bit preoccupied. You might ask it again.

Mr. SIMPSON. Mr. President, I just add that the problem is this: The Government in this situation, then, is subsidizing the activities, the benefits provided by the largest of lobbyists, who have this extraordinary advantage over all other lobbyists. And there are 25 different section (c) corporate tax exempts; there are 25 of them--the (c)(3)'s, which are familiar to most of us, and the (c)(4), (c)(5), (c)(6), and (c)(7), et cetera. It is the subsidization of the activities, the benefits provided, because they have the ability to spend as much as they wish. They have unlimited ability to inject as much money--if I might have the attention of my friend from Michigan, who I have the deepest affection and respect for. If we are really going to do something about big, big lobbyists, then it seems to me that we should direct it at the biggest ones of all, the ones who have unlimited ability to lobby. There is not a single restriction on a 501(c)(4). They can spend themselves into oblivion. I say, let them do that if they are going to raise their money from contributions and dues and the things that supposedly guide an organization's efforts and objectives, but not in grants, and on and on, from the Federal Government. That is the pitch. I am not directing it at any single institution. In my research, I came across these extraordinary things. There are some organizations listed on here that you and I probably have never heard of, that have millions and millions of dollars involved in lobbying. All we are saying is, Look, lobby to your little old heart's content. You just keep right on doing it. But if you are going to get Government support, then you are going to have to go to 501(c)(3), which is truly charitable, for religious, charitable, veterans, education, compassion, whatever you have to list. Let them do that. Let them go to 501(c)(3). You mentioned DAV. There is not a single group here listed in the 501(c) that could not qualify as having a charitable purpose and meet every test of a 501(c)(3).

Mr. SIMPSON. Under current law, yes.

Mr. SIMPSON. Mr. President, a 501(c)(4) corporation cannot, in that sense, use a Federal grant or award for ``lobbying" purposes.

Mr. SIMPSON. That is correct, Mr. President.

Mr. SIMPSON. In the Finance Committee.

Mr. SIMPSON. Mr. President, we have had a hearing on the issue of 501(c)(4)'s that receive money from the Federal Government. In this case, it was in the form of grants and awards. We have held a hearing.

Mr. SIMPSON. Mr. President, in response to the Senator from Michigan, if I understand the question, what we are saying here is if they get anything from the Federal Government in the form of an award, grant, contract, loan, or any other form, they can file as a 501(c)(3) corporation, nonprofit, or they can stay and continue their work as a 501(c)(4) corporation, but they cannot lobby.

Mr. SIMPSON. Indeed, I yield to my friend from Michigan.

Mr. SIMPSON. I appreciate that indeed. That is a reason. There is another reason, as I have observed it over the past many months. Oftentimes, these groups that obtain Federal funding and support will use that money to then lobby the Federal Government for more Federal support for their members. In other words, whatever the issue is--it may be health care, or whatever it may be--they are using the Federal support to then lobby for more Federal support, to get more money from the Federal Treasury for whatever issue is paramount on their screen. I think that is wrong. I add that.

Mr. SIMPSON. Yes, indeed.

Mr. SIMPSON. Mr. President, if each of those groups or members of those groups contacted their elected representatives, I am sure that they would be in shock, indicating that they were going to lose something. So what has occurred in this colloquy and with the second-degree amendment is a very important reiteration of points I made when I spoke during the offering of the amendment as to why the amendment is important. I think it has been clarified, but let us just do it one more time and, perhaps, if there are any further questions, I hope those who resist the amendment will enter the debate so that we can assure them that this amendment, now as second degreed by Senator Craig, does not prevent any 501(c)(4) organization from refiling as a 501(c)(3) and then accepting that category's limits on lobbying. The only circumstance in which they would be cut off from Federal funds would be if they chose then to remain entirely under 501(c)(4), in effect choosing the unlimited lobbying over the Federal grants. Under the second-degree amendment, they now have an additional option to stay in 501(c)(4) status without lobbying. So there is no attempt to restrict anyone. The 501(c)(4)'s have the ability--I hope you hear this--they have the ability to spend millions and millions of dollars without restriction. They have no restriction whatsoever. All we are saying is that in the language now of the amendment, as amended by the second-degree amendment--I am going to read it so it will be right in context in this debate, it will now read: An organization described in section 501(c)(4) which engages in lobbying . . . shall not be eligible for the receipt of Federal funds constituting an award, grant, contract, loan or any other form. That is the intent. It is, I hope, clarified now. And if there are those who are not in accord with the amendment, those in opposition, Senator Craig and I and others--

Mr. SIMPSON. Mr. President, I want to thank very much Senator McConnell for his precise inquiry here, and particularly Senator Larry Craig, my colleague from Idaho. There is no intent here to injure the groups that are listed under what I use as a pretty active resource, the GAO report on selected tax-exempt organizations. It gives a list of 501(c)(4) organizations. Mr. President, I ask unanimous consent that that list be printed in the Record.

Mr. SIMPSON. Mr. President, I thank the Senator from Kentucky. No one has been more vitally involved in these issues than my friend from Kentucky, Senator McConnell. And those are powerfully reliable words. I appreciate it very much.

Mr. SIMPSON

Mr. SIMPSON. Mr. President, that amendment is rather succinct. I believe that the amendment I have just put forward embodies an absolutely critical component of any truly meaningful lobbying reform. The amendment is identical to a bill which I was pleased to introduce with Senator Craig last Friday which has already attracted over a dozen cosponsors. By unanimous consent, Mr. President, we now split the underlying legislation into two complementary components--lobbying reform and gift ban legislation. I think all of us must agree that the issue of lobbyists' gifts to Senators must be dealt with in any attempt to protect the ethical framework of our activities here. I commend my friend from Michigan who came here when I did, Senator Levin, and many others who have worked so diligently on these issues of lobbying and gifts--and Senator McConnell and so many others. But my amendment gets to the heart of another major piece of the puzzle, one which we have inadequately dealt with thus far. This is the other side of the coin. This is about Congress' gifts to lobbyists in the forms of grants, loans and other benefits. Very simply, Mr. President, my amendment would forbid the delivery of Federal grant money to any 501(c)(4) organization--501(c)(4). Please hear that very seriously constricted and limited impact. This is an absolutely vital and fundamental and long overdue reform. I trust my colleagues may be fully aware of the relevant sections of the Internal Revenue Code pertaining to tax-exempt organizations. If so, they will see why this reform is absolutely necessary, and should be, I think, uncontroversial. First, let me assure my colleagues who may be wary upon initially hearing of this legislation. This amendment does not affect charities, nor any of the other tax-exempt groups which Members will certainly wish to protect, and should. This amendment would not affect any organization that is organized under section 501(c)(3) or 501(c)(5) or 501(c)6 or any of the other 25 categories, or maybe more, if I recall, of the Internal Revenue code. And I would remind my colleagues that 501(c)(3), which is not affected by this legislation, this amendment--this is the one that encourages activities, that are, and I quote directly from the code, 501(c)(3)'s are not affected by this amendment, are to ``Relieving the poor and distressed,'' or for ``Advancing religion or education.'' Thus, this amendment would not affect the Salvation Army, nor any other of the educational institutions in your State or any ``charities.'' Nor would it affect the tax-exempt groups that file under 501(c)(5) or 501(c)(6) of the Internal Revenue Code. These organizations include the labor organizations, and business organizations, groups such as the chamber of commerce, and the AFL-CIO--not dealt with here; no impact at all. This amendment deals very directly with section 501(c)(4) only. You can read that, the big lobbyists, the big boys and girls, and quite a list. That is the category that some organizations have chosen to file under when they want to spend an unlimited amount of money on the lobbying of the Congress. Unlike a 501(c)(3) which has a floating cap on how much can be spent on lobbying, there is no such cap on a 501(c)(4), none. This means that an organization under 501(c)(4) can under current law enjoy a tax exemption, enjoy receiving the Federal grant money and enjoy spending untold millions--that is the number, untold millions-- lobbying the Congress. This is huge loophole benefiting the powerful lobbyists at the expense of the collective interests of our citizenry. It is small wonder that we have such difficulty here casting votes to benefit the average citizen and Americans when we are simultaneously subsidizing the programs and activities of some of our largest lobbying groups. This is a reform that absolutely must be made, and soon. And there is no better place than I think the time today because there is a fundamental basic incompatibility between the current construction of 501(c)(4) law and the delivery of Federal grant money. I feel, after looking at it as carefully as I can, that rather than to design the limitations on the lobbying, or other advocacy activities of the 501(c)(4) organizations, that we should simply acknowledge that this is not the provision of the Tax Code under which altruistic, caring, charitable groups file. They do not file under 501(c)(4). But rather, this designation attracts those groups that are organized principally to lobby the Federal Government, and do so without financial limitations. There are, of course, and be assured, countless fine organizations doing good work and good works, organized under 501(c)(4) of the Tax Code. And if they wish to continue their administration of Federal grant money, certainly we should encourage them to file as a 501(c)(3) or any other available provision of the Tax Code. My amendment would not prevent the truly altruistic groups from doing just that, but if they wish to enjoy the benefits of 501(c)(4) and also enjoy the special privilege to lobby just as many bucks as their bank account will allow, then they should not be paid off in Federal grant money. I hope we might receive bipartisan support for this amendment, good bipartisan support. I have heard some of my colleagues take the floor at other times during this year to state that such lobbying activities should not be underwritten by the Federal Government. I have heard some on the other side of the aisle say that the NRA in particular should not be receiving Federal grant money. Many concur. So this is the Senate's chance to put an end to these conflicts of interest. I hope the Senators on both sides of the aisle will support this needed reform and vote to curtail the delivery of grant money to these, the most powerful lobbying groups and organizations in America. It is really a fundamental test of our sincerity in removing the decisionmaking process from obvious conflicts of interest. I ask my colleagues for their support with regard to the amendment. Mr. President, I will yield to Senator Brown whenever he wishes the floor, but let me speak another few moments.

Mr. SIMPSON. Mr. President, I send an amendment to the desk and ask for its immediate consideration.

Mr. SIMPSON. I thank my friend from Colorado. Amendment No. 1839 (Purpose: To prohibit certain exempt organizations from receiving Federal grants)

Mr. SIMPSON. I ask unanimous consent that the amendment be temporarily set aside and that we go forward with this.

Mr. SIMPSON. Mr. President, with the approval of the Senator from Colorado, may I ask that his amendment be withdrawn. My amendment should not take 5 or 10 minutes, unless the Senator from Colorado wishes to go forward.

Mr. SIMPSON. Mr. President, I thank my friend from Ohio. Mr. President, with regard now to the status of the situation on the floor, we are on the bill. Is that correct?

Mr. SIMPSON. Mr. President, has a quorum been entered?

Mr. SIMPSON

Mr. SIMPSON. Mr. President I rise to join my good friend and able colleague from New Mexico, Senator Jeff Bingaman. The two of us are reintroducing the very important legislation called the International Population Stabilization and Reproductive Health Act. During the last congressional session, Senator Bingaman and I introduced this bill to call attention to some very vital issues in this country and in the world. Our former colleague, Tim Wirth, championed these issues while he was in the Senate and, together, he and I laid the foundation upon which this bill is built, and then came my colleague from New Mexico, Jeff Bingaman--Senator Bingaman, who I thoroughly enjoy, and enjoy working with, his word is his bond. We work well together. He shares the same concerns and commitment to this crucial global issue as I do. I am pleased to be working in a bipartisan fashion with him so we can move forward with an effective public policy on an issue that affects everyone in some way, worldwide. The legislation we introduce today builds upon the Programme of Action Document adopted by acclamation by 180 nation states in September of 1994 at the International Conference on Population and Development in Cairo. At the conference, the United States was seen, as always, as the world's leader on population and development assistance. I was a congressional delegate at the conference. There were not a lot of colleagues seeking to go. Senator John Kerry was there and represented our country well. I came away much impressed with the leadership and direction displayed by our Vice President, Al Gore. Then, of course, assistance given to him by the now Under Secretary of State, former Senator Wirth, in guiding the conference and its delegates in developing a consensus document of a broad range of short- and long-range recommendations concerning maternal and child health care, strengthening family planning programs, the promotion of educational opportunities for girls and women, and improving the status and rights of women across the world. We surely do not want to lose our moral leadership role and relinquish any momentum by abandoning or severely weakening our financial commitment to population and development assistance. The United States needs to continue its global efforts to achieve responsible and sustainable population levels, and to back up that leadership with specific commitments to population planning activities. In my mind, of all the challenges facing this country--and there are plenty of them--and around the world--and there are plenty of them-- none compares to that of the increasing of the population growth of the world. All of our efforts to protect the environment, I have heard all of that in the last few days--protecting the environment, protecting this, protecting the aged, protecting the young--all the things to protect the environment and promote [[Page S 9909]] economic development around the world are compromised and severely injured by the staggering growth in the world's population. I hope my colleagues realize, of course, that there are currently 5.7 billion people on the Earth. In 1950, when I was a freshman at the University of Wyoming, not that long ago, there were 2.5 billion people on the face of the Earth. Mr. President, 2.5 billion in 1950, 5.7 billion today. If current birth and death rates continue, the world's population will double again in just 40 years. Despite some progress in reducing fertility rates, birth rates in developing countries are declining too slowly to prevent a cataclysmic near tripling of the human race before stabilization can occur. The bill as Senator Bingaman and I propose focuses on a coordinated strategy that will help to achieve world population stabilization, encourage global economic development and self-determination, and improve the health and well-being of women and their children. Fundamental to this legislation is a recognition of the fact that worldwide efforts to alleviate poverty, stabilize populations, and secure the environment have been undermined by a total lack of attention to women's reproductive health and the role of women in the economic development of their families, their communities, and their countries. Under the legislation, global and U.S. expenditure targets will be set for overall population assistance, with specific programs to help achieve universal access to culturally competent family planning services and reproductive health care; expand programs for treatment and prevention of HIV and AIDS and other sexually transmitted diseases; close the gender gap in literacy and primary and secondary education; and increase economic opportunities for women so they can realize their full productivity potential. Other initiatives authorized under this legislation will help to reduce global maternal and infant mortality rates, and improve the overall health status of women and their children by addressing problems such as unsafe abortion. This is not about abortion. I have been here a long time. Every time we bring up something that has to do with stabilization of the Earth's population, somebody throws in the issue of abortion. That is not what this is about. It is also about harmful practices such as female genital mutilation, along with malnutrition, low immunization rates, and the spread of contagious diseases. There is a real need throughout much of the developing world for access to family planning services, especially as to safe abortion. Women in these countries are desperately seeking ways to take control of their reproductive lives and cannot do so because there is a severe lack of access to such services. Worldwide, estimates are that 350 million couples want to space or prevent another pregnancy but lack the access to a full range of modern family planning. In addition, any comprehensive family planning initiative must include access to primary health care with an emphasis on child survival to reduce infant mortality. In many developing countries, parents have a perception that many of their children will not survive beyond their first birthdays. If these parent's fears are allayed, they will not feel much pressure to have more children than they actually desire in order to insure against the possible loss of one or more of their children before adulthood. This is why for all of these pressing reasons, I join today with my friend and colleague from New Mexico, Senator Bingaman in introducing this legislation. It is our aim to call attention to global population stabilization, to give it focus, and to make it a vital part of U.S. foreign aid and development assistance programs. We need to begin to make much-needed policy changes in international population stabilization, and the United States needs to take this lead to ensure that these new policy developments are recognized worldwide. This one is long overdue. Mr. President, I ask unanimous consent to have printed in the Record a summary of the bill.