Olympia Snowe

Ms. SNOWE

Ms. SNOWE. Mr. President, I have an amendment to offer.

Ms. SNOWE. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

Ms. SNOWE. Mr. President, I would like to inquire as to how much time is remaining?

Ms. SNOWE. Mr. President, I would like to say in conclusion that I certainly appreciate the efforts by the Senator from Michigan, and other colleagues and cosponsors of this amendment, on a very critical and important issue in our estimation. We want to be sure that the American people understand and know that we consider education to be one of the highest priorities. That is why we are seeking to restore $6.3 billion in the education account. When you consider the fact that since 1988 students' education costs increased by 219 percent, it is almost difficult to comprehend, because the average family has been struggling since that time in some very difficult and unusual economic times, considering the recession that we have had, certainly in my State of Maine and in the New England area, which was the hardest hit in addition to the other parts of the country, especially California. We represented a third of all of the jobs that were lost during the course of that recession. So when you consider the fact that education needs became more important, we have to make sure that they have access to adequate funding for financial assistance in the future. Not only is it essential for their future, but it also essential to this country's future when you consider how important the educational experience is going to be for global competition in and for the economic world we will be facing in the next century and beyond. So I appreciate the statements that have been made by all of my colleagues. Mr. President, I ask for the yeas and nays.

Ms. SNOWE. Mr. President, I yield 5 minutes to the Senator from Iowa, Senator Grassley. Mr. Grassley. Mr. President, I want to speak briefly in support of the amendment offered by Senators Snowe, Abraham, and myself. Let me just say that as the 2d ranking Republican on the Budget Committee, and having served on the Budget Committee for over 14 years, how much the committee has benefitted from the infusion of knowledge, ideas, and energy from these two Senators, Senator Snowe and Senator Abraham, as well as Senator Frist, the other newcomer to the committee. I am pleased to be joining these two Senators as an original cosponsor of this amendment which lessens the debt our undergraduate students will face and also ensures that students will not be denied eligibility for loans because of the value of their family's home or farm. I commend the Senators for offering this amendment. It should not be forgotten though that it is this budget resolution and the tremendous work of Chairman Domenici that will do so much to benefit our students, both undergraduate and graduate. The lower interest rates that will be achieved by getting to balance by 2002, will translate into hundreds of millions in savings for students who are paying off their student loans. It is important to note that this amendment offers real offsets for the programs it wants to fund. This amendment doesn't do across-the- board cuts, or worse, tries to pay for it by assuming funds from the economic dividend. This amendment provides real offsets from other discretionary spending. I would like to comment briefly on one of the offsets--cutting back part of the Government's private airlines. I have asked the GAO to review the number of planes that are owned by the Federal Government. Incredibly, the Federal Government, not including DoD, has over 1500 planes--most of which are owned. Agencies like the Panama Canal Commission, the Resolution Trust Corporation, and the General Services Administration all have planes. Now many of these planes are necessary, and do have important missions. However, GAO has found that a significant number of these planes have as their primary mission ferrying senior Government officials around. Similarly, the President's Commission on Integrity and Efficiency has found that many of these aircraft are not necessary. When we are asking others to tighten their belts we cannot continue to fund a private airfleet for Government officials. A good example of the wastefulness of these Government-owned aircraft is highlighted in a recent report by the NASA inspector general: Several NASA aircraft were used by NASA employees, other Government employees, and non-Federal travelers for official travel at higher costs than using commercial airlines. An analysis of fiscal year 1992 and fiscal year 1993 travel, comparing the cost of travel using seven of the eight aircraft--NASA owned aircraft--with the cost of using commercial air flights, showed $5.9 million could be saved annually by using the commercial flights. This amendment assumes the selling of only a small number of planes, 150, approximately the number that GAO believes are being used for travel purposes. The amendment still allows the Government to retain over 1,400 planes to achieve their missions. This is a good amendment, I am proud to be a cosponsor of this amendment that will help young people to attend college. I yield the remainder of my time.

Ms. SNOWE. Mr. President, it gives me a great deal of pleasure to yield as much time as he may consume to Senator Abraham of Michigan, who helped in developing this amendment. I was pleased to work with him because we share the goal in advancing the needs for our families in this country with respect to education.

Ms. SNOWE. I yield back the remainder of my time. Mr. BUMPERS addressed the Chair.

Ms. SNOWE

Ms. SNOWE. Mr. President, I thank the Senator for yielding and concur with the remarks that have been made by the Senator from Colorado in terms of being able to deal with the facts, because I think that this issue is far too important to ignore the realities of the problem that are facing this country for now and future generations, but also the facts with respect to the plan that is before this Senate. First of all, as a member of the Senate Budget Committee, I certainly Budget Committee for doing a magnificent job and providing the leadership necessary to bring forth a balanced budget plan. What has been interesting about this debate so far as a member of the Senate Budget Committee and formerly as a Member of the House of Representatives in the last Congress--I also served on the House Budget Committee--at that time we were in the minority and we were challenged by the President and administration officials as a minority to bring forward our specific recommendations for budget cuts. The President put forward a plan and challenged Republicans to bring forward a plan. We did and it was rejected by the Democrats and it was rejected by the administration. But nevertheless, we put forward $433 billion worth of specific deficit reduction recommendations. Now, here today, we are in the majority and we feel that we have a responsibility, as we promised the American people, to provide a balanced budget by the year 2002. Indeed, the first month of this Congress, we debated a constitutional amendment to balance the budget. We heard, time and time again, from many Members of the minority, who said, ``I support a balanced budget. I think we should balance the budget. I think we should have a balanced budget by the year 2002, but I do not think a constitutional amendment is necessary.'' In fact, we passed an amendment instructing the Budget Committee, with a vote of 87 to 10, to come forward with a balanced budget plan. What has happened in the interim is that we have had no alternatives from the minority as to how to balance the budget. What we have heard today here, and in previous debates, is attacking and criticizing the specifics of our plan. I do not doubt that we can find fault with a plan that attempts to balance the budget over the next 7 years, given the fact that it has been 26 years since this Nation has experienced a balanced budget. But the fact is that there has been no constructive contribution as to how we balance the budget. I have two charts here, because I think it is important to illustrate the point. To my right, we have the balanced budget proposal before the Senate. You can see over 7 years, we find that in the year 2002 we put the budget back into the black. It is not perfect. There are a lot of things I do not like in it either. But we have to get to a bottom line, which is to balance the budget by the year 2002. It is in the interest of this country, in the interest of future generations to do just that. Now the other chart I have is pretty much of a blank. It is the Democrat plan to balance the budget. There is nothing. We are not debating alternatives or competitive plans. We had a vote earlier today on the President's plan. The vote was 99 to zero against. So the point is that the only plan before this Senate is a credible CBO-scored plan that says we can balance the budget by the year 2002. We have no other plans. We heard in the Senate Budget Committee, well, it is not really a balanced budget because we have not addressed the surplus of the Social Security trust fund. Again, I agree, that would be another approximately $700 billion that we would have to address beyond the $1.2 trillion. But I also would suggest that this plan gets us off the trust fund eventually and is the only plan to do so. Now, if other Members have suggestions as to how we can take the trust fund off now with finding an additional $700 billion in cuts over and above the $1.2 trillion we have to find to balance the budget by 2002, we would welcome those recommendations. But you hear time and time again about attacking specifics of this plan and what we have done. But they do not talk about the positive benefits, which I will get into in a moment. They do not have an alternative. You do not hear about competing balanced budget plans here. We do not hear about constructive recommendations as to how we can do it differently. All we are hearing is criticism and bickering about what is wrong with the plan. I think that those who support the principle of a balanced budget, and support it in reality, have an obligation to come forward with a specific plan and alternative if they cannot support this plan. They owe it to the American people. We can cite, as we did in committee time and time again, the fact that many Members made statements in the last few months saying how much they supported a balanced budget and they wanted to work together. But when we faced that reality in committee, we did not have any ideas forthcoming. They talked about spending a dividend that might or might not materialize at the end of 7 years, and the Congressional Budget Office has said if in fact we put in place a plan over 7 years that balances the budget, we can realize a dividend of $170 billion. But that will happen over 7 years, assuming that all we put in place happens. So what we faced in the committee were numerous amendments on how to spend the dividend. There were more than $500 billion worth of recommended increases in spending. But we did not get the corresponding reductions. We did not get recommendations as to how we could cut this budget and balance it by the year 2002. So I think that people as they are watching these debates are going to understand the difference between those who are trying to do something for the future of this country and those who are not doing anything. The President's budget, as I mentioned earlier today, did not address the issue of deficit reduction. In fact, the President's budget that was enacted in the last Congress, which represented the largest tax increase in the history of this country, only provided $88 billion worth of spending cuts over 5 years of a collective budget--over 5 years of perhaps $6 trillion. The budget that the President put forward this year actually only reduced Federal spending by $32 billion over 5 years which, again, represents over 5 years of collective budget of $6 to $7 trillion. And he only recommended $32 billion in that period of time. One of the previous speakers said we have had 3 consecutive years of declining deficits. Yes, that was the good news. But the bad news is that the deficit is going back up. That is the whole point. That is the major problem facing this country, because the President's budget and plan from the past, as well as the one he recommended to Congress this year, add another $2 trillion worth of debt by the year 2002--another $2 trillion. In fact, the deficit will be $100 billion larger in the year 2000 than what the President had predicted in the budget that he submitted to Congress this year. It will be $100 billion larger. That is not even taking into account, according to the Congressional Budget Office, high inflationary periods or a recession. That is assuming that everything goes well economically between now and the year 2000. So, in fact, that could be even a higher number, a higher number than the $100 billion more than the President had projected for the year 2000. So those are some of the facts that we are attempting to deal with. I feel if people have constructive criticism, then they have to recommend ways in which to balance this budget differently. But that is the bottom line. If you believe the magnitude of the debt is going to seriously impair this country's ability to prosper and provide the kind of standard of living that the American people deserve, then you have to support this plan, because this is the only plan that is before the Senate. I know some of the previous speakers also mentioned tax cuts, which is something that was in the House plan. Well, this is the Senate plan. We do not have tax cuts in this plan. We hear about tax cuts and other things that have no relationship to the plan that is before the Senate. And it is very, very important, I think, to make that distinction. This plan before us today will balance the budget for the first time in 26 years in American history. The last time we had a balanced budget in this country is when America put a man on the Moon. Our deficit and our debt have grown 1,250 percent since we last balanced the budget back in 1969. That is what we are talking about. There is no other way in which to face this problem other than to make some of the tough choices now. I think everybody agrees provided it is fair and is responsible. First of all, I should say that our plan saves Medicare. We have heard an awful lot about Medicare today. It is a very, very important program. So important that I would think that everyone would be concerned about the trustees' report which indicates without question that the hospital insurance trust fund will be insolvent by the year 2002. It is the Medicare trustees--they are not Republicans--and it was not the Budget Committee who have predicted the insolvency or the bankruptcy of the Medicare Program in 2002. Understand one thing: If we do nothing, if we do nothing about the Medicare problem, there will be no Medicare benefits for any of the 36 million Americans it serves after the year 2002. None. It will not exist. By law, the Government is prevented from providing any benefits if there are no assets in the insurance trust fund. I would like to quote the Medicare trustees themselves, who stated the following: With the magnitude of the projected actuarial and hospital insurance program, the trustees urge Congress to take additional action designed to control the hospital insurance program costs. The trustees believe that prompt, effective and decisive action is necessary. That is exactly what we do in our document. Amazingly, the minority has no proposals, no ideas, to remedy the Medicare crisis. This, despite the fact that three of the Medicare trustees are actual Cabinet Secretaries, and they still refuse to admit there is a crisis. They say it has been mentioned before. Well, we have 7 years in which to address the problem. As several of the trustees testified before the Senate Budget Committee recently, they said we have to take some action because it is going to take some time to have an impact on the revenues of the trust fund. We cannot wait until the year 2002. We cannot wait until the year 2000. We cannot even wait until 1997. It has to be done now, in order to have a positive impact. I, personally, think that the 36 million Americans who depend on this program--and more in the future because we will have more people retiring--is that they should have a sustainable health care program. Now, we have one of two choices. We either attempt to address it this year or we ignore it. I, frankly, think we have a responsibility to address this problem. So this is not a manufactured number. It is not a manufactured crisis. This is from a report that was done by the trustees of the Medicare system. This just came out. Three of the President's Cabinet Secretaries are on this board. They have said that there is a problem. I think that we do have an obligation. Now, I think the President recognized that there has been a problem because in the past he has been quoted on several occasions, and I have these quotes on the charts because I think it is important to remind everyone that the President spoke about these issues as well when it came to Medicare and the growth and the problems we have in the future. He said at one meeting, back in April 1994, ``Then we'll be able to lower the rate of inflation--keep in mind, we do not propose to cut Medicare and Medicaid, Ma'am,'' in answer to a question at a town meeting. ``Medicare and Medicaid under our proposal would go up at twice the rate of inflation, instead of three times the rate of inflation.'' Then, back in October 1993, in speaking to the AARP, a very important organization that represents senior citizens in this country, he said, ``Today, Medicaid and Medicare are going up at three times the rate of inflation. We propose to let it go up at two times the rate of inflation.'' Now, that is less than what we have in our budget. We have much more. ``That is not a Medicare or Medicaid cut. Only in Washington do people believe that no one can get by on twice the rate of inflation, so when you hear all this business about cuts, let me caution you that is not what is going on. We are going to have increases in Medicare and Medicaid.'' I think we owe it to the seniors of this country to begin to address this problem. In this proposal, we are recommending that we establish a bipartisan commission to recommend ways in which to address the insolvency of the program that will occur in the year 2002, according to the trustees, when they issue their report. Now we heard many say it has to be done within the context of comprehensive health care reform. I think we ought to have health care reform. I think it is an imperative. Hopefully, we will be able to address that, as well, in this Congress. We asked the trustees when they appeared before the committee as to whether or not we should have comprehensive health care reform in order to address this problem, or should we do it on a separate, legislative approach. Mr. Ross responded, I, personally, believe there may well be a two-step process that is necessary, doing those things that can be done now to address things that can be affected in the short run, while setting up a process to deal in a more long-range and fuller basis with the problem in the context of broader health care reform. The other trustee was asked, What are the alternatives if we do not address the problems? And Mr. Walker said, ``Delaying will only serve to increase the difficulty and the severity of any related changes. In addition, failure to address the financial imbalance in the Medicare programs will likely have long-term adverse consensus on Social Security, since the Congress has had a history of redirection of funds for the relatively better financed,'' because none of these programs is well financed, ``the relatively better financed programs in the short- term in order to shore up the troubled programs.'' What they were recommending is that we take action in the short term and, yes, then address some of the other issues in the context of health care reform for longer-term recommendations for the long-term stability of the program far beyond the year 2002. The trustees also estimated that it would take an immediate 4-percent increase in the payroll tax or an immediate reduction in Medicare spending by 30 percent to deal with the insolvency issue if Congress does not make the changes in the system. Obviously, we do not want that to happen. That is why, I think, that a commission on Medicare would be very, very, helpful. Our plan before the Senate today actually increases Medicare spending and saves the Medicare Program from going bankrupt in 7 years, as the Medicare trustees have predicted. Our plan provides for overall cumulative spending for Medicare over 7 years of $1.6 trillion. Medicare spending will climb from $178 billion this year to an estimated $283 billion in the fiscal year 2002 under this proposal, an increase of $105 billion, or almost 60 percent above this year's outlays alone. Moreover, per capita spending on Medicare under this measure will rise from $4,950 per Medicare beneficiary in 1995 to more than $6,400 per person in the year 2002, a 29-percent increase. That is an increase of over $1,500 in 7 years, or an extra $200 per person each year in Medicare spending. Our plan also protects Social Security. That is why I am also amazed that so many here have said in their previous speeches that somehow this plan affects Social Security. They said that about the constitutional amendment to balance the budget, as well. But there is nothing more important to the Social Security trust fund than making sure that we get our house in order with respect to our Federal budget deficits. The more we spend in the red, the more we borrow from the trust fund. It is paramount for Social Security recipients that we address the deficit issue and make every attempt to restrain the growth of our national debt. That is the real threat to the Social Security program. The fact is that no less than 10 percent of our Federal debt, much of which has been added over the last 2 years, is already owed to the Social Security trust fund. That is why it is so critical for us to balance the Federal budget. In fact, the former Commissioner, Robert Myers, of the Social Security Administration--he was Deputy Commissioner in 1981 and 1982, and he also, in 1982 and 1983, served as the Executive Director on Social Security reform--this is what he had to say: In my opinion, the most serious threat to Social Security is the federal government's fiscal irresponsibility. If we continue to run Federal deficits year after year, and if interest payments continue to rise at an alarming rate, we will face two dangerous possibilities. Either we will raid the trust funds to pay for our current profligacy, or we will print money, dishonestly inflating our way out of indebtedness. Both cases would devastate the real value of the Social Security trust funds. Further quoting Mr. Myers: Regaining control of our fiscal affairs is the most important step that we can take to protect the soundness of the Social Security trust funds. I urge Congress to make that goal a reality. So our plan preserves a secure legacy for future generations. We are not embracing the status quo. We do not want to condemn future generations to impossible choices on spending, which is what the administration's plan certainly offered, and certainly what the minority's plan has offered, which is no plan. So there are no choices here. And that is why this proposal before us today is so critical. Because this is the only plan that will address the indebtedness of this country, and to put us on a more stable path. You might ask, if we do nothing to end the rising tide of debts, what happens to the young people of today and to future generations? It is interesting to note, the National Taxpayers Union has estimated that a child born today will have to pay over $100,000 in extra taxes over the course of his or her lifetime in order to pay just the interest on the debt which will accumulate in the next 18 years. And for every $200 billion in new deficit spending, a child born today will need to pay an additional $5,000 in taxes, just to cover the interest charges. Tax burdens are so enormous that projections are that a child born today will now have to pay between 90 and 100 percent--90 and 100 percent--of his or her income in order to pay for the expected spending. That is simply not a fair burden to place on future generations. It is morally reprehensible and financially disastrous. On the contrary, our plan will relieve future generations from having to carry the yoke of debts and deficits by reaching a balanced budget by the year 2002. That is our gift to the next generation of Americans. And they deserve no less. While much has been said recently about supposed tax reductions in our plan, I would like to make one thing clear once and for all. In our plan, deficit reduction and balancing the budget is our only priority. Lest we forget, it was this very administration which took great pride and effort to preempt the new majority in Congress last November after the election by issuing its own tax cut proposal to the American people of at least $69 billion. As the majority of Americans in every income bracket have expressed in opinion poll after opinion poll, we understand that deficit reduction must be our first priority, our only priority in this budget plan and our first order of business. And that is exactly what you are going to find in this budget proposal. It is nothing more and nothing less. Under our plan, the Federal Government spending will be slowed by $961 billion over the next 7 years, reducing Government outlays from a total of $12.8 trillion to $11.9 trillion. If we are going to lead by example, we should in deficit cutting, and we have in our budget. In fact, we place a strict 7-year freeze on all pay for Members of Congress because we think it is important that we do all that we can to make sure that we are contributing to deficit reduction. In fact, I think we should do more. In addition to reducing Federal spending, our plan reduces the albatross of Federal bureaucracy. Our budget proposal reduces the size and scope of a Federal bureaucracy that has overtaxed, overregulated, and overextended itself over past years, hurting small businesses, middle-class families, and economic expansion. Our plan eliminates dozens and dozens of Federal departments, agencies, and programs. It abolishes unnecessary bureaucracy, eradicates Government waste, terminates duplication, and consolidates and streamlines Federal programs to improve efficiency and prioritizes our very limited Federal resources. In short, our budget plan puts the Federal Government on a much-needed low dollar diet, and applies some fiscal therapy to our governing institutions. What did the administration attempt to do? I remind you, the President, back in June 1992, said that he was going to have a 5-year plan for the American people to balance the budget. Of course, he never presented that to the Congress. He has never developed such a plan. But in his budget for fiscal year 1996 he eliminates just one Federal program, the Interstate Commerce Commission. That was the administrations's commitment to reducing the size of Government in Washington. But I think it is important to look at the benefits of a plan to balance the budget by the year 2002. A balanced budget plan prepares America for future economic growth. It is right for America because the balanced Federal budget is good economics, good accounting, it is good for job creation, it is good for productivity, it is good for savings, it is good for reducing taxes, and it is very, very important in restoring the faith and trust that is essential for America to have between government and the people. According to the General Accounting Office, if we balance the budget by the year 2002, the average American will have a real growth in income of 36 percent by the year 2020. Others predict that passage of a balanced budget will result in a 2.5-percent drop in interest rates, while the Wharton School of Business predicts a 4-percent drop. With a 2.5-percent drop in interest rates, our interest payments will be lowered by more than $600 billion between now and the year 2002. Finally, it has been pointed out that when we do have a balanced budget, in the year 2002, interest rates will stay around 3.5 percent. For average homeowners this will mean a savings of $500 per month on their mortgage payments. Another reason we must have a balanced budget set forth in our plan is because our Nation cannot continue to live in a fiscal condition where our standard of living is being continually challenged and lowered by the effects of annual deficits and increased debts. Without a balanced budget, America will become a second-rate economy with a second-rate standard of living. We can no longer afford a gross interest payment on the debt of $339 billion this year and $372 billion next year. Within a few years--and this is an amazing statistic--the interest on the debt will consume 50 percent of all discretionary spending. In fact, since 1980 interest on the debt is the only area of the budget that has grown faster than entitlements, at a rate of 120 percent. We can no longer afford a debt of $4.9 trillion, a debt so large that each person's share of the debt would have grown from $18,500 today to $23,700 per person, under the President's proposal, in 1999, a proposal, as I mentioned, we soundly rejected this morning by a vote of 99 to zero. So who says bipartisanship is nonexistent when it comes to recognizing a bad budget? We can no longer afford to continue to allow the income of American families to deteriorate because of the Federal Government's fiscal ineptitude. According to the Concord Coalition, without the debt burdens imposed by recurring debts, the average family income would be $50,000 rather than $35,000. The truth is, our plan for a balanced budget by the year 2002 is the right plan for America because, if it passes, it will be the very first balanced budget in more than a quarter of a century. Today, 26 years and a generation later, we have a chance to restore some fiscal equilibrium in our country. So now is clearly the time. Judging the trends, now is the time to act or we will quickly reach a dangerous and irresponsible point of no return. In the 1960's, deficits in America averaged $6 billion per year. In the 1970's, deficits averaged $38 billion per year. In the 1980's, they averaged $156 billion per year. So far in the 1990's they have averaged almost $260 billion per year. Clearly, signs are pointing to a worsening of economic conditions before we reach an improvement. That is why this is potentially our last rendezvous with history. We have tried different paths before. We have tried numerous legislative fixes, jump-starts, we have even tried statutory attempts like Gramm-Rudman-Hollings and the Rudman Act and the Byrd Act, and the [[Page S7001]] Humphrey-Hawkins Act. We tried rescissions and freezes and spending caps, and some, like the administration, even resorted to onerous tax hikes to get the American people to pay for the Federal Government's inaction. But the fact is that the problem remains, and it has only gotten worse. I think, Mr. President, that we can do better, and we must do better. This plan sets aside the gimmicks, and balances the budget and the old fashioned way with real budget priorities, spending reduction, and fiscal responsibility. It will allow us to start anew and to plan for a brighter future for our children as they pursue their own American dream. Our children's legacy is too priceless to be squandered. Mr. President, I yield the floor. Mr. ROBB addressed the Chair.

Ms. SNOWE

Ms. SNOWE. There is no question as to where we need to go and who is being responsible for the future of this country.

Ms. SNOWE. I thank the Chair. I thank the chairman of the Budget Committee, Senator Domenici, not only for yielding me this time but, as a member of the Senate Budget Committee, I have certainly appreciated the leadership he has provided on this most serious and critical of issues. I am a little surprised by what the Senate minority leader mentioned earlier when he said that offering the President's budget which he offered this year for fiscal year 1996 was really empty, meaningless, and not a serious gesture. What is that saying, that the President was not serious about offering his proposal to the American people to address deficit reduction and, indeed, balancing the budget for future generations? I think it is a sad commentary to suggest that the President is not serious in engaging in this issue. Is he suggesting that the President does not want to be relevant in balancing the budget and joining Congress in doing what is important for the American people? I think it is very much a fair comparison because we have heard over and over again about the proposal that came out of the Senate Budget Committee. We worked very hard. We wanted a bipartisan agreement. But the administration's proposal is a monument to status quo. The irony is that the administration has referred to the Republican budget resolution, which achieves a balanced budget through serious deficit reduction by the year 2002--that is what, in fact, many of the minority Members of the Senate have indicated during the debate on the constitutional amendment to balance the budget, that they did want to balance that budget by the year 2002. They just did not want a constitutional amendment to balance the budget. But the administration and administration officials have referred to our budget as ``dumb and dumber'' and ``clear and present danger.'' Frankly, if the administration would like to invoke a film fee, I would be happy to oblige them because, due to the years and years of deficit and red ink that the President extends in his budget into the next century, I certainly would describe the President's budget as the ``crimson tide'' because that is the legacy the President is leaving future generations. That is in fact his budget. It is a sea of red ink. Compare that to what we have offered in the Senate Budget Committee-- responsible deficit reduction that does achieve a balanced budget by the year 2002. I think it does not take an Einstein to figure out who is doing something for the future of this country, for the future of children and seniors and the stability of this country. Do we leave a monument of red ink to future generations just beyond the turn of the century that will require them to pay an 82-percent tax rate to finance this red ink that is in President Clinton's budget? Or do we do something now so that they can have a better future and invest in the priorities that everybody wants this Nation to invest in, such as education and health care and our infrastructure? They cannot do that with the President's budget, because it is a sea of red ink. So I am dismayed that the President offered a budget that was not serious in reaching and achieving a balanced budget by the year 2002. The fact is the President is offering $2 trillion by the year 2002 in additional debt. Even the Washington Post had this editorial comment a day after the President released his budget, and I quote: It is troubling that he has now decided to take a holiday from the hard and painful responsibility to keep working the deficit downward. The issue is this country's future standard of living. Even the distinguished ranking member of the Senate Budget Committee said earlier today that he was not enthusiastic about the President's plan. In fact, he noted a month or two ago ``In the administration's failure to chart a new fiscal course for our Nation,'' he said, ``the President dropped the ball by offering a budget that falls short, way short of the deficit reduction we need.'' This budget tells a tale of two Presidents, one who promises a balanced budget and another who fails to deliver; one President who promises deep cuts in the Nation's deficit and another who oversees a more than doubling of the predicted deficit in the year 2004; and one President who promises middle-class protection and another who saddles the middle class with increased per capita debts, increased taxes on Social Security benefits and increased taxes on those who own family farms and small businesses. Simply put, there is a nagging fundamental disparity between what this President says and what he does. It reminds me of the Shakespeare quote ``action is eloquence.'' If that is the case, we better tongue- tie the administration when it comes to budget policy and economics. President Clinton made a statement on April 15 in which he presented a three-point legislative priority list which included welfare reform and crime, but he also mentioned tax and spending cuts that both reduce the budget deficit and the spending deficit. But you would not know that reducing the deficit was even one of the President's legislative priorities because, again getting back to this chart, he has $200 to $300 billion in annual deficits between now and the end of this decade and beyond into the next century. The President had said in February that his budget plan will by 1997 cut $140 billion in that year alone from the deficit. Well, that being the case, it must have been another President that crafted the budget plan for the next 5 years. According to the reality-based reestimate by the Congressional Budget Office, the 1996 budget deficit will be $211 billion, not the $197 billion the administration projected. The 1998 deficit will rise to $231 billion, not the $196 billion projected by the administration, and the 1999 deficit will reach an estimated $256 billion, a far cry from what the administration projected of $197 billion. And if that is not bad enough, we have to look at the year 2000. CBO says the deficit will reach $276 billion rather than the $194 billion projected by the administration. That is almost a $100 billion difference in the deficit between what the administration projects and what the Congressional Budget Office estimates.

Ms. SNOWE

Ms. SNOWE. Mr. President, I rise in support of the bill, S. 534, as amended. Let me first thank Senator Chafee, the chairman of the full Environment and Public Works Committee, and Senator Smith, the chairman of the subcommittee, for their assistance to Senator Cohen and me on several amendments of great importance to the people of Maine. We offered three amendments to this bill, and all of them have been accepted, for which I am very grateful. The amendments relate to put- or-pay contracts, the term ``original facility'' on page 58 of the bill, and to the ``substantial construction'' requirement on page 56. I would also like to thank the ranking members of the full committee and the subcommittee, Senator Baucus and Senator Lautenberg, for their cooperation and acceptance of our amendments. And finally, I would like to thank my colleague from Maine, Senator Cohen, for working with me on these amendments on behalf of the State of Maine. Mr. President, Maine has had a keen interest in the issue of flow control since the U.S. Supreme Court issued its ruling in C&A Carbone, Inc. versus Town of Clarkstown, New York almost 1 year ago today, on May 15, 1994. That ruling, which invalidated municipal solid waste flow control ordinances across the country, threatened to unravel the painstakingly crafted waste management systems of local governments in Maine and many other States. Over 200 municipalities in my State made expensive investments in modern waste-to-energy facilities based on the assumption that flow control authority would be available to them. As a result of the Carbone decision, they now fear for their future financial well-being. S. 534 focuses primarily on municipalities that issued bonds to pay for the construction and operation of designated waste management facilities like waste-to-energy plants. These municipalities relied on flow control ordinances to meet their financial obligations and to repay the bonds. The bill contains a grandfather provision that allows these communities to continue using flow control as long as they enacted their original flow control ordinances and designated their waste management facilities before May 15, 1994. At first glance, the bill's grandfather provision would appear to protect the communities associated with the Regional Waste Systems waste-to-energy plant in Portland, ME, and the Mid-Maine Waste Action Corp. plant in Auburn, ME. These municipalities banded together in the 1980's to construct the facilities, and they issued bonds to pay for that construction. Flow control ordinances were enacted to guarantee delivery of sufficient amounts of waste to the facilities. But separate provisions in the bill would unintentionally and unfairly exclude many of these communities, and Senator Cohen and I offered amendments to rectify these problems. The first problem relates to the bill's use of the term ``original facility'' when it defines the duration of the flow control authority available to qualified political subdivisions in the future. Title II, subsection (b)(4)(C) allows qualified municipalities to continue using flow control through the end of the remaining useful life of the original waste management facilities that had been designated. The problem with the term ``original facility'' is that it could be interpreted to exclude facilities that had been the subject of the original designation by a group of municipalities, but that had also been overhauled prior to the Carbone decision. The MMWAC facility in Auburn, ME, is one facility that could have been unintentionally excluded from S. 534's grandfather provisions by this language. Due to significant deficiencies, the MMWAC plant, which had been constructed in 1988, was temporarily shut down in 1990, and subsequently overhauled. The plant resumed operations in 1992, and it has functioned well since that time. Under the original language of the bill, a party could have argued that because of the renovations, MMWAC could not be considered an original facility, and therefore flow control would not be available to its member municipalities through the plant's remaining useful life. The amendment that I offered with Senator Cohen, and which has been accepted, deletes the word ``original,'' and ensures that municipalities whose designated waste management facilities were in operation as of May 15, 1994, will be able to continue using flow control through the remaining useful life of the facility. Another problem in S. 534 relates to the `substantial construction'' requirement found in title II, subsection (b)(1)(B). This provision States that qualified municipalities would only be able to use flow control if the ordinance or legally binding provision in existence before Carbone had been enacted or signed before ``substantial construction'' of the designated facility had been completed. Unfortunately, more than 61 municipalities in Maine had enacted flow control ordinances or legally binding provisions after the substantial construction of their designated facilities had been completed. Even more problematic, this provision requires the ``substantial contruction'' to have been completed after the ``effective date'' of the ordinance or provision, rather than the date of enactment. As a result of this language, most of the municipalities in Maine that would otherwise qualify for S. 534's grandfather provision would be denied the bill's protection. Municipalities in Tennessee, Michigan, and other States would be similarly affected. In recognition of the unintentional problems that this language poses for so many otherwise qualified municipalities, I joined Senators Cohen, Smith, and Thompson in offering an amendment to strike this language. As I noted earlier, that amendment has been accepted by the managers of the bill. The last amendment that Senator Cohen and I offered relates to put- or-pay contracts. Municipalities that signed put-or-pay contracts with designated facilities prior to Carbone, but that did not enact flow control ordinances before that date, do not qualify for flow control authority in S. 534 as written. Under a put-or-pay contract, a municipality agrees to deliver a specified amount of waste to the designated waste management facility every month. If the muncipality cannot deliver the required amount of waste, then it must pay the facility for the waste that was not delivered. In Maine, 160 communities in the sparsely populated central, eastern, and northern parts of the State determined that the put-or-pay approach was the best one for them, and they signed contracts with the Penobscot Energy Recovery Corp. [PERC] in Orrington, a $100 million waste-to- energy plant. These cities and towns signed long-term contracts with PERC in response to the same policy signals from the Federal and State governments as communities that actually issued bonds to pay for municipally-owned facilities. The difference is that the PERC towns chose a somewhat different route. They owned waste-to-energy plant that was created in response to a request for proposals from these communities. The original contracts, which were 30-years long and set a tipping fee at $10 a ton, were signed in 1988. Due to financial difficulties that threatened the plant in 1989, however, the contracts were renegotiated. The new contracts increased the tipping fee fourfold, to $42 a ton. The municipalities agreed to sacrifice in the short-term and pay such a large fee increase for two reasons: to finance essential capital improvements to the plant to help it run more efficiently; and to ensure a stable tipping fee over the life of the contract. In addition, the new contracts not only required each municipality to deliver a specified amount of waste, but they included a kind of aggregate put-or-pay provision which allows the PERC facility to void the existing contracts if the total amount of waste from all member communities declines below a specified minimum tonnage. Finally, the new contracts provided that the cities and towns that signed would receive 50 percent of any distributable profits earned by the plant. After signing the contracts, some of the larger cities in this region of Maine like Waterville, and Bangor--cities that have a council form of government--enacted flow control ordinances to ensure that they could deliver the minimum amount of waste specified in the contract. But most of the 160 towns are very small, and they rely on town meetings for public decisionmaking. As anyone familiar with the town meeting form of government knows, the meetings are held infrequently, and the towns generally do not vote on measures unless they must be addressed at that particular time. Consequently, after signing the put-or-pay contracts, a lot of the Maine towns deferred passage of flow control ordinances in the hope that they could deliver the required amount of waste without having to go through the process of formally enacting a flow control ordinance. But these towns always believed that, if necessary, they could resort to flow control to guarantee delivery of the amount of waste specified in their contracts. If they had known that flow control would not be an option, most, if not all, of them would not have signed these contracts. The Carbone decision eliminated the flow control option, changing the rules in the middle of the game, and leaving these communities vulnerable to significant financial hardship if they being to have trouble delivering the amount of waste required in their contracts. Without flow control, these towns may not only find it more difficult to meet their individual contractual obligations, however. They could fail to meet their aggregate tonnage requirements as well, giving PERC's owners the right to void all 160 of the contracts and to initiate a new round of negotiations. The current contract provide stable tipping fees and terms for the member municipalities. And it allows them to receive half the profits generated by the facility--which is only reasonable since the communities have paid for necessary capital improvements through the higher tipping fees negotiated in 1989 and 1990. These cities and towns cannot afford to lose this arrangement. Because they are dispersed across a large, rural region, and because nearly all of the local landfills have had to close due to Federal and State mandates, the PERC waste-to-energy plant is the only real waste disposal option for most of the 160 towns. Under a renegotiation, these towns, tucked away in the far northeastern corner of the United States, will find themselves facing what amounts to a waste disposal monopoly. Needless to say, in such a weak negotiating position, the towns could see their waste disposal costs rise sharply, despite having already invested so much money to make the plant viable. And they could lose the opportunity to get a return on the substantial investment that they made in this facility through the higher tipping fees negotiated in 1990. Mr. President, this elaborate but workable waste disposal system for central, northern, and eastern Maine was predicated on the understanding that flow control would be available to all participating communities. Since flow control was overturned by Carbone, the communities of the region have been placed in a very vulnerable position, one which they would not have placed themselves in had flow control not been an option. In order to avoid substantial financial hardship in the future, put- or-pay communities that signed contracts before Carbone must retain the authority to enact flow control ordinances if they need to. The net effect of the Carbone decision on these communities is not dramatically different from the decision's effect on other communities that actually issued bonds for their own facilities. In both cases, a court decision leaves the communities dangerously exposed to financial hardship. In both cases, the communities designed new waste systems in response to Federal and State policies that encouraged them to do so. And in both cases, the systems were predicated on access to flow control. Considering these similarities, the put-or-pay communities do not deserve to be treated differently and excluded from the flow control grandfather in S. 534. The amendment offered by Senator Cohen and I simply clarifies that the term ``legally binding provision'' in title II, subsection (b) of the bill, includes put-or-pay agreements of the kind negotiated in Maine. As a result of this clarification, the municipalities that have contracted with the PERC facility will continue to have access to flow control, and their intricate but successful waste management system will remain intact. I am very pleased that the managers of the bill agreed to accept this important amendment. Mr. President, with these amendments, S. 534 treats all deserving municipalities equitably, without creating loopholes for other municipalities that did not rely on flow control before the Carbone decision. The bill as amended restores fairness for local governments that acted and invested in good faith, according to the rules that existed before May 15, 1994, Senators Chafee, Smith, Baucus, and Lautenberg deserve credit for crafting a reasonable and balanced compromise bill, and I am happy to announce my support for it.

Ms. SNOWE

Ms. SNOWE. Mr. President, I ask unanimous consent to set aside the pending Wellstone amendment.

Ms. SNOWE. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

Ms. SNOWE. Mr. President, I send an amendment to the desk.

Ms. SNOWE. Thank you, Mr. President. This legislation, unlike any other we have debated this year, touches each and every one of our daily lives. It touches our society as few bills do. In our homes. In our schoolrooms, In our work rooms. And in our hospital rooms. There is a compelling case for product liability reform in this country, and this bill provides for a positive foundation on which we can build in the future. It may not be the end-all to the liability reform debate. And it is not a panacea to the legal labyrinth that millions of Americans have found themselves caught in at some time in their lives. But it is a critical and long overdue first step in the process. Mr. President, many Americans may ask a very simple question as we begin this debate, and that is this: In this time of downsizing Government and devolving power back to the States, why do we need Federal legislation on product liability? It is a good question that merits a good answer. The problem involves a vast patchwork of product liability laws in 50 States and the District of Columbia that send confusing and often conflicting signals to those who make, sell, or use products in the United States. Moreover, it is the uncertainty of this product liability system that creates unnecessary legal costs, impedes interstate commerce, and stifles innovation. And it unnecessarily places consumers--those we are trying to protect--at risk. Despite recent product liability reforms in various States around the country, there is still an overriding and strong need for a protective, uniform, and all-encompassing Federal product liability law. The problem with State product liability legislation--apart from the simple fact that different States have different rules--is that State legislation cannot capture or control the product liability problem outside its own borders. Every suit filed and every judgment rendered has a potential impact on every other consumer in America by leading to possible changes in the product itself, increasing the item's price, and potentially affecting the price and availability of a wide range of other products. In extreme cases, manufacturers may even cease production of some products. Even States in which product liability lawsuits are infrequent and judgments have been deemed appropriate are not immune from the impact of disparate State laws. I am proud to say that in my home State of Maine, it has been said that our jury verdicts have been reasonable and our judges fair. But the effect of the judgment in one State is shouldered by the consumers of that product in every other State. Therefore, the State of Maine residents pay a premium on every product they buy that has come in from outside the State of Maine--and on every product they buy from a local company that also distributes outside our State's borders. The simple fact is that the residents of Maine are impacted by the product liability laws of every other State. And just as States cannot single-handedly address the problems caused by our spiraling national debt, they cannot address the national product liability problem. I have come to the conclusion that a Federal product liability law is the only mechanism to assure that a fair and uniform law will apply evenly throughout the United States. I also recognize the role that uniformity plays in protecting the common good in certain circumstances. Civil rights laws and many environmental laws reflect the understanding that serving the common good may be best accomplished by maintaining similar standards across State borders. Not every issue affecting both States warrants a Federal standard, but some issues are pervasive enough--significant enough-- that we cannot help but recognize the need for some level of agreement. Mr. President, as a member of the Commerce Committee, I certainly have stressed the need for balance in this legislation and I offer my own personal check-list of the issues this legislation must address so that it is fair and equitable. First, we must allow safe consumer products to be developed to meet consumer needs, and ensure that consumers can seek reasonable compensation when injuries and damages occur. Second, the law must dissuade consumers from filing lawsuits frivolously, without discouraging Americans with substantive complaints from filing their own suit. Third, a uniform law must encourage companies to police the safety of their own products, both by offering incentives for excellence in safety and strong punishment when product safety is breached. Lastly, and perhaps most importantly, one of our fundamental goals must be to ensure this legislation protects the interests of the average American consumer who makes hefty use of products, but knows little of their innate safety or risk--much less their rights under the law. Although I believe the call for product liability reform is justified, I certainly understand the concerns of those who testified before the committee regarding the potential discriminatory impact of this bill--particularly the dual standards created within the cap on punitive damages. To understand the issue of a punitive damage cap, I think it is valuable to remember what punitive damages are--and are not. Punitive damages are punishment that serve an invaluable role in deterring quasi-criminal behavior by businesses. They have nothing to do with providing compensation to a person who has been harmed and are not intended in any way to make the plaintiff whole. That purpose is served by compensatory damages, which provide recovery for both economic damages--which include lost wages and medical expenses--and noneconomic damages, which include pain and suffering and other losses. would contain runaway juries by capping punitive damages. One of the overriding problems in our current system is the absence of any consistent, meaningful standards for determining whether punitive damages should be awarded and--if so--in what amounts. The absence of consistent standards not only leads to widely disparate and runaway punitive awards, but it also affects the settlement process. Individuals and companies that are used often face a catch-22: pay high legal fees to fight a case through trial, verdict, and appeal--or simply settle out of court for any amount less than these anticipated legal fees. Even for the defendant who recognizes the cost of proving innocence to be too great, or simply hopes to avoid the lottery nature of a possible punitive award--seeking a settlement carries a hidden cost. The lack of a uniform national standard--or simply the existence of vague State standards--forces the defendant to include a punitive premium in their settlements, even when the likelihood of a punitive award is small or even nonexistent. The high reversal rate of punitive damage awards underscores the absence of clear and understandable rules. Moreover, appealing the initial award is extremely costly and unnecessarily wasteful of both private and judicial resources. Although businesses and related entities pay the initial price of punitive awards, the impact of runaway awards is felt by consumers who pay higher prices in goods and services. And health care is not different. Malpractice is an issue that should concern every American because it directly impacts the amount of money they pay for health care and their access to care. A 1993 Lewin-VHI study estimates that the combined cost of physician and hospital defensive medicine to be as high as $25 billion. And the 1994 Physician Payment Review Commission Annual Report to Congress noted a ``widespread concern that the current functioning of the malpractice system may promote the practice of defensive medicine and impeded efforts to improve the appropriateness and cost effectiveness of care.'' Access to quality care was an issue that received a great deal of attention--as well it should--over the last 2 years as Congress looked at ways to reform our health care system. The cost of malpractice has a direct impact on access to care, especially for women. A 1990 survey found that liability concerns caused 12 percent of doctors to give up their obstetrical practices, 24 percent to reduce their treatment of high-risk patients, and 10 percent to reduce their number of deliveries. Concern has been expressed this afternoon during the debate that this is a matter that should be left up to the individual States. But the American taxpayers from Maine to Oregon have a direct stake in malpractice reform because the U.S. Government--in other words the American taxpayer--pays 32 percent of all the health care costs in this country. They are already paying a heavy price for the patchwork system of malpractice laws that currently exist and they deserve our best effort to provide a uniform standard that will help bring down the cost of health care and help ensure access to providers. As we establish a cap, it is vital that we ensure the measure we choose is fair, uniform, acts as adequate punishment, and serves as an effective deterrent. I believe the amendment I have offered accomplishes all of these objectives. I should mention that Senator Gorton, the primary sponsor of this legislation, has indicated that he will certainly support my amendment. And I thank the underlying sponsors, Senator McConnell and Senator Kassebaum, for their support as well for this amendment. My amendment is fair because it is blind to the socioeconomic position of the plaintiff. The current cap contained in the McConnell amendment would cap punitive damages at the greater of $250,000 or three times economic damages. Economic damages--again--are the out-of-pocket expenses incurred by the plaintiff, such as their lost wages and medical expenses. Although this measure might serve as adequate punishment and act as an adequate deterrent in many cases, it relies too greatly on the economic position of the plaintiff in establishing a sufficient level of punishment. I believe that all plaintiffs--regardless of their income--must be in a position to levy adequate punishment on those medical providers who have performed a particularly egregious act. We must not allow a medical provider to suffer only a slap on the wrist because his conduct harmed an individual of modest means. As a very basic example, assume that two individuals--a truck driver with an annual income of $24,000 and one a corporate executive with an annual income of $1.2 million--suffer from similar medical malpractice injuries from two separate defendants and are each hospitalized for 1 month due to these injuries. Further assume that the medical expenses for these individuals are nearly identical at $100,000--an amount I am sure is far too low. Under the three times economic damages formula, the potential punitive damage award--or punishment--that could be levied in the suit involving the millionaire would be up to approximately $600,000. This would be derived by adding the individual's lost income--$100,000--with his or her medical expenses--$100,000--and multiplying by three. Conversely, the defendant in the lawsuit involving the truck driver could only be subjected to punitive damages of up to $306,000--or 51 percent that of the millionaire's defendant. This amount is derived by trebling the sum of the plaintiff's lost wages--$2,000--and medical expenses $100,000. Although some would argue that the lower cap imposed in the suit involving the truck driver may serve as sufficient punishment, I believe it is fundamentally unfair. If the language of my amendment is adopted, the potential punitive award in the suit involving the truck driver will be far more in line with that of the millionaire. By including noneconomic damages--which are less tangible and include pain and suffering and the loss of one's eye, hand, or other faculty--the discriminatory effect of the cap will also be removed. Continuing with the example already described, let us further assume that the jury award for noneconomic damages caused by the loss of one of the plaintiff's eyes is $500,000 for both the millionaire and the truck driver. Using the two times compensatory measure, the possible punitive award would be $1.2 million for the millionaire and $1.004 million for the truck driver. In this way, the possible punitive award that could be imposed is nearly identical in both cases as the cap for the truck driver is 84 percent the size of the millionaire's cap. Although hard statistics on this issue are difficult to find, the 1989 General Accounting Office report on product liability found that there was a strong correlation between the size of punitive awards and the size of compensatory damages. Excluding one extreme case in which compensatory damages far exceeded punitive damages, the punitive damages had a correlation of 0.71 with compensatory damages--which is just shy of a one-to-one ratio. Although each of the five States contained in the study had varying levels of correlation, this average demonstrates that a reasonable cap based on compensatory damages can be drafted. The Supreme Court has also expressed its concern with the manner in which punitive damages have been awarded--and lends credence to the argument in favor of a uniform cap. In the case of Pacific Mutual Life Insurance Company versus Haslip, the Supreme Court found that a four- to-one ratio of compensatory to punitive damages was ``close to the line'' of being unconstitutional, and expressed a strong concern that punitive damages in the United States have ``run wild.'' Similar sentiments were expressed in TXO Production Corp. versus Alliance Resources Corp., a case involving a commercial land dispute. In both cases, Justices made clear that this was an area for reasonable and rational reform. Although no clear standard was identified, I believe the measure of two times compensatory damages would be deemed appropriate by the Supreme Court. [ACTL]--a respected organization of experienced plaintiff and defense attorneys--recommended a cap based on a two times compensatory damages in their 1989 report on punitive damages. The ACTL report also recommended that the two times compensatory damage cap be combined with a minimum cap of $250,000, but I do not believe such a measure is advisable or necessary. I believe a single measure--such as the measure contained in my amendment--is the most easily understood and ensures that all relevant cases are subject to the same standard. Multiple measures and standards imply that there is an imbalance in the formula being utilized. I believe the measure of two times compensatory damages will work for everyone and will subject egregious offenders to strong punishment. This standard is fair and nondiscriminatory. It will apply to all litigants equally--whether you are a man or woman, wealthy or poor, a child or an adult. Mr. President, if we have to include a cap on punitive damages in this legislation, we must ensure it is the best cap possible. So I ask my colleagues to join me in support of this amendment to the McConnell amendment today, and during further consideration of the underlying bill next week, because I do intend to offer this very same amendment to the underlying legislation as well. I think the legislation, which is named the Product Liability Fairness Act, must live up to its name and therefore I think that my amendment will correct this discriminatory impact of punitive damages as it is currently drafted in this amendment as well as the underlying bill. I believe my amendment is the best alternative available and I encourage my colleagues to support it.

Ms. SNOWE

Ms. SNOWE. Mr. President, today I am submitting a resolution calling for the end of the long-standing dispute on Cyprus. I am pleased to be joined as original cosponsors by my distinguished colleagues, Senators Simon, Pressler, Sarbanes, D'Amato, and Dodd. Mr. President, last year marked the 20th anniversary of the Turkish invasion of Cyprus. Year after year the political deadlock over Cyprus has endured. But elsewhere in the world these same two decades has seen the end to the Soviet Union, mutual recognition between Israel and the PLO, a peaceful transition to majority rule in South Africa, and a renunciation of terrorism by the Irish Republican Army and movement toward an enduring peace in Northern Ireland. It is long past time for a similar breakthrough for peace on Cyprus. That is the purpose of this resolution. This resolution speaks with moderation with the hope of bringing together all sides to the conflict. But despite its moderate tones, the resolution calls for looking at the problem of Cyprus in a radically new way. The resolution: declares the status quo on Cyprus to be unacceptable; welcomes President Clinton's appointment of a special emissary for Cyprus; calls on all parties to seek a solution based on the U.N. Security Council resolution of based on a single State of Cyprus with its independence and territorial integrity safeguarded; calls for the withdrawal of all foreign troops; states that proposals for a total demilitarization of Cyprus would enhance the security of all the Cypriot people and merits support; and urges the Security Council and the United States Government to consider alternative approaches to promote a resolution to the long-standing dispute, including incentives to encourage progress or sanctions against recalcitrant parties. Mr. President, two decades ago, Turkey's brutal invasion drove more than 200,000 Cypriots from their homes and reduced them to the status of refugees in their own land. More than 2,000 people are still missing, including five American citizens. The Turkish Army seized 40 percent of the land of Cyprus, representing 70 percent of the island's economic wealth. Today, Turkey continues to maintain over 35,000 troops on the island, which forms the bedrock of the continuing political impasse. The phrase ``35,000 Turkish troops'' may sound familiar, because this is the number of troops Turkey has used, with tragic sameness, in its invasion last month of U.N.-protected Kurdish areas of northern Iraq. For the benefit of the Kurdish people of Iraq, who have been subject to genocidal attacks by their own government, I only hope that they will not suffer the same fate as the people of Cyprus. On Cyprus, Turkey initially pledged to stay only for a brief time to protect the Turkish- Cypriot minority on Cyprus. Now, we are beginning the third decade of Turkish occupation. In an effort to transform this paradigm of deadlock, last year Cypriot President Glafcos Clerides offered to totally demilitarize the island of Cyprus in the context of a Turkish military withdrawal and political agreement to reunify the country. The Government of Cyprus, then, has volunteered to entirely disband its military forces, giving up this fundamental sovereign attribute for the purpose of peace. The need to transform the terms of the debate over Cyprus is self evident for all who choose to see. I was first elected to the House in 1978, 4 years after the Turkish invasion. That was the same year that President Carter succeeded in getting the United States arms embargo on Turkey lifted on the promise of an imminent breakthrough on ending the tragic and illegal division of the island. Every year I have been in Congress I have noted a sad, cynical process unfold. Each year, there are hints of movement and glimmering hopes of ending the Turkish occupation and reuniting Cyprus. The most recent opportunity has been the U.N.-sponsored talks over ``Confidence Building Measures,'' which would certainly be constructive if the talks had been undertaken in good faith by all sides and if they could set the stage for moving rapidly toward a final resolution of the dispute. But neither has been the case, so the talks ultimately atrophied into endless discussions and disagreements over the same kind of modest half-measures that have been the subject of endless talk ever since 1974. Mr. President, we must continue to press for a negotiated settlement to the illegal division of Cyprus, and we must neither accept nor become comfortable with the status quo. This resolution is moderate in tone, and refrains from laying blame on any party. I believe that all parties can and must take a new look at the problem of Cyprus and work in good faith to bring this tragedy to an end. But as this resolution makes clear, our Nation must also be prepared to work alone or through the Security Council to ensure that all parties also understand that a continued impasse on Cyprus will not be tolerated.

Ms. SNOWE

Ms. SNOWE. Mr. President, I thank the Senator for yielding. I am pleased to be able to join my freshman colleagues in talking about the agenda for the coming weeks and months as we return from our spring recess and have the opportunity to discuss with our constituents exactly what is on their minds. I can assure you, it is the same thing that it was in November. People are still clamoring for institutional, economic, and political change. that we have already made in the first 100 days, many of the issues that have laid dormant in this institution for years and years, have been acted upon, such as requiring Congress to live by the same rules that apply to the rest of society, stopping the tide of unfunded mandates, and giving the President line-item veto authority. So we have made progress. But they want to continue our assault on the status quo. I cannot think of a better way to demonstrate our commitment to changing the status quo than to show the American people that deficit reduction and balancing the Federal budget is going to be on the top of our agenda. I know that many people have said here on the floor of the Senate when we were debating a constitutional amendment to balance the budget that we do not need a constitutional amendment, that it is not necessary. Unfortunately, history has just disproved us in that regard because we have had a fiscal losing streak with 26 years of unbalanced budgets. Mr. President, 1969 is the last time in which we had a balanced Federal budget. I hope that we can disprove history. I hope that we are able as we meet this week in the Senate Budget Committee on Thursday to begin the process of marking up the budget resolution that we will engage in a bipartisan effort to balance the Federal budget. Our goal is to put our budget on a glidepath toward balancing it by the year 2002. So I hope all who have mentioned that we do not need a constitutional amendment will join us in that effort to ensure that we will in fact have a statutory commitment toward the balancing of the Federal budget. The administration unfortunately has perpetuated the fiscal status quo with a budget that was submitted by the President several months ago. In fact, back in 1992 the President said he would offer a 5-year budget plan that would balance the Federal budget. He has not done that. He then said that he would reduce the Federal budget deficit by half by 1996. Of course, that has not occurred. Instead, we received a budget that only eliminates one agency, the Interstate Commerce Commission, out of a grand total of a budget of $1.2 trillion. In fact, the Congressional Budget Office reestimated the administration's projections on deficits. And it is quite alarming as well as disturbing when you see the upward trend of the deficits as well as the interest payments. That is what makes our action on the budget deficit and balancing the Federal budget so compelling. According to the CBO, the 1996 deficit will be $211 billion, not the $197 billion projected by the administration. The 1998 deficit will rise to $231 billion, not the $196 billion projected by the administration. In 1999, the deficit will reach an estimated $256 billion, far from the $197 billion the administration had forecasted. Finally, in the fiscal year 2000, the Congressional Budget Office said the deficit will reach $276 billion rather than the $194 billion the administration has projected. It means according to CBO reestimates that the size of our national deficit over the next 5 years will increase by 55 percent. It will grow from 2.5 percent of the gross domestic product to 3.1 percent of the GDP, which is contrary to what the administration had indicated, that in fact they had said that the deficit would be 2.5 percent of GDP and decline to 2.1 percent of GDP. Obviously, that is not now the reality. The gap between the administration's projections on the deficits and the Congressional Budget Office really amounts to more than $209 billion that will be spent over the next 5 years; $209 billion. It is incredible when you consider the fact that by the year 2000 we will in fact have had our revenues exceed the 1995 revenues by $323 billion. So you would say then we must have a much smaller deficit in the fiscal year 2000. Well, no. We are not going to. We are going to have a deficit of $273 billion. It will be $100 billion more than it will be in 1995, even though we will have $323 billion more in additional revenue. We will be spending $422 billion over the next 5 years. That represents a 28-percent increase during a time when inflation is projected to rise by half that rate. The administration said it is going to cut the budget over the next 5 years by $144 billion. In fact, it is being reestimated by the Congressional Budget Office. In fact, the administration's budget will only reduce Federal spending by $32 billion over the next 5 years, meaning just about $6 billion a year, thirty-nine one-hundredths of 1 percent of total Federal spending, hardly enough, and certainly is not going to put us on a stable fiscal path for the future. And that is what we are talking about, the future for this country because deficits are affecting not only taxes but productivity, savings, the deficit, and employment. It affects all of those categories. We need to be investing in the future. Otherwise, we are going to create a second- rate economy. That certainly is not exaggerated because 1969, the last time the Federal Government had a balanced Federal budget, the dollar traded for 4 German marks and 360 Japanese yen. And, since then, while the Federal debt has increased by 1250 percent, or $4.5 trillion, the dollar has lost two-thirds of its value against the mark, and three-fourths against the yen. I guess in reality what we are saying is that it will continue to cost the American people millions, if not billions, of dollars because the link between a lackluster and unfocused and uncontrolled Federal budget policy and a decline of the dollar is indisputable. In fact, the Federal Reserve Chairman, Alan Greenspan, told the House Budget Committee recently that all told a Federal program of fiscal restraint that moves the deficit finances to sounder footing almost surely will find a favorable reception in financial markets. He added that a key element in dealing with the dollar's weakness is to address our underlying fiscal balance. In layman's terms that means only one thing. It means balancing the Federal budget. So I hope we can work in unison on a Republican and Democratic basis and in conjunction with the administration to produce just that, a balanced Federal budget, not only for this generation but future generations to come. Mr. President, I yield the floor.

Ms. SNOWE

Ms. SNOWE. Mr. President, today I am introducing legislation that will impose a 1-year moratorium on sanctions under the Clean Air Act for States that have marginal or moderate nonattainment areas within their borders. All across the country, from Maine to Texas, citizens are voicing their dissatisfaction with some of the requirements of the Clean Air Act Amendments of 1990. In particular, they are objecting to the imposition of enhanced vehicle inspection and maintenance programs. Many governors, frustrated over the difficulty of implementing this and other measures mandated by the act, have joined in this chorus of dissatisfaction and discontent, and have petitioned the Environmental Protection Agency for flexibility and assistance in meeting the act's requirement. Neither the people nor the Governors question the act's goals--clean and healthy air for everyone. But they do question the equity and reasonableness of the way that the act has been implemented to date. In response to the widespread criticisms, the Administrator of EPA, Carol Browner, announced late last year that the Agency would provide the States with the greatest possible flexibility in implementing the act. She singled the enhanced inspection and maintenance program out for special mention, stating that EPA would review alternatives to a centralized enhanced I&M program, which had been required initially. Although the EPA deserves credit for making a commitment to greater flexibility, much uncertainty and trepidation regarding the act's requirements remains. Maine provides a stark example of the serious problems that still exist and that must be addressed. My home State led the Nation in implementing the enhanced inspection and maintenance program. Maine began its program 6 months ahead of time, on July 1, 1994, to avoid situations in which motorists might face long lines or technical problems at testing facilities in the middle of winter. The program was beset with problems almost before it began, with motorists complaining about long lines, inconsistent test results, and ill-informed attendants. In combination with serious concerns about potential repair costs, and legitimate questions about the need for such extensive tests in a small, sparsely populated State, these problems created a swell of popular opposition to the program. By September, the State legislature and the Governor decided to suspend implementation of the program until March 1, 1995. People in other States facing the enhanced I&M requirements, hearing about the problems with Maine's program, and realizing what the enhanced program would require of them, began to express concerns as well. Their elected officials at the State and Federal levels relayed there concerns to the EPA. In response to the many criticisms coming from States across the country, EPA made its December announcement on alternatives and flexibility. Unfortunately, since that time, little has been settled. There is great confusion in Maine, and probably other States, about exactly what will be required of them, especially with regard to ozone nonattainment. Not only is it unclear what kind of emissions testing program will be acceptable, but questions persist about whether states subject to significant transported polluted air will be able to account for this transported air in their plans to attain the federal ozone standard. Maine sits at the tail and of the Northeast ozone transport region, which includes the 11 Northeastern States and the District of Columbia. No area in the State is classified higher than moderate nonattainment. But under the Clean Air Act, Maine is required to reduce volatile organic compounds by 15 percent in all of these areas. Given the uncertainty and confusion surrounding emissions inspection and the act's requirements for ozone in general, the State has not yet adopted its 15 percent reduction plan, and it faces a statutory deadline of July 26, 1995. After that date, EPA is required by law to impose stiff sanctions, either withholding highway construction funds, or imposing a strict 2-to-1 offset requirement for new sources of emissions. With the threat of painful sanctions weighing heavily over their heads, the Governor and the Maine Legislature are scrambling to devise a VOC reduction plan and an alternative I&M program. But people in Maine are understandably reluctant to move forward with expensive and complicated emissions reductions measures if a significant amount of the air that accounts for the nonattainment classification is transported in from outside state boundaries. Yet, the data that could determine the amount of transported pollution is unavailable at the present time. Maine is caught between a rock and a hard place. If it moves forward, it could impose burdensome requirements on its citizens without knowing the full extent to which they contribute to the pollution in Maine. If they do not proceed by July 26, the EPA will be forced to levy serious penalties. And they do not know, in precise terms, what is acceptable to EPA now, and what will be acceptable 6 months from now. Maine faces similar uncertainty with regard to enhanced emissions inspection and maintenance programs. Because Maine is included in the Northeast ozone transport region, the act mandates that, at a minimum, the cities of Portland and Kittery implement the enhanced emissions testing program that has generated intense controversy in Maine and other States across the country. My legislation protects States from sanctions related to this requirement as well, provided the area subject to the enhanced I&M requirement has been designated as marginal or moderate nonattainment. Mr. President, I do not believe that States like Maine should be required to develop these sensitive programs under the duress of Federal Sanctions. They should have sufficient time to sort out the new developments on the issue, to collect data on transported air, and to compliance measures. In the absence of a more deliberative process that allows States to carefully analyze all of their options, we could provoke a repeat of last year, when States like Maine tried to implement programs but met stiff public opposition. That kind of scenario will not bring us any closer to cleaner air. States need a temporary break from the sanctions threat, and my bill will provide that break. It establishes a 1-year moratorium on sanctions and penalties related to marginal and moderate ozone nonattainment areas. It applies only to States, and it simply gives the States with these areas a reprieve from the Clean Air Act's heavy- handed sanctions so that they are not forced to act too hastily in what appears to be an evolving regulatory landscape. Mr. President, my bill offers a reasonable approach to a major controversy affecting many States. I think it will advance the cause of clean air by allowing States to develop emissions reductions plans that have some credibility in the eyes of the public. I invite my colleagues from other States facing similar problems to join me in cosponsoring this legislation, and to work with me for prompt passage of it. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Ms. SNOWE

Ms. SNOWE. Mr. President, it is my pleasure today to offer my strong support for legislation to honor our colleague and my predecessor, former Senate Majority Leader George J. Mitchell. This legislation, which I am proud to cosponsor with my colleague, the senior senator from Maine, would designate the Federal building at 33 College Avenue in Waterville, Maine, as the ``George J. Mitchell Federal Building.'' There is perhaps no more fitting tribute to George Mitchell than naming the federal building in his home town--Waterville, Maine--in his honor. George Mitchell is a man who dedicated himself to government. Following his graduation from Georgetown Law School in Washington, George Mitchell devoted himself to public service: at the U.S. Justice Department; as the leader of his party in the State of Maine; as one of Maine's gubernatorial candidates; as a federal, U.S. District judge; and, for the past fourteen years, as Maine's junior senator. George Mitchell devoted himself to government because he believed in government, and it is appropriate today that we name the seat of our federal government in his hometown in his honor. George Mitchell's story is well known in Waterville, Maine. His mother was a first-generation Lebanese immigrant; his father, an orphan, was a janitor at Colby College. They instilled strong values in their son. George Mitchell dedicated himself to learning, to knowledge and justice, and throughout his youth he surpassed the arbitrary ceilings our society so often builds. He graduated from Bowdoin College, served in the Army, and then went on to law school. He typified the Maine work ethic, and that ethic served him well as an attorney, a judge, and as a United States Senator. George Mitchell came to the U.S. Senate when another distinguished Mainer, Senator Edmund Muskie, resigned his seat to become Secretary of State. Immediately, Senator Mitchell put a lifetime of experience to work. He became one of the earliest advocates--and chief sponsors--of the landmark Clean Air legislation that passed a decade later, in 1990. He recognized the importance of standing up for [[Page S5442]] Maine-- and also made his mark on our nation's political system. Because of his dedication to his party's ideals, he was chosen as this body's Majority Leader in 1988, and served in that important and prestigious position until his retirement from the Senate. Always, during his tenure, George Mitchell remembered the people who sent him to Washington. As Maine's Second District Representative, I was honored to serve alongside George Mitchell throughout his tenure in the United States Senate. We worked together on a bipartisan basis to ensure that the men and women of Maine were treated fairly, and had opportunities extended to other Americans. With this legislation, we make an appropriate acknowledgement of George Mitchell's years of leadership in the public arena. This is but a small token of our appreciation: a fitting gesture which the City of Waterville has requested. So in closing, I urge all of my colleagues to join me in support of this legislation and to extend to George Mitchell the hometown honor he so deeply deserves.

Ms. SNOWE

Ms. SNOWE. Mr. President, today I am introducing legislation that would help to preserve historic lighthouses in the State of Maine and ensure that future generations will be able to appreciate these treasured landmarks. The legislation, also known as the Maine Lights Program, authorizes the Secretary of Transportation to convey four lighthouses in Maine to the U.S. Fish and Wildlife Service, and (29) others to the Island Institute of Rockland, ME. Founded in 1983, the Island Institute is a nationally recognized nonprofit organization dedicated to the preservation and protection of Maine's coastal lights. This legislation was crafted in close coordination with the Island Institute, and it is an extraordinary opportunity to preserve the most obvious symbols of Maine's living maritime heritage. The Maine Lights Program is strongly supported by the U.S. Coast Guard. The Coast Guard currently owns each of these lighthouses, and it is a strong proponent of preserving their historic character. But the cost of maintaining these historic structures is becoming particularly difficult for the Coast Guard in these times of tight budgetary constraints. These lighthouses were built in an age when they had to be manned continuously. Today's advanced technology has made it possible to build automated aids to navigation that do not require around-the- clock manning, and this technology has made these historic lighthouses expensive anachronisms for the Coast Guard. The Maine Lights Program would relieve the Coast Guard of the financial burden of maintaining these lighthouses. The program also mandates continued Coast Guard maintenance of the active aids to navigation in these lighthouses--the lights and horns-- and it ensures that each lighthouse will remain an effective marine navigational aid despite the conveyance. Maritime safety will not be sacrificed in the name of saving money. The Coast Guard will still be responsible for maintaining the aids to navigation themselves. Only the lighthouses and structures associated with them are impacted by this program. By conveying these lighthouses to the Island Institute, the program ensures that the lighthouses will be preserved as an important part of our coastal maritime heritage. The Island Institute will never be allowed to sell these properties. The institute would be required to transfer the lighthouses to third parties without any compensation to itself within a 3-year period beginning on the date of the conveyance of the lighthouse to the institute by the Coast Guard. The Island Institute would be required to identify appropriate nonprofit corporations, educational agencies, community development organizations, and any Federal, State, or local government or other eligible entity that would assume responsibility for the lighthouse. This legislation sets specific eligibility requirements for organizations and entities that wish to take the responsibility of a lighthouse. They must be financially able to maintain the lighthouse, and they must agree to regular inspections by the State historic preservation officer of the State of Maine in order to ensure that the lighthouses are being properly maintained in a manner that preserves their historic characteristics. Moreover, those receiving a lighthouse must also assure continued public access to the lighthouse. This legislation also provides that if the Secretary of Transportation determined at any time that a lighthouse is not being used or maintained as required by the law, that the lighthouse would revert to the United States and then be transferred to other institutions or entities according to existing law. Finally, the legislation requires the Secretary to report to Congress after 5 years about the effectiveness of the program in maintaining, preserving, and repairing historic lighthouse properties, maintaining public access, and finding and transferring lighthouse property to appropriate third parties. The Island Institute has already identified suitable candidates for receiving many of these lighthouses. For example, the town of Camden will receive the Curtis Island Light, which is located in Camden Harbor. The town already owns Curtis Island and all of the buildings on it except for the light tower itself, and this program will appropriately convey the light tower to the town of Camden. The Maine Lights Program is an innovative approach to historic maritime preservation. It will become a model for the conveyance of other lighthouses for historic preservation all across the country. At the same time it will save the Coast Guard hundreds of thousands, if not millions, of dollars a year in maintenance costs. I urge all of my colleagues to support this legislation, and I ask unanimous consent that the text of the legislation be printed in the Record.

Ms. SNOWE

Ms. SNOWE. I thank the Senator. I certainly want to be on record in support of this most important program to so many people in my State, and certainly in the Northeast. I was part of an effort back in 1980 in the House of Representatives to create this program. Yes, it was in response, originally, to a crisis. That is not unusual for the number of programs that are created in the U.S. Congress. But Congress intended it to be a long-term program, because it was serving the poorest of the poor. It is a means- tested program. It serves a number of people. Yet, it only serves 25 percent of those individuals who are actually eligible to receive benefits under this program. This program, in real terms, has been reduced by 50 percent since 1985--50 percent. I know the Senator from Arizona was referring to the President's budget last year of $700 million, and that even the President was recommending a 50 percent reduction. He recommended that reduction because he wanted to remove the Southern States from that program. In fact, in 1994, the President recommended a supplemental increase for the low-income fuel assistance program of more than $300 million, which I think demonstrates the President's commitment to this program. But who does this program serve? Of the roughly 5.6 million households that receive low-income fuel assistance, more than two- thirds have annual incomes of less than $8,000. More than one-half have had incomes below $6,000. Thirty percent of these recipients are poor, elderly people, and 20 percent are disabled. In my home State, 74 percent of these recipients are elderly people on fixed incomes. We are supporting people who need to have the benefits of this very valuable program.

Ms. SNOWE

Ms. SNOWE. Mr. President, I am proud to join Senators Hatch, Heflin, and others in cosponsoring the proposed constitutional amendment to grant to States and Congress the power to prohibit the physical desecration of the flag of the United States. Our flag occupies a truly unique place in the hearts of millions of citizens as a cherished symbol of freedom and democracy. As a national emblem of the world's greatest democracy, the American flag should be treated with respect and care. Our free speech rights do not entitle us to simply consider the flag as personal property, which can be treated any way we see fit including physically desecrating it as a legitimate form of political protest. The flag is not just simply a visual symbol to us--it is a symbol whose pattern and colors tell a story that rings true for each and every American. The 50 stars and 13 stripes on the flag are a reminder that our Nation is built on the unity and harmony of 50 States. And the colors of our flag were not chosen randomly: red was selected because it represents courage, bravery, and the willingness of the American people to give their life for their country and its principles of freedom and democracy; white was selected because it represents integrity and purity; and blue because it represents vigilance, perseverance, and justice. Thus, this flag has become a source of inspiration to every American wherever it is displayed. For these reasons and many others, a great majority of Americans believe--as I strongly do--that the American flag should be treated with dignity, respect, and care--and nothing less. Unfortunately, not everyone shares this view. In June 1990, the Supreme Court ruled that the Flag Protection Act of 1989, legislation adopted by the Congress in 1989 generally prohibiting physical defilement or desecration of the flag, was unconstitutional. This decision, a 5-to-4 ruling in U.S. versus Eichman, held that burning the flag as a political protest was constitutionally protected free speech. The Flag Protection Act had originally been adopted by the 101st Congress after the Supreme Court ruled in its Texas versus Johnson case that existing Federal and State laws prohibiting flag burning were unconstitutional because they violated the first amendment's provisions regarding free speech. I profoundly disagreed with both rulings the Supreme Court made on this issue. In our modern society, there are still many different forums in our mass media, television, newspapers and radio and the like, through which citizens can freely and fully exercise their legitimate, constitutional right to free speech, even if what they have to say is overwhelmingly unpopular with a majority of American citizens. The constitutional amendment being introduced today has been carefully drafted to simply allow the Congress and individual State legislatures to enact laws prohibiting the physical desecration of the flag, if they so choose. It certainly does not stipulate or require that such laws be enacted. When considering the issue, it is helpful to remember that prior to the Supreme Court's 1989 Texas versus Johnson ruling, 48 States, including my own State of Maine, and the Federal Government had anti-flag-burning laws on their books for years. Whether our flag is flying over a ball park, a military base, a school, or on a flag pole on Main Street, our national standard has always represented the ideals and values that are the foundation this great nation was built on. And our flag has come not only to represent the glories of our Nation's past, but it has also come to stand as a symbol for hope for our Nation's future. Mr. President, I urge my colleagues to support this important amendment.

Ms. SNOWE

Ms. SNOWE. Mr. President, as we all know, a couple weeks ago, we lost the balanced budget amendment by one vote. We turned back the tide of change that was pushed forward by the people of this country in the last election. That vote truly prevented us from changing the economic course of this entire Nation. Fortunately, and hopefully, we will have another vote on that issue at some point in the future. But, until that time, we have a moral obligation and, I believe, an economic responsibility, to continue the fight against increased deficits and a ballooning national debt. We in the Senate must take up that fight because it is obvious that the President and his administration have abdicated all fiscal responsibility and interest in ending the economic status quo. We just have to look at the latest budget proposal offered by the administration for fiscal year 1996. We still have $200 billion in annual deficits. We cannot allow them to be acceptable commodities for the future. We have a $4.8 trillion debt and we can expect, with the administration's projected budget for the next few years, that the budgets will add another $1.3 or $1.5 trillion in addition to the national debt. We have $200 billion currently in interest payments each year. That certainly is something that needs to be addressed. If you look at the President's budget estimates and what has been reestimated by the Congressional Budget Office, it is interesting, in the March 8 CBO report, they reestimated the administration's deficits, because they were underestimated, over the next 5 years, by between $14 to $82 billion, for a total of $209 billion. In 1996, they underestimate the deficit by $14 billion; in 1997, by $18 billion; in 1998, $34.6 billion; in 1999, $58.6 billion; in 2000, $81.6 billion. That is what we are addressing over the next few years. So while we have lost the balanced budget amendment--at least for the time being--I hope then that we can consider and pass the line-item veto. The line-item veto is an idea whose time has come. In reality, the line-item veto is an idea whose time came, went, and now has come back. In 1974, the Congress passed the Impoundment Control Act which, among other things, stripped the President of the power to impound specific and often wasteful spending programs from the Federal budget. It was a right our Chief Executive had been afforded already for almost 200 years. Perhaps not coincidentally, 1974 marked the year that truly ushered in the era of perpetually unbalanced Federal budgets and established one of Congress' worst fiscal losing streaks: 26 straight years of unbalanced budgets and mounting national debt. While the retention of Presidential impoundment powers in 1974 may not have prevented a $4.8 trillion debt, it may have helped decrease part of the more than $4 trillion that has been added to our debt since that period of time. The line-item veto is another critical tool to help us reach our goals and to put us on the path toward fiscal responsibility, and America needs it now more than ever before. I would like to first commend the sponsors of this bill for their tireless work and for their ongoing commitment to eradicating waste and unnecessary spending from the Federal budget. The Senator from Arizona [Mr. McCain] has argued the merits of a line-item veto for the past 7 years, since his election to the Senate. He has been ably joined by the Senator from Indiana [Mr. Coats], whose record on fiscal responsibility is one of the best in this Chamber. I think the majority leader deserves credit for his role in bringing this legislation to the floor. I am a cosponsor of the legislation, the original draft of S. 4, that provides for a line-item veto. I must admit in this debate that, unlike my colleagues from Kansas, Arizona, and Indiana, I am a newer convert to the merits of the line- item veto, so I understand the concerns and feelings of those who may be reluctant and reticent to support a Presidential line-item veto. But I have come to the conclusion that it is necessary, over the last few years, to support this legislation because we have been unable to enforce the kind of discipline necessary to control Federal spending. I do not believe that any of us think that the decisions will be easy, but they never have been for any American generation pushing for positive change in our country. As one poet said, ``Change is not made without inconvenience, even from worse to better.'' Despite these inconveniences, we must make a clean and swift break from the failed policies of the past--especially in our budgeting process. in the words of Thomas Schatz, president of Citizens Against Government Waste, ``The first step is to reverse old assumptions. Congress has often viewed programs as perpetual, without taking enough time to evaluate their effectiveness.'' The premise has been: How much was spent last year, and how much are we supposed to spend this year. As Schatz says, our question should be ``whether the money is spent well or should be spent at all.'' I believe that we have no other choice than to use all the tools available to us to control Federal spending. The American people would have a hard time believing in some of the things that we do provide funds for--$1.1 million for a plant stress lab. I suppose pork just would not be pork if Congress did not spend $1.5 million for a national pig research facility. All these projects were identified by the Citizens Against Government Waste as examples in their annual analysis of the Federal budget, appropriately called the ``Pig Book.'' They also identified $213 million in pork projects in the 1994 Interior appropriations bill and an astounding $367 million in the 1993 Interior appropriations bill. While to many in Congress these numbers may seem like a drop in the proverbial bucket, it is not insignificant to the American people. They want to know that their hard-earned tax dollars are being used wisely and efficiently. Now, wasteful spending--pork--may be funny to comedians. It may provide fodder for the cannons of American's radio talk show hosts, and it may be the perennial target of deficit and waste watchdog groups, but, ultimately, it is not a laughing matter for the American taxpayer. And it has become Congress' worst oversight. In these days of perpetual deficits and growing debt, the litany of Federal excesses gives new impetus for the waste-cutting power of a line-item veto. It will allow us to look at Government differently. It will allow us to examine the Federal budget process differently. It will allow us to change the power structure of an appropriations process that has bequeathed our Nation and future generations a legacy of deficits and debts. And it will allow us to finally put an end to the fiscal status quo. We hear time and time again that opponents of a line-item veto have said that the result of giving the President line-item veto authority is almost insubstantial, and insignificant considering the size and scope of the Federal budget. In fact, wasteful Government spending has cumulatively constituted a growing portion of our deficits and debt over the years. In fact, President Johnson used this authority to eliminate 6.7 percent of Government outlays in 1967. An equivalent percentage of today's budget would amount to over $100 billion--nearly half of our fiscal year 1996 deficit. A more striking example of the significance and impact of wasteful spending can be shown not between total dollars in wasteful spending and the total Federal budget, but between waste and the average family budget. a median-income, two-earner family paid $5,581 in Federal income taxes. This means that $10 billion in pork wastes the combined taxes of approximately 1.8 million median-income families. Eliminating $1 billion in wasteful spending could actually provide $1,000 in tax relief to 1 million American families. The biggest cost of wasteful spending cannot and should not be measured in terms of dollars and cents. Even more important is the effect of wasteful Government spending in terms of moral imperative. Congress' fiscal irresponsibility demonstrates a clear lack of principle in our Nation's governing institutions, and it is a continuing debasement of our democratic process which results in an erosion of confidence. Opponents of a line-item veto have also failed to address how they would curtail Congress' ongoing practice of funding hundreds of projects and programs each year without the benefit of hearings, proper legal authorization, and frequently in violation of the rules against earmarking. We cannot continue to survive as a supposedly open, democratic, and free Government under late-night deals and last minute insertions of wasteful programs in joint House-Senate conference committees. It is a practice that completely disregards the due process of lawmaking as enshrined by our Founding Fathers. Since the power of Presidential impoundment was taken away in 1974, Presidents have been required to submit spending cut requests-- rescissions--for congressional approval, but only one-third of these have been granted. Under this current system, Congress can kill these requests through inaction, leaving no one to be held responsible for the wasteful spending often targeted by rescission requests. Some opponents of this measure might suggest that, since the 1974 change in law, Congress has actually rescinded $20 billion more than Presidents have requested. However, Congress has ignored 564 rescission proposals offered by Republican Presidents alone, and accepted only 37 percent of all rescissions proposals presented to it. And of the 1,084 rescissions proposed by Presidents from Ford to Clinton, Congress has ignored all but 399. Just imagine how much more deficit reduction could have been attained if both Congress' and the President's rescission proposals had been adopted. Now, there is nothing wrong with the fact that Congress found about $93 billion in rescissions savings since 1974--and that $70 billion of this amount was derived from original proposals independent of the President. I am sure we will hear a lot about this later. But the very fact is, we could have had a much greater reduction in our deficit if we had accepted both the Congress' and the President's rescission proposals. We could have had a total of $143 billion in that time period, which would have represented a 54-percent increase in total deficit reduction above the amount actually rescinded. Now, if Congress disagrees with the President with respect to his rescission proposals, most certainly Congress could come up with alternatives to respond to the President's bottom-line figures in terms of eliminating additional spending. There was a very convincing study that was conducted by the General Accounting Office in 1992, which found that a Presidential line-item veto could, in fact, have saved $70.7 billion in unnecessary spending between fiscal years 1984 and 1989. As this figure indicates, even paring only the most egregious wasteful spending through the line-item veto will reduce the deficit. For those of us who are serious about deficit reduction and responsible spending, $70 billion in deficit reduction over 5 years builds a very strong case for a strong line-item veto. But while opponents will continue to persist about whether we should give the line-item veto authority to the President, clearly it will make a difference in terms of what we can do to the overall budget. Rather than tilting the power of the purse in favor of the President, it would restore some of the balance that has been eroded by Congress' misguided budget rules that favor excessive spending and eleventh-hour reconciliation bills--bills that have become a sanctuary for pork projects. I think we should point to the fact that more than 43 Governors in this country are required to have a line-item veto of some kind, and more than 49 State Governors have a balanced budget. So that the line- item veto may be much less necessary at the State level, where most of the Governors, with the exception of one, are required to balance their budgets. But in the national level, we do not have a requirement for a balanced budget amendment. Without that requirement, without that self-imposed discipline, we continue to watch the rising tide of red ink and the continual rising tide of debts. This line-item veto could help provide substantial cuts in the deficit and Federal spending overall. It will force each and every Member of the House and the Senate to justify the appropriations and the line items in each of the 13 appropriations bills. That they will have to rise and fall on their own merit. That is what it is all about. If there is anything I have heard from my constituents in the State of Maine over and over again is the fact that people are concerned about the way in which our money is being spent. They want to know that it is being spent effectively and efficiently. They want to know that there are merits and there are justifications for the way in which we appropriate their hard-earned taxpayers' dollars. That is the bottom line. In the final analysis, if we do anything else with the line-item veto in addition to cutting spending, we may restore the public's confidence in the way in which we expend their money. Every time they hear example upon example of egregious spending and frivolous spending, it erodes the public's confidence in the budget process, and more than anything else, erodes the public's confidence in this institution and its elected officials. That is why I feel so strongly about this line-item veto. It is one that should be supported by Members of both parties. In fact, President Clinton, during the course of his campaign in 1992, advocated a line- item veto. He had some form of a line-item veto when he was Governor of Arkansas. In fact, he promised during his campaign that he could ax $10 billion in pork-barrel projects over 4 years if he was President of the United States. Since 1993, he has proposed $3.5 billion in rescissions and Congress has only accepted $1.4 billion. Now, the President has called on Congress to give him the line-item veto. It will be interesting to see how many Members of the President's own party will rally to his side and support this measure. I believe the burden of proof is on those who have opposed the balanced budget amendment and those who oppose a line-item veto to suggest ways in which we are going to cut Federal spending. More than that is how we will reach a balanced budget over the next 7 years. This is an approach that makes sense. People have asked me why Congress has not passed a line-item veto. That is a very difficult answer to give. As I said earlier on, I had reservations about this legislation some years ago about wielding and giving too much power to the President. And I have seen the mounting debts and deficits, and the fact that since the last time the Senate passed a balanced budget amendment, but unfortunately Congress did not; in 1982 we have seen the debt grow by 309 percent, $3.5 trillion. I think that Congress needs all the help we can get. It certainly needs all the tools that it can use to reduce the size of this deficit, and ultimately and hopefully balance the budget. Mr. President, in conclusion, it is my hope that we will be able to reach an agreement on a compromise that will give Members the necessary tools to address this most serious of economic problems facing our country. It is not only for the President but it is also the future generations. I encourage all my colleagues on both sides of the aisle to support this measure. I yield the floor.

Ms. SNOWE

Ms. SNOWE. Mr. President, I introduce a package of legislation to meet the needs of America's small businesses. The legislation I am introducing today will help these small businesses by extending a tax deduction for health care coverage, requiring an estimate of the cost of bills on small businesses before Congresses passes those costs, and assign an Assistant U.S. Trade Representative for Small Business. In order to create jobs both in my home State of Maine and across America, we must nurture small businesses, because small business is the engine of our economy. Businesses with fewer than 10 employees make up more than 85 percent of Maine's jobs, and nationally, small businesses employ 54 percent of the private work force. In 1993, small businesses created an estimated 71 percent of the 1.9 million new jobs. When we call small business the ``engine'' of our economy, we mean it: and America's small businesses are jump-starting our economy. Small businesses are the most successful tool for job creation that we have. They provide two-thirds of the initial job opportunities in this country, and are the original--and finest--job training program. Unfortunately, as much as small businesses help our own economy--and the Federal Government--by creating jobs and building economic growth, Government too often gets in the way. Instead of fueling small business, Government too often stalls our small business efforts. Government regulations and redtape add up to more than a billion hours of paperwork time by small businesses each year, according to the Small Business Administration. Moreover, because of the size of some of the largest American corporations, U.S. commerce officials too often devote a disproportionate amount of time to the needs and jobs in corporate America rather than in small businesses. My legislation will address three aspects of our Nation's laws on small businesses, and I hope it will both encourage small business expansion and fuel job creation. First, this legislation will allow self-employed small businessmen and women to fully deduct their health care costs for income tax purposes. This provision will place these entrepreneurs on equal footing with larger companies by eliminating a provision in current law that limits deductions to 25 percent of the overall cost. In addition, the legislation makes the tax deduction permanent. At a time when America is facing challenges to its health care system, and the Federal Government is seeking remedies to the problem of uninsured citizens, this provision will help self-employed business people to afford health insurance without imposing a costly and unnecessary mandate. From investors to start-up businesses, self-employed workers make up an important and vibrant part of the small business sector--and too often they are forgotten in providing benefits and assistance. Indeed, 11 percent of uninsured workers in America are self-employed. By extending tax credits for health insurance to these small businesses, we will help to provide health care coverage to millions of Americans. I am pleased that the Committee on Ways and Means in the U.S. House of Representatives has decided to report out a bill restoring the 25- percent tax deduction retroactively. This decision will allow self- employed small business people to deduct health care costs on their 1994 tax returns. I can think of no better incentive for small businesses than a positive action of this nature. Earlier this month, I joined 74 of my colleagues in writing to the Senate leadership urging quick consideration of this issue once it is transmitted to the Senate from the other body. I remain committed to working with the leadership to restore this crucial provision. My legislation will also require a cost analysis of legislative proposals before new requirements are passed on to small business. Too often, Congress passes well-intended programs that shift the costs of programs to small businesses. The proposal will ensure that these unintended consequences are not passed along to small businesses. According to the U.S. Small Business Administration, small business owners spend at least 1 billion hours a year preparing Government forms, at an annual cost that exceeds $100 billion. Before we place yet another obstacle in the path of small business job creation, we should understand the costs our plans will impose on small businesses. The legislation will require the Director of the Congressional Budget Office to prepare for each committee an analysis of the costs to small businesses that would be incurred in carrying out proposals contained in new legislation. This cost analysis will include an estimate of costs incurred in carrying out the bill or resolution for a 4-year period, as well as an estimate of the portion of these costs that would be borne by small businesses. This provision will allow us to fully consider the impact of our actions on small businesses--and through careful planning, we will succeed in avoiding unintended costs. Finally, this legislation will direct the U.S. Trade Representative to establish a position of Assistant U.S. Trade Representative for Small Business. The Office of the U.S. Trade Representative is overburdened, and too often overlooks the needs of small business. The new Assistant U.S. Trade Representative will promote exports by small businesses and work to remove foreign impediments to these exports. Mr. President, I am convinced that this legislation will truly assist small businesses, resulting not only in additional entrepreneurial opportunities but especially in new jobs. I urge my colleagues to join me in supporting this legislation.

Ms. SNOWE

Ms. SNOWE. Mr. President, I am pleased to join my colleagues from New England in introducing this resolution to grant the consent of Congress to the Northeast Interstate Dairy Compact. The survival of many family dairy farms in Maine and the other New England States depends on prompt passage of this legislation. As in many other rural regions of the country, agriculture is a cornerstone of Maine's economy. Within the agricultural sector, dairy farming usually ranks second or third in cash receipts every year. The dairy industry provides not only jobs for the farmers themselves, but for the people who sell farm machinery, service the machinery, sell fuel and feed, and provide other goods and services. Dairy farms also account for large shares of the municipal tax base throughout rural Maine, making them critical contributors to local schools and essential town services. Unfortunately, all is not well in the Maine dairy industry. In 1978, Maine had 1,133 dairy farms. By 1988, that number had declined to 800. In 1991, there were 680. And by 1994, the number dwindled further to 606. This precipitous decline in the number of dairy farms can be attributed to several factors, most notably to the fact that dairy prices are very low while costs remain high, and these same circumstances are driving farmers in other New England States out of business as well. In Maine, the average cost of producing milk is $17 per 100 pounds. The June 1994 Federal order price in the Northeast was $16.23 per hundred. For August of 1994, the market order price declined to $14.49. In 1993, the average milk price in the Northeast declined by 54 cents per hundred. Milk prices simply have not increased in concert with production. Whereas the retail price for a gallon of milk in 1991 was $2.20 a gallon, that same gallon still retailed for $2.20 a Another contributing factor in the loss of dairy farms is price volatility. Prices can decline by $2 per hundred in less than 3 months. These price swings add serious uncertainty to a farmer's daily existence, making it difficult for the farmer to plan strategically or to raise capital when needed. The State of Maine attempted to address this serious problem by establishing a dairy vendor's fee that stabilized the price that farmers in Maine received for their milk. The vendor's fee enjoyed the strong support of both farmers and consumers in Maine, but a Federal court struck it down in 1994 as a violation of interstate commerce. According to the Maine Department of Agriculture, the inevitable result of the court's action will be an accelerating decline in family dairy farms. Faced with similar problems throughout the region, the six New England States banded together to develop a joint regional solution. They negotiated an interstate dairy compact that will ensure a more reasonable and stable price for dairy farmers in the region. But it is a pricing program that also protects the interests of consumers in the region. As evidence of the balance and fairness achieved by the compact, both the net-producing and net-consuming States in the region all approved it with strong support. The compact creates a regional commission which has the authority to set minimum prices paid to farmers for fluid, or class I milk. Delegations from each State comprise the voting membership of the commission, and these delegations in turn will include both farmer and consumer representatives. The minimum price established by the commission is the Federal market order price plus a small over-order differential that would be paid by milk processing plants. This over- order price is capped in the compact, and a two-thirds voting majority of the commission is required before any over-order price can be instituted. Mr. President, until the court struck down the Maine dairy vendor's fee, milk in my State was priced by a mechanism that is similar to that which could be utilized by the compact commission. Maine's experience was uniformly positive. Farm prices were stable, and they were higher, but only modestly higher. No farmers got rich on the minimal adjustment provided by the over-order price under the vendor's fee program. It helped them keep their heads above water. Dairy processors and vendors maintained their business, and consumers did not see any significant increases in the price of milk. It was a win-win proposition for everyone in Maine, and I am confident that the compact will achieve the same success throughout New England without violating the Constitution's interstate commerce clause. Although the compact affects only the participating States, the cosponsors decided to remove any doubt by including language in the resolution that provides explicit assurances to farmers and processors in States outside the region. These assurances further specify that the over-order price can only be established for class I fluid milk, that no new States can join the compact without the formal approval of both Houses of Congress, that out-of-region farmers who sell milk in the compact region will get the same price as farmers in the region, that the commission's pricing authority is strictly limited, and that the commission must develop a plan to ensure that over-order prices do not lead to increases in production. In the debates held so far in this Congress, and surely in the debates to come, we have heard and will hear many Members argue that the States are often best-positioned to solve their own problems, and that they should be allowed to do so without interference from Washington. I couldn't agree more. With the Northeast Interstate Dairy Compact bill being introduced today, Senators will have an opportunity to match words on this concept with deeds. The compact represents a regional response to a regional problem. It affects only those States that belong to the compact. Why should the Federal Government deny the States an opportunity to solve their own problems? The answer is that we shouldn't. We should praise the States for their self-reliance and ingenuity. I hope that Senators will recognize the value in this kind of State-based problem-solving, and support the compact when it comes to the floor for a vote.