Arlen Specter

Mr. SPECTER

Mr. SPECTER. Mr. President, I have sought recognition to introduce legislation which may be cited as the Fairness In Asbestos Injury Resolution Act of 2005. I do so on behalf of Senator Leahy, the ranking member of the Judiciary Committee, Senator Hatch, the former chairman of the committee, Senator Feinstein, Senator DeWine, Senator Baucus, Senator Voinovich and Senator Grassley. There are others in the wings waiting to cosponsor, but this is a very complex bill, ranging over 300 pages. Quite a number of my colleagues have told me they are supportive of the bill and are making the final check to determine cosponsorship. Several months ago, a discussion draft was circulated. Last week, after a great many refinements had been added, the current bill was circulated. There have been a couple of relatively minor changes which have been added to this bill, but it is essentially the same as the circulation bill which was submitted a week ago. I compliment my distinguished colleague, Senator Leahy, the ranking member, for his diligence, hard work and cooperation in structuring a bill with a great many moving parts, which he and I have been able to agree upon on the core principles. We have adopted a position that we will work jointly to retain these core provisions. We are open to suggestions and amendments and modifications which do not impact on these core provisions. But it is a very difficult matter to structure an asbestos bill which can pass the Senate. There are 55 Republicans. You need at least five Democrats. It has to be a balanced bill, and it is our submission that this is a balanced bill. A great deal of credit is due to senior Federal Judge Edward R. Becker, who until May 5, his 70th birthday, in the year 2003 was the chief judge of the Court of Appeals for the Third Circuit who wrote the opinion on the asbestos litigation which reached the Supreme Court of the United States. When the Judiciary Committee passed out of committee legislation on asbestos in July of 2003, the distinguished Presiding Officer was on the committee at that time and can attest to the 12-hour marathon session we had. We did so significantly along party lines to move the legislation along, recognizing it had many problems. At my request, Judge Becker then convened the so-called stakeholders in his chambers in Philadelphia for 2 days in August, the stakeholders being identified as the manufacturers, the AFL-CIO, the insurance industry, and the trial lawyers. To recite the power and diversity and difference of opinion of these groups is to suggest the complication of bringing the stakeholders together on a piece of complex legislation. Following those 2 days of meetings in Judge Becker's chambers, we have had some 36 sessions in my conference room here in the Hart Senate Office Building where Judge Becker presided and I assisted, and we worked out a great many of the issues to the satisfaction of the stakeholders. One of the core provisions of the bill is that there is a trust fund of $140 billion. It is always difficult on projections to be absolutely certain, but I believe there is a very high probability that this trust fund will be adequate to pay all of the claims. In very extensive testimony from Goldman Sachs on very carefully calculated projections, it was projected that the total cost of payments would be $118 billion. There is a considerable cushion between $118 billion and $140 billion. If for some unexpected reason the trust fund is insufficient, then those who have been injured by exposure to asbestos will be able to revert to jury trials. All of us are mindful of the very substantial factor when a claimant gives up a constitutional right to jury trial, but in a program structured largely along lines of workmen's compensation, it is our conclusion that it is a fair exchange. When you find that there are many people who are suffering deadly ailments from asbestos, mesothelioma and other deadly injuries, who are not being compensated, this is a way to compensate those individuals whose companies have gone bankrupt. Over 75 companies have gone bankrupt at a tremendous impact to the economy. This will relieve the companies of the onerous threat of bankruptcy--and they are taking additional companies with rapidity. On one development which candidly surprised me, last week, when we circulated the draft bill a week ago today, there was a 25-point bump in the stock market for asbestos companies. When we had a meeting later in the day and deferred production of the bill, the stock market went down to some extent. There is some consideration that the stock market is wiser even than Congress. Perhaps that would take a whole lot. But the reaction of the stock market is an indication of the importance of resolving this asbestos issue in order to give the economy a start. The hour is late. There are others who wish to seek recognition. The distinguished chairman of the Appropriations Committee is waiting through this nongermane part of his business, and the distinguished Democratic leader, I know, wants to seek recognition. I shall include the remainder of my statement in the Record and ask unanimous consent that it be printed.

Mr. SPECTER. Mr. President, I ask unanimous consent that the text of the bill be printed. Mr. President, I ask unanimous consent between the comments I have made, which have not been made from a text, and the text of my language which I am currently stating, be included, so that those who read the Congressional Record, if anyone does, will know the repetition in the prepared text is occasioned by the fact that the initial statement was made without reference to a text and there will necessarily be some repetition in the prepared text. I thank the Chair. I yield the floor.

Mr. SPECTER

Mr. SPECTER. Mr. President, I have sought recognition today to introduce the Prescription Drug and Health Improvement Act of 2005 to reduce the high prices of prescription drugs for Medicare beneficiaries. I introduced a similar version of this bill in the 108th Congress, S. 2766. To increase the likelihood that this bill may become law this bill does not include a costly provision which would have closed the gap in prescription drug costs for Medicare beneficiaries. Americans, specifically senior citizens, pay the highest prices in the world for brand-name prescription drugs. With 45 million uninsured Americans and many more senior citizens without an adequate prescription drug benefit, filling a doctor's prescription is unaffordable for many people in this country. The United States has the greatest health care system in the world; however, too many seniors are forced to make difficult choices between life-sustaining prescription drugs and daily necessities. The Centers for Medicare and Medicaid Services estimate that in 2004 per capita spending on prescription drugs rose approximately 12 percent, with a similar rate of growth expected for this year. Much of the increase in drug spending is due to higher utilization and the shift from older, lower cost drugs to newer, higher cost drugs. However, rapidly increasing drug prices are a critical component. High drug prices, combined with the surging older population, are also taking a toll on State budgets and private sector health insurance benefits. Medicaid spending on prescription drugs increased at an average annual rate of nearly 19 percent between 1998 and 2002. Until lower priced drugs are available, pressures will continue to squeeze public programs at both the State and Federal level. To address these problems, my legislation would reduce the high prices of prescription drugs to seniors by repealing the prohibition against interference by the Secretary of HHS with negotiations between drug manufacturers, pharmacies, and prescription drug plan sponsors and instead authorize the Secretary to negotiate contracts with manufacturers of covered prescription drugs. It will allow the Secretary of HHS to use Medicare's large beneficiary population to leverage bargaining power to obtain lower prescription drug prices for Medicare beneficiaries. Price negotiations between the Secretary of HHS and prescription drug manufacturers would be analogous to the ability of the Secretary of Veterans Affairs to negotiate prescription drug prices with manufacturers. This bargaining power enables veterans to receive prescription drugs at a significant cost savings. According to the National Association of Chain Drug Stores, the average ``cash cost'' of a prescription in 2001 was $40.22. The average cost in the Veterans Affairs (VA) health care system in fiscal year 2001 was $22.87. In the 108th Congress, in my capacity as chairman of the Veterans' Affairs Committee, I introduced the Veterans Prescription Drugs Assistance Act, S. 1153, which was reported out of committee, but was not considered before the full Senate. In the 109th Congress, I have again introduced the Veterans Prescription Drugs Assistance Act, S. 614. This legislation will broaden the ability of veterans to access the Veterans Affairs' Prescription Drug Program. Under my bill, all Medicare-eligible veterans will be able to purchase medications at a tremendous price reduction through the Veterans Affairs' Prescription Drug Program. In many cases, this will save veterans who are Medicare beneficiaries up to 50 percent on the cost of prescribed medications, a significant savings for veterans. Similar savings may be available to America's seniors from the savings achieved using the HHS bargaining power, like the Veterans Affairs bargaining power for the benefit of veterans. These savings may provide America's seniors with fiscal relief from the increasing costs of prescription drugs. I believe this bill can provide desperately needed access to inexpensive, effective prescription drugs for America's seniors. The time has come for concerted action in this arena. I urge my colleagues to move this legislation forward promptly. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. SPECTER

Mr. SPECTER. Mr. President, I have sought recognition today to introduce the Prescription Drug and Health Improvement Act of 2005 to reduce the high prices of prescription drugs for Medicare beneficiaries. I introduced a similar version of this bill in the 108th Congress, S. 2766. To increase the likelihood that this bill may become law this bill does not include a costly provision which would have closed the gap in prescription drug costs for Medicare beneficiaries. Americans, specifically senior citizens, pay the highest prices in the world for brand-name prescription drugs. With 45 million uninsured Americans and many more senior citizens without an adequate prescription drug benefit, filling a doctor's prescription is unaffordable for many people in this country. The United States has the greatest health care system in the world; however, too many seniors are forced to make difficult choices between life-sustaining prescription drugs and daily necessities. The Centers for Medicare and Medicaid Services estimate that in 2004 per capita spending on prescription drugs rose approximately 12 percent, with a similar rate of growth expected for this year. Much of the increase in drug spending is due to higher utilization and the shift from older, lower cost drugs to newer, higher cost drugs. However, rapidly increasing drug prices are a critical component. High drug prices, combined with the surging older population, are also taking a toll on State budgets and private sector health insurance benefits. Medicaid spending on prescription drugs increased at an average annual rate of nearly 19 percent between 1998 and 2002. Until lower priced drugs are available, pressures will continue to squeeze public programs at both the State and Federal level. To address these problems, my legislation would reduce the high prices of prescription drugs to seniors by repealing the prohibition against interference by the Secretary of HHS with negotiations between drug manufacturers, pharmacies, and prescription drug plan sponsors and instead authorize the Secretary to negotiate contracts with manufacturers of covered prescription drugs. It will allow the Secretary of HHS to use Medicare's large beneficiary population to leverage bargaining power to obtain lower prescription drug prices for Medicare beneficiaries. Price negotiations between the Secretary of HHS and prescription drug manufacturers would be analogous to the ability of the Secretary of Veterans Affairs to negotiate prescription drug prices with manufacturers. This bargaining power enables veterans to receive prescription drugs at a significant cost savings. According to the National Association of Chain Drug Stores, the average ``cash cost'' of a prescription in 2001 was $40.22. The average cost in the Veterans Affairs (VA) health care system in fiscal year 2001 was $22.87. In the 108th Congress, in my capacity as chairman of the Veterans' Affairs Committee, I introduced the Veterans Prescription Drugs Assistance Act, S. 1153, which was reported out of committee, but was not considered before the full Senate. In the 109th Congress, I have again introduced the Veterans Prescription Drugs Assistance Act, S. 614. This legislation will broaden the ability of veterans to access the Veterans Affairs' Prescription Drug Program. Under my bill, all Medicare-eligible veterans will be able to purchase medications at a tremendous price reduction through the Veterans Affairs' Prescription Drug Program. In many cases, this will save veterans who are Medicare beneficiaries up to 50 percent on the cost of prescribed medications, a significant savings for veterans. Similar savings may be available to America's seniors from the savings achieved using the HHS bargaining power, like the Veterans Affairs bargaining power for the benefit of veterans. These savings may provide America's seniors with fiscal relief from the increasing costs of prescription drugs. I believe this bill can provide desperately needed access to inexpensive, effective prescription drugs for America's seniors. The time has come for concerted action in this arena. I urge my colleagues to move this legislation forward promptly. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. SPECTER. Mr. President, this week, American taxpayers face another Federal income tax deadline. The date of April 15 stabs fear, anxiety, and unease into the hearts of millions of Americans. Every year during ``tax season,'' millions of Americans spend their evenings poring over page after page of IRS instructions, going through their records looking for information and struggling to find and fill out all the appropriate forms on the Federal tax returns. Americans are intimidated by the sheer number of different tax forms and their instructions, many of which they may be unsure whether they need to file. Given the approximately 325 possible forms, not to mention the instructions that accompany them, simply trying to determine which form to file can in itself be a daunting and overwhelming task. According to a 2002 study conducted by the Tax Foundation, American taxpayers, including businesses, spend more than 5.8 billion hours and $194 billion each year in complying with tax laws. That works out to more than $2,400 per U.S. household. Much of this time is spent burrowing through IRS laws and regulations which fill 17,000 pages and have grown from 744,000 words in 1955 to over 6.9 million words in 2000. By contrast, the Pledge of Allegiance has only 31 words, the Gettysburg Address has 267 words, the Declaration of Independence has about 1,300 words, and the Bible has only about 1,773,000 words. The majority of taxpayers still face filing tax forms that are far too complicated and take far too long to complete. According to the estimated preparation time listed on the forms by the IRS, the 2004 Form 1040 is estimated to take 13 hours and 35 minutes to complete. Moreover this does not include the estimated time to complete the accompanying schedules, such as Schedule A, for itemized deductions, which carries an estimated preparation time of 5 hours, 37 minutes, or Schedule D, for reporting capital gains and losses, shows an estimated preparation time of 6 hours, 10 minutes. Moreover, this complexity is getting worse each year. Just from 2000 to 2004 the estimated time to prepare Form 1040 jumped 34 minutes. It is no wonder that well over half of all taxpayers, 56 percent according to a recent survey, now hire an outside professional to prepare their tax returns for them. However, the fact that only about 30 percent of individuals itemize their deductions shows that a significant percentage of our taxpaying population believes that the tax system is too complex for them to deal with. We all understand that paying taxes will never be something we enjoy, but neither should it be cruel and unusual punishment. Further, the pace of change to the Internal Revenue Code is brisk--Congress made about 9,500 tax code changes in the past thirteen years. And we are far from being finished. Year after year, we continue to ask the same question--isn't there a better way? My flat tax legislation would make filing a tax return a manageable chore, not a seemingly endless nightmare, for most taxpayers. My flat tax legislation will fundamentally revise the present tax code, with its myriad rates, deductions, and instructions. This legislation would institute a simple, flat 20 percent tax rate for all individuals and businesses. This proposal is not cast in stone, but is intended to move the debate forward by focusing attention on three key principles which are critical to an effective and equitable taxation system: simplicity, fairness and economic growth. My flat tax plan would eliminate the kinds of frustrations I have outlined above for millions of taxpayers. This flat tax would enable us to scrap the great majority of the IRS rules, regulations and instructions and delete most of the 6.9 million words in the Internal Revenue Code. Instead of billions of hours of non-productive time spent in compliance with, or avoidance of, the tax code, taxpayers would spend only the small amount of time necessary to fill out a postcard- sized form. Both business and individual taxpayers would thus find valuable hours freed up to engage in productive business activity, or for more time with their families, instead of poring over tax tables, schedules and regulations. My flat tax proposal is dramatic, but so are its advantages: a taxation system that is simple, fair and designed to maximize prosperity for all Americans. A summary of the key advantages are: Simplicity: A 10-line postcard filing would replace the myriad forms and attachments currently required, thus saving Americans up to 5.8 billion hours they currently spend every year in tax compliance. Cuts Government: The flat tax would eliminate the lion's share of IRS rules, regulations and requirements, which have grown from 744,000 words in 1955 to 6.9 million words and 17,000 pages currently. It would also allow us to slash the mammoth IRS bureaucracy of approximately 117,000 employees, creating opportunities to put their expertise to use elsewhere in the government or in private industry. Promotes Economic Growth: Economists estimate a growth due to a flat tax of over $2 trillion in national wealth over seven years, representing an increase of approximately $7,500 in personal wealth for every man, woman and child in America. This growth would also lead to the creation of 6 million new jobs. Increases Efficiency: Investment decisions would be made on the basis of productivity rather than simply for tax avoidance, thus leading to even greater economic expansion. Reduces Interest Rates: Economic forecasts indicate that interest rates would fall substantially, by as much as two points, as the flat tax removes many of the current disincentives to savings. Lowers compliance costs: Americans would be able to save or invert up to $194 billion they currently spend every year in tax compliance. Decreases fraud: As tax loopholes are eliminated and the tax code is simplified, there will be far less opportunity for tax avoidance and fraud, which now amounts to over $120 billion in uncollected revenue annually. Reduces IRS costs: Simplification of the tax code will allow us to save significantly on the $10 billion annual budget currently allocated to the Internal Revenue Service. The most dramatic way to illustrate the flat tax is to consider that the income tax form for the flat tax is printed on a postcard--it will allow all taxpayers to file their April 15 tax returns on a simple 10- line postcard. This postcard will take 15 minutes to fill out. At my town hall meetings across Pennsylvania, there is considerable public support for fundamental tax reform. This is a win-win situation for America because it lowers the tax burden on the taxpayers in the lower brackets. For example in the 2004 tax year, the standard deduction is $4,850 for a single taxpayer, $7,150 for a head of household and $9,700 for a married couple filing jointly, while the personal exemption for individuals and dependents is $3,100. Thus, under the current tax code, a family of four which does not itemize deductions would pay taxes on all income over $22,100--that is personal exemptions of$12,400 and a standard deduction of $9,700. By contrast, under my flat tax bill, that same family would receive a personal exemption of $30,000, and would pay tax on only income over that amount. The tax loopholes enable write-offs of some $393 billion a year. What is eliminated under the flat tax are the loopholes, the deductions in this complicated code which can be deciphered, interpreted, and found really only by the $500-an-hour lawyers. That money is lost to the taxpayers. $120 billion would be saved by the elimination of fraud because of the simplicity of the Tax Code, the taxpayer being able to find out exactly what they owe. This bill is modeled after a proposal organized and written by two very distinguished professors of law from Stanford University, Professor Hall and Professor Rabushka. Their model was first introduced in the Congress in the fall of 1994 by Majority Leader Richard Armey. I introduced the flat tax bill--the first one in the Senate--on March 2, 1995, Senate bill 488. On October 27, 1995, I introduced a Sense of the Senate Resolution calling on my colleagues to expedite Congressional adoption of a flat tax. The Resolution, which was introduced as an amendment to pending legislation, was not adopted. I reintroduced my legislation in the 105th Congress with slight modifications to reflect inflation-adjusted increases in the personal allowances and dependent allowances. I re-reintroduced the bill on April 15, 1999--income tax day--in a bill denominated as S. 822. I then introduced my flat tax legislation as an amendment to S. 1429, the Tax Reconciliation bill; the amendment was not adopted. During the 108th Congress, I introduced my flat tax legislation once again on April 11, 2003. On May 14, 2003, I offered an amendment to the Tax Reconciliation legislation urging the Senate to hold hearings and consider legislation providing for a flat tax; this amendment passed by a vote of 70 to 30 on May 15, 2003. I then testified on this issue at a subsequent hearing held by the Joint Economic Committee on November 5, 2003. Over the years and prior to my legislative efforts on behalf of flat tax reform, I have devoted considerable time and attention to analyzing our nation's tax code and the policies which underlie it. I began the study of the complexities of the tax code over 40 years ago as a law student at Yale University. I included some tax law as part of my practice in my early years as an attorney in Philadelphia. In the spring of 1962, I published a law review article in the Villanova Law Review, ``Pension and Profit Sharing Plans: Coverage and Operation for Closely Held Corporations and Professional Associations,'' 7 Villanova L. Rev. 335, which in part focused on the inequity in making tax-exempt retirement benefits available to some kinds of businesses but not others. It was apparent then, as it is now, that the very complexities of the Internal Revenue Code could be used to give unfair advantage to some. Einstein himself is quoted as saying ``the hardest thing in the world to understand is the income tax.'' The Hall-Rabushka model envisioned a flat tax with no deductions whatever. After considerable reflection, I decided to include in the legislation limited deductions for home mortgage interest for up to $100,000 in borrowing and charitable contributions up to $2,500. While these modifications undercut the pure principle of the flat tax by continuing the use of tax policy to promote home buying and charitable contributions, I believe that those two deductions are so deeply ingrained in the financial planning of American families that they should be retained as a matter of fairness and public policy--and also political practicality. With those two deductions maintained, passage of a modified flat tax will be difficult, but without them, probably impossible. In my judgment, an indispensable prerequisite to enactment of a modified flat tax is revenue neutrality. Professor Hall advised that the revenue neutrality ofthe Hall-Rabushka proposal, which uses a 19 percent rate, is based on a well-documented model founded on reliable governmental statistics. My legislation raises that rate from 19 percent to 20 percent to accommodate retaining limited home mortgage interest and charitable deductions. This proposal taxes business revenues fully at their source, so that there is no personal taxation on interest, dividends, capital gains, gifts or estates. Restructured in this way, the tax code can become a powerful incentive for savings and investment--which translates into economic growth and expansion, more and better jobs, and raising the standard of living for all Americans. The key advantages of this flat tax plan are threefold: First, it will dramatically simplify the payment of taxes. Second, it will remove much of the IRS regulatory morass now imposed on individual and corporate taxpayers, and allow those taxpayers to devote more of their energies to productive pursuits. Third, since it is a plan which rewards savings and investment, the flat tax will spur economic growth in all sectors of the economy as more money flows into investments and savings accounts. Professors Hall and Rabushka have projected that within seven years of enactment, this type of a flat tax would produce a 6 percent increase in output from increased total work in the U.S. economy and increased capital formation. The economic growth would mean a $7,500 increase in the personal income of all Americans. No one likes to pay taxes. But Americans will be much more willing to pay their taxes under a system that they believe is fair, a system that they can understand, and a system that they recognize promotes rather than prevents growth and prosperity. My flat tax legislation will afford Americans such a tax system. I ask unanimous consent that a copy of my flat tax postcard, a variety of specific cases that illustrate the fairness and simplicity of this flat tax, and an example flat tax table be printed in the Record following my statement. I ask unanimous consent that the text of this bill be printed in the Record. [GRAPHIC] [TIFF OMITTED] TS15AP05.001 [GRAPHIC] [TIFF OMITTED] TS15AP05.002 [GRAPHIC] [TIFF OMITTED] TS15AP05.003 [GRAPHIC] [TIFF OMITTED] TS15AP05.004

Mr. SPECTER

Mr. SPECTER. Mr. President, this week, American taxpayers face another Federal income tax deadline. The date of April 15 stabs fear, anxiety, and unease into the hearts of millions of Americans. Every year during ``tax season,'' millions of Americans spend their evenings poring over page after page of IRS instructions, going through their records looking for information and struggling to find and fill out all the appropriate forms on the Federal tax returns. Americans are intimidated by the sheer number of different tax forms and their instructions, many of which they may be unsure whether they need to file. Given the approximately 325 possible forms, not to mention the instructions that accompany them, simply trying to determine which form to file can in itself be a daunting and overwhelming task. According to a 2002 study conducted by the Tax Foundation, American taxpayers, including businesses, spend more than 5.8 billion hours and $194 billion each year in complying with tax laws. That works out to more than $2,400 per U.S. household. Much of this time is spent burrowing through IRS laws and regulations which fill 17,000 pages and have grown from 744,000 words in 1955 to over 6.9 million words in 2000. By contrast, the Pledge of Allegiance has only 31 words, the Gettysburg Address has 267 words, the Declaration of Independence has about 1,300 words, and the Bible has only about 1,773,000 words. The majority of taxpayers still face filing tax forms that are far too complicated and take far too long to complete. According to the estimated preparation time listed on the forms by the IRS, the 2004 Form 1040 is estimated to take 13 hours and 35 minutes to complete. Moreover this does not include the estimated time to complete the accompanying schedules, such as Schedule A, for itemized deductions, which carries an estimated preparation time of 5 hours, 37 minutes, or Schedule D, for reporting capital gains and losses, shows an estimated preparation time of 6 hours, 10 minutes. Moreover, this complexity is getting worse each year. Just from 2000 to 2004 the estimated time to prepare Form 1040 jumped 34 minutes. It is no wonder that well over half of all taxpayers, 56 percent according to a recent survey, now hire an outside professional to prepare their tax returns for them. However, the fact that only about 30 percent of individuals itemize their deductions shows that a significant percentage of our taxpaying population believes that the tax system is too complex for them to deal with. We all understand that paying taxes will never be something we enjoy, but neither should it be cruel and unusual punishment. Further, the pace of change to the Internal Revenue Code is brisk--Congress made about 9,500 tax code changes in the past thirteen years. And we are far from being finished. Year after year, we continue to ask the same question--isn't there a better way? My flat tax legislation would make filing a tax return a manageable chore, not a seemingly endless nightmare, for most taxpayers. My flat tax legislation will fundamentally revise the present tax code, with its myriad rates, deductions, and instructions. This legislation would institute a simple, flat 20 percent tax rate for all individuals and businesses. This proposal is not cast in stone, but is intended to move the debate forward by focusing attention on three key principles which are critical to an effective and equitable taxation system: simplicity, fairness and economic growth. My flat tax plan would eliminate the kinds of frustrations I have outlined above for millions of taxpayers. This flat tax would enable us to scrap the great majority of the IRS rules, regulations and instructions and delete most of the 6.9 million words in the Internal Revenue Code. Instead of billions of hours of non-productive time spent in compliance with, or avoidance of, the tax code, taxpayers would spend only the small amount of time necessary to fill out a postcard- sized form. Both business and individual taxpayers would thus find valuable hours freed up to engage in productive business activity, or for more time with their families, instead of poring over tax tables, schedules and regulations. My flat tax proposal is dramatic, but so are its advantages: a taxation system that is simple, fair and designed to maximize prosperity for all Americans. A summary of the key advantages are: Simplicity: A 10-line postcard filing would replace the myriad forms and attachments currently required, thus saving Americans up to 5.8 billion hours they currently spend every year in tax compliance. Cuts Government: The flat tax would eliminate the lion's share of IRS rules, regulations and requirements, which have grown from 744,000 words in 1955 to 6.9 million words and 17,000 pages currently. It would also allow us to slash the mammoth IRS bureaucracy of approximately 117,000 employees, creating opportunities to put their expertise to use elsewhere in the government or in private industry. Promotes Economic Growth: Economists estimate a growth due to a flat tax of over $2 trillion in national wealth over seven years, representing an increase of approximately $7,500 in personal wealth for every man, woman and child in America. This growth would also lead to the creation of 6 million new jobs. Increases Efficiency: Investment decisions would be made on the basis of productivity rather than simply for tax avoidance, thus leading to even greater economic expansion. Reduces Interest Rates: Economic forecasts indicate that interest rates would fall substantially, by as much as two points, as the flat tax removes many of the current disincentives to savings. Lowers compliance costs: Americans would be able to save or invert up to $194 billion they currently spend every year in tax compliance. Decreases fraud: As tax loopholes are eliminated and the tax code is simplified, there will be far less opportunity for tax avoidance and fraud, which now amounts to over $120 billion in uncollected revenue annually. Reduces IRS costs: Simplification of the tax code will allow us to save significantly on the $10 billion annual budget currently allocated to the Internal Revenue Service. The most dramatic way to illustrate the flat tax is to consider that the income tax form for the flat tax is printed on a postcard--it will allow all taxpayers to file their April 15 tax returns on a simple 10- line postcard. This postcard will take 15 minutes to fill out. At my town hall meetings across Pennsylvania, there is considerable public support for fundamental tax reform. This is a win-win situation for America because it lowers the tax burden on the taxpayers in the lower brackets. For example in the 2004 tax year, the standard deduction is $4,850 for a single taxpayer, $7,150 for a head of household and $9,700 for a married couple filing jointly, while the personal exemption for individuals and dependents is $3,100. Thus, under the current tax code, a family of four which does not itemize deductions would pay taxes on all income over $22,100--that is personal exemptions of$12,400 and a standard deduction of $9,700. By contrast, under my flat tax bill, that same family would receive a personal exemption of $30,000, and would pay tax on only income over that amount. The tax loopholes enable write-offs of some $393 billion a year. What is eliminated under the flat tax are the loopholes, the deductions in this complicated code which can be deciphered, interpreted, and found really only by the $500-an-hour lawyers. That money is lost to the taxpayers. $120 billion would be saved by the elimination of fraud because of the simplicity of the Tax Code, the taxpayer being able to find out exactly what they owe. This bill is modeled after a proposal organized and written by two very distinguished professors of law from Stanford University, Professor Hall and Professor Rabushka. Their model was first introduced in the Congress in the fall of 1994 by Majority Leader Richard Armey. I introduced the flat tax bill--the first one in the Senate--on March 2, 1995, Senate bill 488. On October 27, 1995, I introduced a Sense of the Senate Resolution calling on my colleagues to expedite Congressional adoption of a flat tax. The Resolution, which was introduced as an amendment to pending legislation, was not adopted. I reintroduced my legislation in the 105th Congress with slight modifications to reflect inflation-adjusted increases in the personal allowances and dependent allowances. I re-reintroduced the bill on April 15, 1999--income tax day--in a bill denominated as S. 822. I then introduced my flat tax legislation as an amendment to S. 1429, the Tax Reconciliation bill; the amendment was not adopted. During the 108th Congress, I introduced my flat tax legislation once again on April 11, 2003. On May 14, 2003, I offered an amendment to the Tax Reconciliation legislation urging the Senate to hold hearings and consider legislation providing for a flat tax; this amendment passed by a vote of 70 to 30 on May 15, 2003. I then testified on this issue at a subsequent hearing held by the Joint Economic Committee on November 5, 2003. Over the years and prior to my legislative efforts on behalf of flat tax reform, I have devoted considerable time and attention to analyzing our nation's tax code and the policies which underlie it. I began the study of the complexities of the tax code over 40 years ago as a law student at Yale University. I included some tax law as part of my practice in my early years as an attorney in Philadelphia. In the spring of 1962, I published a law review article in the Villanova Law Review, ``Pension and Profit Sharing Plans: Coverage and Operation for Closely Held Corporations and Professional Associations,'' 7 Villanova L. Rev. 335, which in part focused on the inequity in making tax-exempt retirement benefits available to some kinds of businesses but not others. It was apparent then, as it is now, that the very complexities of the Internal Revenue Code could be used to give unfair advantage to some. Einstein himself is quoted as saying ``the hardest thing in the world to understand is the income tax.'' The Hall-Rabushka model envisioned a flat tax with no deductions whatever. After considerable reflection, I decided to include in the legislation limited deductions for home mortgage interest for up to $100,000 in borrowing and charitable contributions up to $2,500. While these modifications undercut the pure principle of the flat tax by continuing the use of tax policy to promote home buying and charitable contributions, I believe that those two deductions are so deeply ingrained in the financial planning of American families that they should be retained as a matter of fairness and public policy--and also political practicality. With those two deductions maintained, passage of a modified flat tax will be difficult, but without them, probably impossible. In my judgment, an indispensable prerequisite to enactment of a modified flat tax is revenue neutrality. Professor Hall advised that the revenue neutrality ofthe Hall-Rabushka proposal, which uses a 19 percent rate, is based on a well-documented model founded on reliable governmental statistics. My legislation raises that rate from 19 percent to 20 percent to accommodate retaining limited home mortgage interest and charitable deductions. This proposal taxes business revenues fully at their source, so that there is no personal taxation on interest, dividends, capital gains, gifts or estates. Restructured in this way, the tax code can become a powerful incentive for savings and investment--which translates into economic growth and expansion, more and better jobs, and raising the standard of living for all Americans. The key advantages of this flat tax plan are threefold: First, it will dramatically simplify the payment of taxes. Second, it will remove much of the IRS regulatory morass now imposed on individual and corporate taxpayers, and allow those taxpayers to devote more of their energies to productive pursuits. Third, since it is a plan which rewards savings and investment, the flat tax will spur economic growth in all sectors of the economy as more money flows into investments and savings accounts. Professors Hall and Rabushka have projected that within seven years of enactment, this type of a flat tax would produce a 6 percent increase in output from increased total work in the U.S. economy and increased capital formation. The economic growth would mean a $7,500 increase in the personal income of all Americans. No one likes to pay taxes. But Americans will be much more willing to pay their taxes under a system that they believe is fair, a system that they can understand, and a system that they recognize promotes rather than prevents growth and prosperity. My flat tax legislation will afford Americans such a tax system. I ask unanimous consent that a copy of my flat tax postcard, a variety of specific cases that illustrate the fairness and simplicity of this flat tax, and an example flat tax table be printed in the Record following my statement. I ask unanimous consent that the text of this bill be printed in the Record. [GRAPHIC] [TIFF OMITTED] TS15AP05.001 [GRAPHIC] [TIFF OMITTED] TS15AP05.002 [GRAPHIC] [TIFF OMITTED] TS15AP05.003 [GRAPHIC] [TIFF OMITTED] TS15AP05.004

Mr. SPECTER

Mr. SPECTER. I intend to conclude at 5:30 so we can start the vote because there are two votes. I know people are anxious to have the votes start. I do not think there is any question about Mr. Crotty being confirmed. He is an able candidate. It is my hope that we will be able to move other nominees to the Senate floor for confirmation. The committee has reported out the nomination of William Myers, and it is my hope we will get an up-or- down vote on Mr. Myers. There is significant opposition, which I understand. We are moving to conclude the consideration of Mr. Griffith, and then we have other nominees behind him. I yield back the remainder of my time, and I ask for the yeas and nays on this nomination.

Mr. SPECTER. Mr. President, I thank the distinguished ranking member for his cooperation in moving the nomination of Paul A. Crotty to the U.S. District Court for the Southern District of New York. By way of a very brief reply, I came in in the middle of the comments by the Senator from Vermont because he and I just attended a very lengthy meeting on the asbestos issue. We are working very hard and cooperatively on many matters on the Judiciary Committee. Asbestos is very high on the list. Just a brief comment there. There are thousands of victims of mesothelioma who are dying and not being compensated because their companies have gone into bankruptcy. Some 74 companies have gone into bankruptcy, an enormous drain on the economy. I think it is fair to say that we just had a positive meeting with a number of Democrats and with Members of my side of the aisle. We are making progress. I could not be here at the start of the argument because of the commitment there. I came in to hear the Senator from Vermont comment about the President, and I believe the President has made comments which are supportive of the Federal judiciary, as has the majority leader, Senator Frist, made comments supportive of the Federal judiciary. The Schaivo case raised the emotional level very high in the United States--really, beyond--for people who were on both sides of the issue. The rhetoric, I am pleased to see, has cooled, at least to some extent, but I believe that the Federal judiciary acquitted themselves in accordance with their authority under separation of power, and there has been respect for the judicial role expressed by both the President of the United States and the majority leader of the Senate. That is enough said on that subject. I had not intended to get into it to any extent, but having heard those comments, I believe it is appropriate to respond. Paul Crotty has a very distinguished academic record. He has a law degree from Cornell Law School, where he was a member of the Order of the Coif. He then clerked for Judge Lloyd MacMahon in the Southern District of New York. He has 35 years of legal experience. He is with the very prestigious New York firm of Donovan Leisure Newton & Irvine. He has had a notable career in public service, having served as a New York City commissioner in two mayoral administrations, first for Ed Koch and later for Rudolf Giuliani. So he worked on both sides of the aisle, Democratic and Republican. He is currently the group president for New York and Connecticut of Verizon Communications. The American Bar Association gave him the highest rating of ``well qualified.'' He has the support of both New York Senators, and he has an excellent record. I see the Senator from New York just arrived. He has already spoken. I do not have to make an act of generosity and give him 2 minutes, which will bring us to 5:30. Mr. President, how much time remains?

Mr. SPECTER

Mr. SPECTER. Mr. President, today I seek recognition to introduce legislation entitled the ``Cotton Shirt Industry Tariff Relief and Technical Corrections Act.'' This legislation will strengthen our domestic dress shirt manufacturers and the pima cotton growers. My bill is a technical correction that levels the playing field by correcting an anomaly from previous trade agreements that has unfairly advantaged foreign producers and sent hundreds of jobs offshore. This legislation reduces duties levied on cotton shirting fabric that is not made in the United States. Currently, U.S. law recognizes this lack of fabric availability and grants special favorable trade concessions to manufacturers in Canada, Mexico, the Caribbean, the Andean region, and Africa. The U.S. has allowed shirts to enter this country duty-free from many other countries, while we have failed to reduce tariffs on those manufacturers that stayed in the U.S. and were forced to compete on these uneven terms. My bill will correct this inequity. This legislation also recognizes the need to creatively promote the U.S. shirting manufacturing and textiles sectors, and does so through the creation of a Cotton Competitiveness grant program, which is funded through a portion of previously collected duties. Our country has experienced an enormous loss of jobs in the manufacturing sector. It is critical that our domestic manufacturers are able to compete on a level playing field. In the case of the domestic dress shirt industry, the problem is our own government imposing a tariff of up to eleven percent upon the import of fabric made from U.S. pima cotton. My legislation is a concrete step that this Congress can take to reduce the hemorrhaging of U.S. manufacturing jobs. One group of beneficiaries of this amendment is a Gitman Brothers factory in Ashland, PA. The Ashland Shirt and Pajama factory was built in 1948 and employs 265 workers. This factory in the Lehigh Valley turns out world class shirts with such labels as Burberry and Saks Fifth Avenue that are shipped across the U.S. Currently, Gitman pays an average tariff of eleven percent on the fabric it imports to make shirts. Their shirts are made of pima cotton that is grown in the Southwestern U.S., but spun into fabric only by special mills in Western Europe. Gitman must compete against Canadian shirt companies that import the same fabric tariff-free and who can then ship their shirts into the U.S. tariff-free under NAFTA. These workers and their families deserve trade laws that do not chase their jobs offshore. This legislation enjoys the support of the domestic shirting industry, UNITE, and the Pima cotton associations. I offer this legislation on behalf of the men and women of the Gitman factory in Ashland, the domestic dress shirting industry, and the pima cotton growers, so that for them free trade will indeed be fair trade as well.

Mr. SPECTER

Mr. SPECTER. Mr. President, today I seek recognition to introduce legislation entitled the ``Cotton Shirt Industry Tariff Relief and Technical Corrections Act.'' This legislation will strengthen our domestic dress shirt manufacturers and the pima cotton growers. My bill is a technical correction that levels the playing field by correcting an anomaly from previous trade agreements that has unfairly advantaged foreign producers and sent hundreds of jobs offshore. This legislation reduces duties levied on cotton shirting fabric that is not made in the United States. Currently, U.S. law recognizes this lack of fabric availability and grants special favorable trade concessions to manufacturers in Canada, Mexico, the Caribbean, the Andean region, and Africa. The U.S. has allowed shirts to enter this country duty-free from many other countries, while we have failed to reduce tariffs on those manufacturers that stayed in the U.S. and were forced to compete on these uneven terms. My bill will correct this inequity. This legislation also recognizes the need to creatively promote the U.S. shirting manufacturing and textiles sectors, and does so through the creation of a Cotton Competitiveness grant program, which is funded through a portion of previously collected duties. Our country has experienced an enormous loss of jobs in the manufacturing sector. It is critical that our domestic manufacturers are able to compete on a level playing field. In the case of the domestic dress shirt industry, the problem is our own government imposing a tariff of up to eleven percent upon the import of fabric made from U.S. pima cotton. My legislation is a concrete step that this Congress can take to reduce the hemorrhaging of U.S. manufacturing jobs. One group of beneficiaries of this amendment is a Gitman Brothers factory in Ashland, PA. The Ashland Shirt and Pajama factory was built in 1948 and employs 265 workers. This factory in the Lehigh Valley turns out world class shirts with such labels as Burberry and Saks Fifth Avenue that are shipped across the U.S. Currently, Gitman pays an average tariff of eleven percent on the fabric it imports to make shirts. Their shirts are made of pima cotton that is grown in the Southwestern U.S., but spun into fabric only by special mills in Western Europe. Gitman must compete against Canadian shirt companies that import the same fabric tariff-free and who can then ship their shirts into the U.S. tariff-free under NAFTA. These workers and their families deserve trade laws that do not chase their jobs offshore. This legislation enjoys the support of the domestic shirting industry, UNITE, and the Pima cotton associations. I offer this legislation on behalf of the men and women of the Gitman factory in Ashland, the domestic dress shirting industry, and the pima cotton growers, so that for them free trade will indeed be fair trade as well.

Mr. SPECTER

Mr. SPECTER. Mr. President, today I rise to introduce the ``Asbestos Standards Enforcement Act.'' This legislation provides for enhanced criminal penalties for willful violations of occupational standards for asbestos. Currently, the Occupational Safety and Health Act provides for criminal sanctions only in those cases where a willful violation of standards results in the death of a worker. This circumstance is not likely to occur when an employer is cited for an asbestos violation, due to the long latency of the disease, and the fact that the Occupational Safety and Health Administration is required to issue citations within six months after inspectors find workplace violations. This legislation would subject employers who willfully violate OSHA asbestos standards to fines at levels set by the Uniform Criminal Code, as well as imprisonment of up to five years, or both. If the conviction is for a violation committed after a first conviction, this legislation would provide punishment by penalties in accordance with the Uniform Criminal Code, imprisonment for not more than ten years, or both. Strong enforcement actions against parties that violate OSHA asbestos rules are necessary to avoid putting workers and the public at risk of asbestos related diseases. I have incorporated these strong measures in my discussion draft of the ``Fairness in Asbestos Injury Resolution Act.'' While that legislation is being considered, there is no reason not to proceed with OSHA legislation that would come before the Senate Health, Education, Labor, and Pension Committee. There are still egregious practices by employers, particularly when it comes to asbestos abatement, that must be stopped. In a recent case, owners of an asbestos removal firm were convicted of exposing hundreds of workers to such high levels of asbestos that many of these workers are almost certain to contract asbestosis, lung cancers, and mesothelioma. Yet this case involved criminal prosecution under environmental laws because the OSHA Act does not contain sufficient authority for criminal prosecution in such cases. In many other asbestos cases, it may not be possible to successfully apply environmental laws to protect workers. The bill I am introducing today would permit criminal prosecution directly under the OSHA Act, the law that is supposed to protect safety and health in the workplace. I urge the Senate to pass this legislation.

Mr. SPECTER. Mr. President, I have sought recognition today to introduce a bill to authorize Federal funding for the rehabilitation of the Benjamin Franklin National Memorial. This memorial, an attraction for some 1 million visitors annually, is truly a national treasure, yet it has come under significant deterioration. The Franklin statue has not been thoroughly cleaned since 1998; there are structural impacts to the statue from changes in temperature and humidity; the lighting and sound systems are obsolete; and the marble walls and stained glass dome are discolored from days when smoking was permitted. The bill that Senator Santorum and I are introducing today will help ensure that Federal funding is made available to preserve and protect our Nation's memorial to Benjamin Franklin, America's distinguished scientist, statesman, inventor, and diplomat. In the 108th Congress, Senator Santorum and I introduced similar legislation to authorize this much needed funding and we were pleased that Senator Domenici, Senator Thomas, and their colleagues on the Senate Committee on Energy and Natural Resources favorably reported an amended version of our legislation to the Senate on September 28, 2004. Subsequently, this legislature passed the Senate on October 10, 2004; however, the limited time available prior to adjournment of the 108th Congress precluded passage of this measure by the House of Representatives. Unlike other national memorials, the Benjamin Franklin National Memorial does not receive an annual allocation of Federal funds to provide for preventative maintenance or other important activities. The significant burden of maintaining this national memorial has become a challenge to the Franklin Institute Science Museum of Philadelphia, Pennsylvania, custodian of the Benjamin Franklin National Memorial. In 1972, The Institute--a non-profit organization--absorbed the sole responsibility for providing the funds necessary to preserve and maintain the memorial when Public Law 92-511 designated the Memorial Hall at The Franklin Institute Science Museum as the Benjamin Franklin National Memorial. In 1973, a Memorandum of Agreement was executed by the U.S. Department of the Interior and the Franklin Institute that directed the Department to cooperate with the Institute in ``all appropriate and mutually agreeable ways in the preservation and presentation of the Benjamin Franklin National Memorial Hall as a national memorial,'' however, the Department has not provided any Federal funding to the Franklin Institute for those purposes other than $300,000 that Senator Santorum and I secured from the ``Save America's Treasures'' program in the Fiscal Year 2000 Interior Appropriations Act to help improve handicap accessibility to the memorial. The Benjamin Franklin National Memorial at the Franklin Institute serves as the Nation's primary location honoring Franklin's life, legacy, and ideals. As we expect visitors to converge on Philadelphia, Pennsylvania from throughout the world for the Benjamin Franklin Tercentenary Celebration beginning in January 2006, it is important that the Franklin Institute, as custodian of the Memorial, begin a meticulous restoration and enhancement promptly. I urge my colleagues to support this legislation to preserve this national tribute to Benjamin Franklin for years to come.

Mr. SPECTER

Mr. SPECTER. Mr. President, today I rise to introduce the ``Asbestos Standards Enforcement Act.'' This legislation provides for enhanced criminal penalties for willful violations of occupational standards for asbestos. Currently, the Occupational Safety and Health Act provides for criminal sanctions only in those cases where a willful violation of standards results in the death of a worker. This circumstance is not likely to occur when an employer is cited for an asbestos violation, due to the long latency of the disease, and the fact that the Occupational Safety and Health Administration is required to issue citations within six months after inspectors find workplace violations. This legislation would subject employers who willfully violate OSHA asbestos standards to fines at levels set by the Uniform Criminal Code, as well as imprisonment of up to five years, or both. If the conviction is for a violation committed after a first conviction, this legislation would provide punishment by penalties in accordance with the Uniform Criminal Code, imprisonment for not more than ten years, or both. Strong enforcement actions against parties that violate OSHA asbestos rules are necessary to avoid putting workers and the public at risk of asbestos related diseases. I have incorporated these strong measures in my discussion draft of the ``Fairness in Asbestos Injury Resolution Act.'' While that legislation is being considered, there is no reason not to proceed with OSHA legislation that would come before the Senate Health, Education, Labor, and Pension Committee. There are still egregious practices by employers, particularly when it comes to asbestos abatement, that must be stopped. In a recent case, owners of an asbestos removal firm were convicted of exposing hundreds of workers to such high levels of asbestos that many of these workers are almost certain to contract asbestosis, lung cancers, and mesothelioma. Yet this case involved criminal prosecution under environmental laws because the OSHA Act does not contain sufficient authority for criminal prosecution in such cases. In many other asbestos cases, it may not be possible to successfully apply environmental laws to protect workers. The bill I am introducing today would permit criminal prosecution directly under the OSHA Act, the law that is supposed to protect safety and health in the workplace. I urge the Senate to pass this legislation.

Mr. SPECTER

Mr. SPECTER. Mr. President, I have sought recognition to inform the Senate of the passing of Jay Cutler on March 4, 2005. Jay was a dear friend to many in Washington, a loving husband, father, and grandfather to his family, and a true asset to Capitol Hill and the field of mental health policy. Both on the Hill and in his role as the lobbyist for the American Psychiatric Association, Jay worked diligently to educate people about mental health and to alleviate the stigma attached to mental illness. I had the pleasure of working closely with Jay on a number of issues affecting millions of Americans afflicted with these maladies. Most importantly, Jay had an overwhelming love for his family, especially his wife, children, and grandchild. They, along with me, the United States Senate and Washington, DC will miss Jay dearly because he was a true inspiration to us all. In memory of Jay Cutler, I ask unanimous consent that Rabbi Joseph B. Meszler's eulogy of Jay be printed in the Congressional Record.

Mr. SPECTER

Mr. SPECTER. Mr. President, I have sought recognition today to introduce a bill to authorize Federal funding for the rehabilitation of the Benjamin Franklin National Memorial. This memorial, an attraction for some 1 million visitors annually, is truly a national treasure, yet it has come under significant deterioration. The Franklin statue has not been thoroughly cleaned since 1998; there are structural impacts to the statue from changes in temperature and humidity; the lighting and sound systems are obsolete; and the marble walls and stained glass dome are discolored from days when smoking was permitted. The bill that Senator Santorum and I are introducing today will help ensure that Federal funding is made available to preserve and protect our Nation's memorial to Benjamin Franklin, America's distinguished scientist, statesman, inventor, and diplomat. In the 108th Congress, Senator Santorum and I introduced similar legislation to authorize this much needed funding and we were pleased that Senator Domenici, Senator Thomas, and their colleagues on the Senate Committee on Energy and Natural Resources favorably reported an amended version of our legislation to the Senate on September 28, 2004. Subsequently, this legislature passed the Senate on October 10, 2004; however, the limited time available prior to adjournment of the 108th Congress precluded passage of this measure by the House of Representatives. Unlike other national memorials, the Benjamin Franklin National Memorial does not receive an annual allocation of Federal funds to provide for preventative maintenance or other important activities. The significant burden of maintaining this national memorial has become a challenge to the Franklin Institute Science Museum of Philadelphia, Pennsylvania, custodian of the Benjamin Franklin National Memorial. In 1972, The Institute--a non-profit organization--absorbed the sole responsibility for providing the funds necessary to preserve and maintain the memorial when Public Law 92-511 designated the Memorial Hall at The Franklin Institute Science Museum as the Benjamin Franklin National Memorial. In 1973, a Memorandum of Agreement was executed by the U.S. Department of the Interior and the Franklin Institute that directed the Department to cooperate with the Institute in ``all appropriate and mutually agreeable ways in the preservation and presentation of the Benjamin Franklin National Memorial Hall as a national memorial,'' however, the Department has not provided any Federal funding to the Franklin Institute for those purposes other than $300,000 that Senator Santorum and I secured from the ``Save America's Treasures'' program in the Fiscal Year 2000 Interior Appropriations Act to help improve handicap accessibility to the memorial. The Benjamin Franklin National Memorial at the Franklin Institute serves as the Nation's primary location honoring Franklin's life, legacy, and ideals. As we expect visitors to converge on Philadelphia, Pennsylvania from throughout the world for the Benjamin Franklin Tercentenary Celebration beginning in January 2006, it is important that the Franklin Institute, as custodian of the Memorial, begin a meticulous restoration and enhancement promptly. I urge my colleagues to support this legislation to preserve this national tribute to Benjamin Franklin for years to come.

Mr. SPECTER

Mr. SPECTER. Mr. President, at the end of March, 2005, Carole Geagley is retiring from the U.S. Senate, and I rise today to pay her tribute. Carole began her Capitol Hill career in 1977 when she began working for the Joint Economic Committee, where she rose to the position of personal assistant to the executive director. Before that Carole was the office manager at the law firm of Seltzer and Suskird, from 1971 to 1977. In 1990 she joined the Senate Appropriations Committee staff. At first Carole worked for the Subcommittee on Agriculture, Rural Development, and Related Agencies. She then made the move to Labor, Health and Human Services, Education, and Related Agencies. As the Senate majority changed over the years she worked for both Senator Harkin and myself, helping manage the seamless transition between chairmanships for more than 15 years. As office administrator Carole has toiled behind the scenes to efficiently prepare many hearings this subcommittee has conducted. She has done everything from letters of invitation to witnesses, preparing background information for hearing books, creating data tables, and maintaining Member requests from Members of the Senate. For the professionalism of her work, she will be missed. Yet it is for Carole's many other attributes that we will miss her the most. The youngest of four siblings, Carole's cheerful disposition, effervescent personality, and her famous cakes have made her the Perle Mesta of the Appropriations Committee. Her cakes and pies are so well known that Tom Harkin, who is quite the chef himself, has asked for her recipes--especially her Coca-Cola cake. It should also be noted that her award-winning cheesecake is featured at a well-known restaurant in her home State of Maryland. Carole has many other talents as well. She and her husband, Ron, are championship bridge players and have played in many national tournaments. In fact, that is how she met Ron, at a bridge tournament in 1975. They were married in 1977 and raised a beautiful daughter, Lori. They are now blessed with three grandchildren who we can all hope will inherit their grandmother's knack at cooking. My best wishes to Carole and her family on this occasion of her retirement.

Mr. SPECTER

Mr. SPECTER. I ask for your support.

Mr. SPECTER. Mr. President, this amendment provides for an additional $1.5 billion for the National Institutes of Health. Unless this funding is provided, more than 400 applications will have to be rejected. In 1972, President Nixon declared war on cancer, and we still have not made sufficient progress. In a budget of $2.6 trillion, $28 billion for NIH is not enough. The amendment also adds $500 million to education which would bring education up to level funding from last year. The Subcommittee for Labor, Health, Human Services, and Education has taken a reduction of $2.2 billion. When you figure in inflation, it adds up to a cut of about $6, $7 billion. Virtually everybody in this Chamber, if not everybody, comes to the subcommittee with special requests for programs and for funding on matters relating to safety, worker safety, health, and education. This is minimal.

Mr. SPECTER. I disagree strongly with my distinguished colleague from New Hampshire. When he says we shouldn't redirect the funds, that is the purpose of this process. That is what the budget resolution is all about. I say, in evaluating the funding for the National Institutes of Health and educational funding, as chairman of the subcommittee which has the appropriations responsibility, and having had a decade of experience there and 24 years experience on the subcommittee, that I am in a position to make an evaluation that may be preferable to the evaluation of the Budget Committee. But that is what this resolution is about. That is the purpose of Senators offering amendments. When the Senator from New Hampshire talks about the funding which the President has increased in the past, I point out that a good bit of that has come from the Congress. And when you are looking at a budget for education in excess of $54 billion, if you figure the inflation cut, that is about $1.5 billion, and besides that, the level of funding is not even present. We have more than $500 million left from last year, an aggregate in education of $2 billion. Considering education is a major capital asset in this country, that is not an appropriate allocation of resources in the opinion of this Senator. I think to add $500 million to the education budget is modest. When you talk about the Pell grants, that is a complicated matter, but it does not help the tremendous number of programs that have been cut. If I might have a brief discussion with the distinguished Senator from Wyoming on a couple of points which were made, when he says there is no cut in NIH, I respectfully disagree. When you have biomedical research up 3.5 percent on $28 billion, what you have is a cut of $980 million, almost $1 billion. There was a modest increase, $145 million, so NIH is short in real dollars by $835 million. So I say it is not a matter of no increase, it is a matter of a cut. The one question I have to ask my distinguished colleague is, on the Perkins vocational grants, he pointed out that it was a 99-to-0 vote. He voted for it as did I. And I agree totally with what the Senator from Wyoming has said, that it is ``absolutely essential'' to have career and vocational training, and if you don't there will be an ``increase in the dropout rate.'' But the budget which has been submitted by the education department of my subcommittee zeros out the Perkins grant. How can we reconcile the importance of the Perkins educational grant and eliminate the funding?

Mr. SPECTER. Mr. President, I should be able to conclude and save some of that 7 minutes.

Mr. SPECTER. Mr. President, the Senator from Wyoming does the best he can with his argument, but the difficulty is that when the subcommittee's budget has been cut from $143.5 billion to $141.3 billion, we don't have room to make reallocations. We just do not have the room. If you take a look at a 3-percent inflation rate, that would be about another $4 billion. So what we are left with is a $6 billion shortfall. This is just illustrative of the Perkins programs which is a very important program. I agree with the Senator from Wyoming, it is a very important program, but one of many very important programs which are being eliminated. That is why I say to my colleagues I have come here modestly asking for $500 million for education, and very modestly in asking for $1.5 million for the National Institutes of Health so we can win the war on sickness. I ask unanimous consent Senator Harkin be added as a cosponsor to this amendment. Senator Harkin has other commitments, but had he been here he would have offered superb arguments at decibel levels substantially higher than that which has taken place here today. If the Senator from Wyoming is prepared to yield back his remaining time, I am prepared to do the same and that would conclude the presentation on this amendment.

Mr. SPECTER. I ask for the yeas and nays on the amendment.

Mr. SPECTER. I yield.

Mr. SPECTER. I thank the Senator from North Dakota. I think we can do that. I have 8 minutes remaining. There is 22 minutes in opposition. My speculation is that neither of us will use all of our time. I do not want to make a commitment to the other side on that, then, in advance, but probably no later than 10:20, 10:25, we can return to the Senator from North Dakota for his presentation, taking time off the bill. Mr. President, I ask unanimous consent we follow that procedure.

Mr. SPECTER. This is a procedural question, not a substantive question. I thank the Senator from North Dakota. On the scheduling of business, I have to chair an Appropriations subcommittee hearing on Health and Human Services at 10:30. We scheduled this amendment at 9:30. I wonder if I could prevail upon the Senator from North Dakota to permit Senator Enzi to respond to my arguments so that I can finish, conclude, and then ask unanimous consent, if that is agreeable, that you be recognized to continue your presentation?