Craig Thomas

Mr. THOMAS

Mr. THOMAS. Mr. President, I would like to announce for the information of the Senate and the public that an oversight hearing has been scheduled before the Subcommittee on National Parks, Historic Preservation and Recreation of the Committee on Energy and Natural Resources. The hearing will take place on Thursday, July 24, 1997, at 2 p.m., in room SD-366 of the Dirksen Senate Office Building in Washington, DC. The purpose of this hearing is to review the process by which the National Park Service determines the suitability and feasibility of new areas to be added to the National Park System, and to examine the criteria used to determine national significance. Because of the limited time available for the hearing, witnesses may testify by invitation only. However, those wishing to submit written testimony for the hearing record should send two copies of their testimony to the Subcommittee on National Parks, Historic Preservation and Recreation, Committee on Energy and Natural Resources, U.S. Senate, 364 Dirksen Senate Office Building, Washington, DC 20510-6150. For further information, please contact Jim O'Toole of the Subcommittee staff at (202) 224-5161. Committee on Energy and Natural Resources--Subcommittee on National Parks, Historic Preservation and Recreation

Mr. THOMAS. Mr. President, I would like to announce for the information of the Senate and the public that an oversight hearing has been scheduled before the Subcommittee on National Parks, Historic Preservation and Recreation of the Committee on Energy and Natural Resources. The hearing will take place on Wednesday, July 30, 1997, at 2 p.m., in room DS-366 of the Dirksen Senate Office Building in Washington, DC. The purpose of this hearing is to review the management and operations of concession programs within the National Park System. Because of the limited time available for the hearing, witnesses may testify by invitation only. However, those wishing to submit written testimony for the hearing record should send two copies of their testimony to the Subcommittee on National Parks, Historic Preservation and Recreation, Committee on Energy and Natural Resources, U.S. Senate, 364 Dirksen Senate Office Building, Washington, DC 20510-6150. For further information, please contact Jim O'Toole of the Subcommittee staff at (202) 224-5161.

Mr. THOMAS

Mr. THOMAS. For the information of all Senators, the cloture vote earlier scheduled at 2:15 will now occur at 3 p.m. Thank you, Mr. President.

Mr. THOMAS. Mr. President, may I first, in behalf of the leader, ask unanimous consent that the previously ordered cloture vote now occur at 3 p.m. today.

Mr. THOMAS

Mr. THOMAS. Mr. President, I think it is interesting that new Members, such as the Senator from Nebraska, who come from the private sector come here and feel very passionate about this and come more recently talking in behalf of people who are paying taxes. That is great. I appreciate it. Another Senator who has worked most diligently on tax relief since he has been in the Senate is the Senator from Minnesota. I yield 5 minutes to him.

Mr. THOMAS. Mr. President, I want to take this time--and I am sure some of my colleagues will join me--to talk a little bit about one of the items that has been before us and will continue to be before us that I think is probably the premier legislature, and that is tax relief. I hope, as we move toward the conference committee agreement and as we move toward voting again in the Senate and in the House on tax relief, that we will keep in mind the big picture; the idea that American taxpayers are working harder than ever before, and the concept and the fact that the typical family is now paying more in taxes than they do for food, shelter, and clothing. Too many families have to rely on two incomes, partially because of the burden of taxes. The typical worker faces nearly 3 hours of an 8-hour day to pay their taxes. So that is what we are talking about. Of course, it is appropriate to talk about and of course it is appropriate to debate how this tax relief is designed. But we ought to keep in mind that we are talking about for the first time in 10 years significant reductions in taxes-- tax relief for American families. What are we talking about? First of all, a child tax credit; $500 per child tax credit, so the families can use their own money to spend in their own way to support their own children. We are talking about educational tax incentives; tax credits so that tuition for higher education can be offset with tax credits. We are talking about the reduction so that families can send their kids to college. We are talking about retirement savings; IRA's to encourage savings to cause people to prepare for their old age, to be able to put away money and have incentive to do that by the incentive of providing for tax-free savings. Capital gains reduction; taxes on capital gains to be reduced in order to encourage investment so that we could create jobs and so we create an economy that is healthy and robust. Estate and gift tax relief. I happen to come from a State where there are a large number of small businesses, where we have lots of farmers and ranches, and families work their entire lives to put together a business or put together a farm or ranch, and when the time comes when there is a death in the family, they often have to sell these assets to pay 50 percent in taxes. That ought to be changed. So I hope we can focus on those things that are beneficial and those things that are useful. I hope we don't allow this idea to be politicized. I hope we don't allow ourselves to enter into this political class conflict which, frankly, the administration is moving toward. I was disappointed that the Secretary of the Treasury has gotten into sort of political class warfare. It seems to me if there is one office in the Cabinet that ought to be one that you can sort of depend on for facts, that it ought to be the person who is in charge of monetary policy, who is in charge of our money. Unfortunately, that has not been the case. I hope that it changes. The idea that some opposition, those who really do not want tax relief has been to make it a class warfare thing. And indeed it isn't. According to Robert Novak, in his article, economist Gary Robbins showed that 75 percent of the tax cuts go to people who make $57,000 or less in adjusted income. I think that is interesting. Those are the people who pay 38 percent of the total taxes. Taxpayers who get more than $200,000 in income would get but one dime of relief for every $100 in total taxes. This is not a tax break for the rich. Interestingly enough, in the same article he indicates--this is a congressional Joint Economic Committee using Treasury data--that the upper fifth of income now pays 63 percent of all income taxes. After the proposed tax cuts, the figure remains exactly 63 percent. Similarly, the share paid by the bottom two-fifths of the income earners remains unchanged. This is not a tax break for the rich. We will hear some things about the tax cuts for the rich. Actually, 75 percent of the taxes, as I said, go to families who make less than $75,000. Families with two kids making $30,000 a year, their tax bill will be cut in half; less than half. So, Mr. President, we have the first opportunity since early in the 1980's to have some tax relief for people who are heavily burdened with taxes. If in fact the era of big Government is over, then we need to have big taxes to be over as well. We have the highest percentage of gross national product paid now in taxes in history --the highest percentage. So, as we move away from big Government, we ought to allow American families to spend more of their own money. Mr. President, I yield to my friend from Nebraska.

Mr. THOMAS

Mr. THOMAS. Thank you, Mr. President. Today following morning business, the Senate will resume consideration of S. 936, the defense authorization bill. As previously ordered, from 12:30 until 2:15 p.m., the Senate will stand in recess for the weekly policy luncheons. At 2:15, the Senate will proceed to a cloture vote on the defense authorization bill. The majority leader is hopeful that cloture can be invoked so that the Senate can complete action on the defense bill this week. As a reminder, Senators have until 12:30 today to file second-degree amendments on the defense bill. On behalf of the majority leader, I remind all Senators that we are now in a busy legislative period prior to the August recess. The appropriations process has begun and Senators should now expect rollcall votes occurring Monday through Friday of each week. I thank my colleagues for their attention.

Mr. THOMAS

Mr. THOMAS. Mr. President, reserving the right to object, what is the time allocation?

Mr. THOMAS

Mr. THOMAS. Mr. President, I think we have 30 minutes set aside.

Mr. THOMAS. Thank you, Mr. President.

Mr. THOMAS

Mr. THOMAS. Mr. President, I thank the chairman for the time. Amendment No. 518

Mr. THOMAS. Mr. President, I wanted to talk very briefly about an issue that is before the body with regard to an amendment on mining law reform. First, let me just say very briefly that I am delighted that this debate is going on. I am delighted that we are talking about tax relief for the first time really seriously in 10 years. We are going to hear a lot about different kinds of details. We will hear a lot of different views, and that is healthy. That is the way it ought to be. There are many here who do not support tax relief. I understand that. It is a legitimate point of view--not one I share--of those who do not want tax relief but would rather have more Government spending. We have not had tax relief since the early 1980's. It is time we do that. I certainly want to congratulate the chairman of the Finance Committee for bringing this package forward. It is time that we gave some relief to working families, and relieve people who are paying taxes and allow families to keep more of their own money. That is what it is all about. We hear people say, ``Well, there shouldn't be tax relief because we need to balance the budget.'' Their notion is that you have to balance the budget and continue to spend more. But what we ought to be doing is controlling spending. And that is part of what this package does. We heard earlier in the evening debate about mining. I wanted to talk just a bit about two aspects of that. One is there is an amendment, of course, which would eliminate the depletion allowance for hard-rock mining. However, in the presentation we heard more about the mining law of 1872 than we did about the depletion. Let me tell you that we would have a revised mining law of 1872 if we could get some of those who constantly complain about it to agree to something. I have been here in the House, and now in the Senate for 2 years. We have had this every year. We have been very close to having a decision. But the very folks who complain the most about not revising it are the ones who never find anything to agree to. I can tell you that there has been agreement on the idea of having royalties from the users, from the producers, and from nearly everyone here. There has been agreement on the idea of paying marketplace price for the land, or in fact not taking title to the land. That could well be done. And I would suggest that those who complain the most about change are the ones that cause it not to happen. I simply want to say that when you want to start talking about depletion allowance and talking about the fact that the minerals are there and free, I want to tell you that they are not free. They are not doing you much good unless there is a substantial kind of investment to extract those minerals--probably as much as $400,000 or $500,000 to be able to do it at all. The value of the resource is not there unless someone has an incentive to invest the money to do the mining. And then, of course, the idea is to create jobs. The idea is to create jobs. Some 2,300 jobs in Nevada--high-paying jobs in the neighborhood of $50,000 a year as compared to $25,000 as a national average. These are the kind of jobs that are there. With tremendous investment in these kinds of jobs there is revenue. There are taxes, and there is payment. We ought to encourage that rather than discourage it. The suggestion was made that somehow mining goes on and there is no reclamation of land. That is not true. There were in earlier years a lack of reclamation laws but there are not now. There are tons of laws that cause reclamation. So, Mr. President, I do not want to go on forever. But I do want to tell you that mining is one of the basic industries in this country-- that minerals are relatively valueless unless there is someone willing to make the investment to extract them. They create some of the highest-paying jobs in this country. They generate local taxes. They generate taxes through wages. And they are very much part of our economy--an economy that tends to be forced out of this country by continuing to raise taxes. I suspect this issue is not a proper one to have there. But it is one we are talking about, and voting on in the morning. I urge my associates here in the Senate to vote against the Bumpers proposal. Mr. President, I yield the floor. Mr. ALLARD addressed the Chair.

Mr. THOMAS

Mr. THOMAS. Mr. President, I just want to say the three of us here, and probably whoever else joins us, have not been in the Senate very long, a couple of years. Most of us came in 1994. I want to say I am very proud of what has happened in these last 2 years, not because of us entirely, but we have been here to see a substantial change in the direction that this Congress has taken. One of the reasons has been people coming, I think, in real close contact with the folks at home who want to see some change, who want to see some change in the Tax Code, who really have been able to communicate the needs that have to take place if we are going to realize the successes that we want. So I have been very proud of the commitment of the freshman and the sophomore class in this place over the last couple of years. We hope to continue to do that, and one of the areas is the size of government, the cost of government, the opportunity for people to keep the money that they have earned. We are pleased to be a part of that. One of the persons who has been very effective in doing that over these 2 years is the Senator from Arizona. I am delighted he is here to join us this morning. I yield the floor to Senator Kyl.

Mr. THOMAS. Mr. President, we do want to talk this morning, however, about an item of great importance to all of us--the citizens and to all of us as Members of the Senate--and that is taxation, the question that will be before the Senate this week, as the Finance Committee has completed their work on the reconciliation bill, and we will now be addressing that. We will be talking about tax relief, which I suspect is perhaps one of the most important topics we will talk about this entire year, not only because of the tax aspect of it because, as you go into the budget process, it seems to me that budgets are much more than just numbers, they are much more than various spending proposals, they sort of set the parameters of what we will be doing in Government for at least the coming year; in this case, at least 5 years. These decisions will frame the size of the Government over time. If you prefer smaller governments or larger governments--I happen to prefer smaller ones--the budget has to do with that. The budget has to do with the kinds of priorities that we will set among programs, among the kinds of things that we do. Of course, if we are going to be responsible, as we should be, over time to pay for what we want--which we haven't done for 25 years-- and seek to balance the budget, then revenues and expenditures and tax relief are all part of this package, and probably, in the broad sense, are the most important decisions that we will make with respect not only to taxpayers, but program recipients and everyone else over this next 5 years. (Mr. ROBERTS assumed the chair.)

Mr. THOMAS. Mr. President, we are joined by the Senator from Alabama, who is also new here. I yield the remainder of our time to the Senator from Alabama, Senator Sessions.

Mr. THOMAS. So, Mr. President, we will be talking about the taxes that are generally going to be in the reconciliation bill, such as some relief on the cost of education, in terms of deductions, in terms of credits for parents who have youngsters in school. We will be talking also about the family credit, the $500-per-child credit, so that families can retain and then use that money in their own way to raise their children. We will be talking, hopefully, about capital gains tax relief, the idea that investments would not be taxed at as high a level as they have been, the idea of encouraging investments so that we create jobs and so that we strengthen the economy, and capital gains has a good deal to do with that. Hopefully, we will also be talking about estate taxes, the kind of taxes that are levied on property and assets that people have worked their entire life to accumulate and then, in many cases, have to spend more than 50 percent of the value of those assets in taxes and are unable, often, to pass them on to their families. They are particularly important, I think, Mr. President, in areas such as your State of Kansas and my State of Wyoming, where small business and agriculture is very prominent. Often the assets of families, small businessmen, ranchers, farmers, are tied up in fixed assets, such as land and so on, and they have to sell their property in order to pay the taxes. So these are the kinds of decisions with which we will be dealing. I look forward to it, frankly. It has been a very long time, it has been a very long time since we have had a fundamental reduction in taxes. The concept in this place, in this Senate, in this Government, until the last couple of years, is let's have more taxes, let's have more money, let's have more Government, and now we have an opportunity to seek to start to turn that around and, hopefully, over time reduce the size of Government, move more and more functions to the State where they belong and can be best implemented, and then give taxpayers a break. We will be caught up, Mr. President, as we go into this over the next week or more, in great details, as we should be. But I hope we don't forget the concept of what we are seeking to do. We will be caught up in details. We will be caught up in the great political spin that goes on, seemingly has gone on with more fervor in the last year or two than I ever recall. Everything is sort of couched in terms that are designed to package it and sell it. It is not really basic stuff. It is all fluff. We shouldn't do that. For instance, we will hear the idea that every tax reduction is a tax break for the rich. Well, now, that isn't the case. If it is, then there are an awful lot of us who apparently are rich and didn't know it. People at $40,000 get some kind of tax break, and it is termed then as a tax break for the rich. That is not true. We need to talk a little bit about really what the facts are. There is a notion that will be talked about, that, ``Well, we don't need any tax reductions, we need to keep the revenue coming so we can continue to spend and spend more,'' and that has been the philosophy. It is not the principle philosophy of this country. The country was to have a constitutional government that does those things that are provided in the Constitution, and those things that are not provided in the Constitution should be done by the States or by the citizens. That is what the Constitution says. Rather than talk about the facts and philosophy of government, we will be talking about political aspects of it. We will be talking about spin. We will be talking about the message that has come over the last months from the White House with the message merchants that are the result of the polling experts. I hope we can cut through that and just talk like we do in Wyoming, frankly. I was there yesterday. Those folks don't spin it, they just say, ``Hey, let's just talk about what it really is,'' and that is what we ought to do here. One of the things we ought to understand as we take a look at taxes and tax burden for working Americans is that it is higher than it has ever been. It, as a matter of fact, represents over 30 percent of GDP-- over 30 of gross domestic product in taxes. I don't think we imagined that that would be the case in this country with limited government. It is three times as high as the highest tax burden during Roosevelt's New Deal--three times as high. So we ought to be talking about some kind of tax changes philosophically. We will talk about income tax relief. That is what we are basically talking about, income tax relief. We are talking about people who pay it. You are not going to get income tax relief unless you pay taxes, and there is this idea that whenever we want to do anything to relieve the burden on those people who pay taxes, that somehow it is a big tax break for the rich. Everybody, of course, wants to help folks who need help to help themselves. That is not the issue here. We are not talking about how you do that. We are not talking about welfare; we are not talking about those kinds of things. We are talking about tax relief. We ought to talk about that. It is very legitimate to talk about helping those who need help, and we should do that and we do that. But we ought not to tie everything together and not be able to clearly look at what we are talking about. We are talking about tax relief. We are talking about tax fairness. We are talking about opportunity. We are talking about encouraging investment to create jobs. Those are the things that we are talking about. Tax relief is designed to allow people who work hard, people who, because they work hard, are successful to keep more of what they earn. We are talking about the incentive to work harder, the incentive to invest, the incentive to invest to strengthen the economy and to create new jobs. That is what we are talking about. So we ought to strip the other stuff away and really think about it a bit. Tax relief is part of, it seems to me, a historical American philosophy of limited government, of allowing people to keep what they earn after they have paid the necessary costs of the services they want from government. That is a philosophy that I think is strong. President Clinton in Denver this weekend boosted, as he should, about this economy, about the growth of a market economy, the growth of a free-enterprise economy, and yet, often the White House ignores the very thing that allows this economy to be stronger than the economies you see around the world, because it is an incentive-driven-private- enterprise-market economy. That is part of what we are talking about when we talk about taxes, when we talk about the level of taxes and when we talk about tax relief. It is tax relief from that 30 percent of GDP that is collected in taxes. Keep that in mind. Every family pays nearly 40 percent of their income in taxes. That is very hard. I am not opposed, nor is anyone I know of opposed, to taxes. If we are going to have a government which is legitimate, if we are going to do the things in government that needs to be done, we have to pay for it. That is what taxes are for. We raise revenues to pay for those legitimate functions of government and, if we are responsible, we will do that. We have not been as responsible as we should have been over the years. When we wanted some programs, when we wanted some services, when we wanted something to be done for us, rather than pay for it, we put it on the old credit card, and the credit card is now maxed out, of course. So you have to pay for it. There is nothing wrong with that. But there is a concept of taxation that I hope we will consider, that I hope we will take a look at. Taxation ought to generally be for the purpose of creating revenues to do the things that we are supposed to do to be responsible in government. Let's pay for it. Unfortunately, over a period of time, it seems to me--and we continue to do that--tax policy is designed as much to influence behavior as it is to raise revenues, so that each tax relief has a great deal of conditions attached. ``If you will do this, then we will give you tax relief.'' ``If you behave in this way, we will give you some tax relief.'' So we have created then a complicated and inefficient and, frankly, unfair tax system which brings about, of course, a great deal of debate about how we simplify the tax system. We are not going to talk about that much this week. That is OK. That is OK. We are dealing with the short term. We are dealing with something we have not talked about for years, and that is tax relief. We ought to do that. And I am pleased with what has been done in the budget. I am pleased with what has been done in the Finance Committee to move in that direction. That is not as far as we ought to go. Our next step then ought to be to take a broader look at how we simplify taxes. I do not have a favorite way of doing it. There are a number out there that are possible, whether they be flat taxes, whether they be sales taxes, whatever. But we ought to do that. We ought to see if we cannot move away from this idea that taxes are designed to impact and direct behavior and get to something that is much more simple, much more collectible, much more less intrusive on people's lives. But, as I said, that is not the issue that will be before us this week. The issue is to seek to get some tax relief for taxpayers in this country. You say, well, that sounds pretty simple. What is so complicated about that? Just listen over this week and you will hear all kinds of things about tax breaks for the rich, about those people do not need it, we should not have tax breaks because we ought to have more programs. And you will see all that, hear that coming from the White House and hear that coming from all over. And so it is not easy. It is not simple. The idea of tax relief, which sounds very simple, is not. Most everyone agrees there ought to be some progressiveness in the tax system. And there is. Today's Code is more progressive than it was in 1950. The lower half of taxpayers pay less than 5 percent in total taxes. And 25 percent of the taxpayers pay 80 percent of the taxes. Those that have over $42,000 in income are in that category. So we do have a progressive tax system. And we should have. And we will continue to. But we ought not to confuse tax relief with all of the other kinds of issues that happen. As I mentioned, the typical family of four forfeits nearly 40 percent of their income, more than they spend on food, shelter and clothing combined. So it is tough. It is tough to raise a family. It is tough to send your kids to school. It is tough to save for retirement. Nearly 3 hours out of every 8-hour workday are spent financing Government--money that is spent on Washington's priorities, not yours. More taxes, more government--that is one of the things that causes us to take a look at how you make government more efficient, that you require more efficiency, makes us take a look at the idea of private contracting rather than having an increased size of government because it is more efficient, because it costs less, but unless you have some reason to do that, the government continues to get larger. So we need to balance the budget, but keep in mind that you can balance the budget by raising revenues, that that is not what we ought to do. We ought to balance the budget while controlling and reducing the size of government. That is the challenge. And that is the challenge that we need to undertake. Unfortunately, we have not balanced our budget. But we now are in a position to do that. We now have a budget in place that will do that over 5 years. We will also allow for some tax relief. And that is what we will be talking about this week. I think there is a considerable amount of history that we ought to take into account. As we do it, we ought to talk about how long it has been since we have talked about tax relief. It has been a number of years. We ought to keep in mind the fact is, over the last several years that the movements in taxes have been simply to raise them. We ought to keep in mind the fact that there are ways to reduce spending. We have accomplished a good deal in the last little over 2 years. We have moved to change welfare from an entitlement. We moved to cause it to be moved back to the States where it can be more effectively handled. We have done something about the entitlement of agriculture and farm programs. The Presiding Officer was the Senator who had the most leadership and impact on the changes in the farm bill. That is a fundamental change that we have made over a period of time. We have talked in the last 2 years, and now, having moved toward essentially balancing the budget--we have not done that for a very long time--this Congress and last year's Congress have caused that movement to where we are now talking about how we balance the budget and when we balance the budget. Prior to that time, there was no talk about balancing the budget. So we have made a lot of progress. We have made a great deal of progress in the last 2\1/2\ years. Does it go fast enough to suit everyone? Of course not. Will this tax bill suit everyone? Of course not. There will be arguments about whether there is enough in there for capital gains. There will be arguments if there is enough in estate taxes. There will be arguments as to why we do not do something else. I had a call from a lady yesterday in Cheyenne who is retired whose home is valued so it already comes under the estate taxes. She says, ``I sent my kids to college and I didn't get a credit.'' She says, ``There's nothing really in there for me much.'' Well, there are a few things. But it is true, it is true, it will not suit everyone. But I say to my colleagues, let us move forward with this great opportunity for the first time in several decades that really makes some meaningful kind of adjustments in tax relief, to pursue the idea that Americans should be able to keep their hard-earned money, to pursue the idea that we ought to reduce the size of government and therefore the demand on taxes, to pursue the idea that being able to keep more of the money that you work for and earn is part of the incentive in this system. So, Mr. President, this will be a very important week, and the week after, when we really decide the direction that we will take on budgets and tax relief and how it will be adjudicated. Mr. President, I am pleased to be joined by my friend and associate from Nebraska. I yield the floor to the Senator from Nebraska.

Mr. THOMAS

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

Mr. THOMAS

Mr. THOMAS. Thank you, Mr. President. Don't be alarmed, I expect to have some of my associates here to share in that time.

Mr. THOMAS

Mr. THOMAS. Mr. President, I ask unanimous consent to speak for 10 minutes.

Mr. THOMAS

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

Mr. THOMAS

Mr. THOMAS. Mr. President, I come to the floor today as chairman of the Senate Subcommittee on East Asia and Pacific Affairs to discuss and formally state my support for the extension this year of most-favored- nation status to the People's Republic of China. I want to stress at the beginning that supporting China MFN is not an issue of approving or disapproving China's behavior. Rather, it is an issue of how we best work to influence that behavior in the future. For several reasons, I do not believe that withholding MFN is an effective tool in doing that. First, I firmly believe that invoking most-favored-nation status would hurt the United States more than the Chinese. It would be the economic equivalent of saying, ``Lift up a rock and drop it on your own foot.'' Simply put, we are talking about American jobs. It is estimated that United States exports to China support around 200,000 American jobs; the Chinese purchases now account for 42 percent of our fertilizer exports and over 10 percent of our grain exports as well. Last year, China bought over $1 billion worth of civilian aircraft, $700 million in telecommunications equipment, $340 million in specialized machinery, and $270 million of heating and cooling equipment. As China's economy continues its dynamic growth, the potential market for increased sales, of course, will grow as well. Our withdrawal of MFN would certainly be met with in-kind retaliation by the Chinese, who are fully capable of shopping elsewhere for their imports, as we have seen with Boeing and Airbus, with resulting harm to America's economy. Second, revoking MFN would have a damaging effect on the economies of our close allies and trading partners Hong Kong and Taiwan. The vast majority of Chinese trade passes through Hong Kong. Putting the brakes on that trade would result in a 32 to 45 percent reduction--around $12 billion worth--of Hong Kong's reexports from the PRC to the United States. In addition, it is estimated that there would be about a $4.4 billion drop in income to Hong Kong, a loss of 86,000 jobs, and a 2.8 reduction in GDP. Moreover, revoking MFN would have the greatest negative impact on the southern China provinces where Hong Kong and Taiwanese businesses have made substantial investments, as well as the United States. But I want to stress this point. It is in these provinces that the political and social changes for the better are occurring. Mr. President, on my last trip to China--my only trip to China--I traveled from Beijing in the north through Shanghai and on to Guangzhou in the south. In Beijing, talks with the Chinese centered solely on politics, Taiwan particularly. The vast majority of the population still ride bicycles. The availability of western goods, while increasing, is limited. The role of the party in the people's daily lives is still significant. But as we traveled further south, I was struck by the change in attitudes and interests. People were much less concerned about politics and ideology and much more concerned about continuing trade, their standard of living, as well as budding democratic freedoms. Western consumer goods are widely available, the minority of people ride bikes, and most instead drive cars and motorcycles. The party apparatus is much less ideologically communistic and more bureaucratic. In my view, there is one cause for these changes, changes in the everyday lives of the average Chinese citizens--commercial contacts with the West, especially the United States. Mr. President, by opening up their economy to market reforms and economic contacts with the rest of the world, the Chinese authorities have let the genie out of the bottle. If we revoke MFN, in effect cutting off trade with China, we only serve to retard this opening-up process, a process that we should be doing in every way to advance and encourage the advancement there. Third, revoking China's MFN status would place it among a small handful of countries to which we do not extend this normal trading status. Most favored nation is a bit of a misnomer. It is actually normal relations. But we exclude that normal relationship with Cuba, Laos, North Korea, Serbia, and Afghanistan. We would be relegating China to this grouping, and I believe it would do irreparable harm to our bilateral relationship and to the security and stability of East Asia as a whole. China is very attuned to the concept of face. Placing it on the same level as the world's most outcast nations, while perhaps not undeserving in some fields, would needlessly provoke a backlash from the Chinese which would frost over whatever strides we have made in the past. Now, I want to make it clear that I in no way condone the policies of the Chinese nor the actions. I am by no means an apologist for the PRC nor a proponent of foreign policy solely for the sake of business interests. No one can argue that China's actions in many fields do not deserve some serious response from us. The PRC has, at best, a sad, sad human rights record. It imprisons prodemocracy dissidents. It has done so in such numbers since the Tiananmen Square incident that there are no active dissidents. It prosecutes religious minorities, including Christians, focusing most harshly on the Buddhists in Tibet where it has closed monasteries and jailed monks and nuns. And it persecutes ethnic minorities, concentrating their attention recently on the Tibetans. The PRC consistently fails to live up to the terms of its trade agreements with us, especially in the areas of trade barriers and intellectual property rights. It has taken two separate agreements and several years to get intellectual property rights moving in the proper direction, but they are still not doing what they are supposed to do. It has made several decisions which call into question its commitments to preserving democracy in Hong Kong, including the most recent round involving the so-called Provisional Legislature. It ignores its commitments to some international agreements. So all in all, it is not a good situation. The question of course is, how do we best deal with that? Mr. President, I am the first to insist that we need to address these serious issues, but it is clear that our current China policy, which the administration characterizes as constructive engagement but has recently retooled as multifaceted is not up to the task. The Chinese will continue to walk over us as long as their actions meet with little or no credible repercussions. But while we need to make some response, it is equally clear to me that most favored nation is not going to solve any of these problems. As I have mentioned, its revocation would only cause more problems than it solves. Moreover, threatening MFN withdrawal has come to be hollow and meaningless. We know it and the Chinese know it. It is like watching a movie you have seen several times before; you know the plot, you know the actors, you know their roles and the dialogue, and indeed you know the outcome all before the movie even starts. With each cry of wolf we make by threatening to withdraw most-favored-nation status and then do not, the credibility of an already tenuous threat declines. Yet, without a responsible alternative, Members of Congress are forced to face the Hobson's choice between voting to revoke MFN or doing nothing. Many, with no constructive way to vent their policy frustrations, choose revocation. I am convinced it is time to rethink the United States-China policy and come up with a workable way to get China to act as a responsible member of the international community and to live up both to the letter and the spirit of the agreements they have reached with us. In addition, I believe the United States has to be more prepared to say what it means and mean what it says. On March 22, in my subcommittee, we held a hearing on exactly this topic. It was the opinion of every panelist, save one, that we need a workable alternative to most-favored-nation as a tool of American foreign policy. I hope that in the next year policymakers, both in the Government and outside it, can recognize that the old policy has failed and move on to try and formulate a new one. It will not be a quick or simple process, but the sooner it begins the better off we will be and the better for the health of our bilateral relationship. In closing, Mr. President, let me reiterate that I strongly support most-favored-nation renewal. But at the same time, I equally strongly urge this administration to pursue a clear, more consistent and effective foreign policy towards China. Frankly, the latter will do more toward setting our countries down the path of a strong relationship. I yield the floor. Mr. HUTCHINSON addressed the Chair.

Mr. THOMAS

Mr. THOMAS. Mr. President, I would like to announce for the public that a field hearing has been scheduled before the Subcommittee on National Parks, Historic Preservation, and Recreation of the Committee on Energy and Natural Resources. The hearing will take place Thursday, July 3, 1997 at 9:30 a.m. in the Ceremonial Courtroom #1 of the Federal Courthouse, 200 NW 4th Street, Oklahoma City, OK 73102. The purpose of this hearing is to receive testimony on S. 871, a bill to establish the Oklahoma City National Memorial as a unit of the National Park System; to designate the Oklahoma City Memorial Trust, and for other purposes. The Subcommittee will invite witnesses representing a cross-section of views and organizations to testify at the hearing. Every attempt will be made to accommodate as many witnesses as possible, while ensuring that all views are represented. Witnesses invited to testify are requested to bring 10 copies of their testimony with them to the hearing, it is not necessary to submit any testimony in advance. Statements may also be submitted for inclusion in the hearing record. Those wishing to submit written testimony should send two copies of their testimony to the attention of Jim O'Toole, Subcommittee on National Parks, Historic Preservation, and Recreation, Committee on Energy and Natural Resources, United States Senate, 354 Dirksen Senate Office Building, Washington, DC 20510. For further information, please contact Jim O'Toole of the subcommittee staff at (202) 224-5161.

Mr. THOMAS

Mr. THOMAS. Mr. President, I claim the time we had to talk about how to get this job done. We have talked for some time about the need. Now the question is, how do we now find a vehicle to get that done? That is what we ought to be spending our time talking about. Let me yield to my friend, the Senator from Colorado.

Mr. THOMAS

Mr. THOMAS. Madam President, we have asked to set aside a little time this morning to talk about the issue the Senator from Minnesota talks about. Each of us wants to find a way to get help to people who need it as a result of the disaster. I think there are a number of issues involved. I believe as we move toward a solution, it is useful to talk about those things. Certainly, there are legitimate concerns on both sides of this bill. I am satisfied that our leadership is now putting together something that will be presented, hopefully that will be acceptable. I think it is well to recognize that we want to get this disaster aid out, but there are certain things that are very important, as in any discussion, to both sides. One of them is to get something in that avoids the human disaster that might well happen in the future if we had another shutdown of the Government. So this can be one of those things. There also has to be an understanding, of course, on an issue of where there are different points of view that both sides have to be willing to make some accommodation. The idea that somehow you can't do anything unless the President approves is not the system we have here. We have a divided Government. We have the President with authority to do what he does and the Congress with the authority to do what they do. When they come to a conflict, there has to be some movement and not simply a pronouncement that the President doesn't like that and, therefore, it won't happen. That is not the way it works. So, Madam President, we would like to talk a little bit about that. I am joined by my colleagues. I yield first to the Senator from Minnesota.

Mr. THOMAS

Mr. THOMAS. Mr. President, I object to further proceeding on either of these bills at this time.