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The Budget

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Date:
Location: Washington, DC

THE BUDGET

Madam President, the President's budget that was submitted today, which is really the declaration by the administration with regards to defense and national security, but also is extraordinarily important in terms of health policy and education. There is probably not a more important document that is submitted by any President than the budget item indicating a nation's priorities.
So that is why I wanted to be able to just take a few moments on one particular aspect of it, and that is the state of our economy and how this budget addresses the state of that economy or how it failed to do so.

I just wanted to share with the Senate the strong sense that we are in a jobless recovery. This economy may be fine for Wall Street, but it is bad for Main Street. I have certainly seen that in the last weeks or months that I have had a chance to get around this country. I saw it up in the State of New Hampshire, where every new job is paying 35 percent less than the jobs that had disappeared. I saw that down in New Mexico, where you still have 78,000 workers who are waiting for an increase in the minimum wage and the new jobs are paying 23 percent less.

It is the same in Arizona, in Michigan, in South Carolina, and across the country. South Carolina has lost tens of thousands of jobs. So I was interested about what is in this budget, or what would fail to be in this budget, with regard to American workers.
One of the principal concerns that I find from families while traveling across this country is the failure of the Senate to respond to the problems of those who are unemployed with the extension of the unemployment insurance. There are 90,000 workers a week who are losing their unemployment compensation. There is virtually nothing in this legislation that deals with that. The unemployment compensation fund has nearly $20 billion.

The proposal that has been offered by Senator Cantwell and others would provide for some 13 weeks of unemployment compensation. It has been rejected by the other side more than 12 different times.

Look at this chart. It shows the average number of out-of-work Americans who are running out of unemployment benefits and not finding jobs. The average monthly rate from 1973 to 2003 was 150,000. The estimate for January 2004 is 375,000. And there is not one word in here to recommend that we have a temporary extension of unemployment compensation.

These are all hard-working Americans. They are not eligible for the unemployment compensation fund unless they have paid into it. They have paid into it. And we are finding objection from the other side to providing some relief for these workers. I can't believe that.

Second, I ask unanimous consent to have printed in the RECORD a New York Times editorial from Friday that makes this very point I have just made. I will quote part of it.

The pernicious joblessness bedeviling the nation is spawning a new category of Americans dubbed "exhaustees"; the hundreds of thousands of hard-core unemployed who have run through State and Federal unemployment aid. According to the latest estimates, close to 2 million Americans, futilely hunting for work while scrambling for economic sustenance, will join the ranks of exhaustees in the next six months. They represent a record flood of unemployed individuals with expired benefits-the highest in 30 years-who are plainly desperate for help.

The emergency program cries out for immediate renewal.

I ask unanimous consent that full editorial be printed in the RECORD.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

[From the New York Times, Jan. 30, 2004]

EXHAUSTING FEDERAL COMPASSION

The pernicious joblessness bedeviling the nation is spawning a new category of Americans dubbed "exhaustees": the hundreds of thousands of hard-core unemployed who have run through state and federal unemployment aid. According to the latest estimates, close to two million Americans, futilely hunting for work while scrambling for economic sustenance, will join the ranks of exhaustees in the next six months. They represent a record flood of unemployed individuals with expired benefits-the highest in 30 years-who are plainly desperate for help.

President Bush and the Republican-controlled Congress are doing nothing to help these people. Washington showed no qualms last month in allowing the expiration of the emergency federal program that had offered an extra 13 weeks of help to those who exhausted state benefits. Historically, such help has been continued in periods of continuing job shortages.

A year ago, the aid was extended an extra year by Republican leaders. But now, the G.O.P.'s election-year talk is of a recovery rooted in the tax cuts weighted for affluent America. Tending to the exhaustees clearly mars that message.

The emergency program cries out for immediate renewal. It costs $1 billion a month, money that is available from the federal unemployment fund.

In January alone, 375,000 unemployed people are running out of state benefits with nothing to help them through to spring, according to estimates of new federal data by the Center on Budget and Policy Priorities, a capital watchdog group. Without action, the exhaustee toll will mount.

Many will slip into the limbo of the more than 1.5 million Americans who have given up looking for work in the inert employment market. These amount to the flatliners, industrious people overlooked on the administration's screen of spiking recovery indexes.

Mr. KENNEDY. Madam President, I also want to mention one other item that is included by reference. That is the item of the President talking about his overtime provisions.

Again, he has indicated his support on the overtime provisions that will effectively eliminate overtime coverage for 8 million Americans-primarily firefighters, policemen, and nurses, who are the backbone for homeland security.

I have said here a number of times that I was not only strongly objecting to the administration's proposal but I particularly object to the inclusion in the administration's proposal that talked about training in the Armed Forces which can make a worker overtime ineligible. That, I thought, was the cruelest part of the proposal.

We have American service men and women who are in Iraq, in combat, or in the National Guard and Reserve. Many of them will be coming right back and will return to the civilian job market. Yet if they are going to have the training in the Armed Forces, they could be ineligible for overtime. I have said that before on the floor of the Senate.

My good friend Secretary Chao-and I see the former Secretary of Labor presiding over the Senate-wrote a letter to Speaker DENNIS HASTERT. She pointed out we shouldn't worry about the fact of the military.

I ask unanimous consent that the letter be printed in the RECORD.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

SECRETARY OF LABOR,
Washington, DC, January 27, 2004.

Hon. J. DENNIS HASTERT,
Speaker of the House of Representatives,
Washington, DC.

DEAR MR. SPEAKER: I write to provide you with the facts to correct the record following last week's Senate floor debate on the Consolidated Appropriations Act with regard to the Department of Labor's proposed revision of the Fair Labor Standard Act's overtime exemption regulations. I also would like to thank you for your support and leadership on the important issue.
The recent allegations that military personnel and veterans will lose overtime pay, because of proposed clarifications of the Fair Labor Standards Act (FLSA) "white-collar" exemption regulations, are incorrect and harmful to the morale of veterans and of American servicemen and women. I want to assure you that military personnel and veterans are not affected by these proposed rules by virtue of their military duties or training.

First, the Part 541 "white collar exemptions" do not apply to the military. They cover only the civilian workforce.
Second, nothing in the current or proposed regulation makes any mention of veteran status. Despite claims that military training would make veterans ineligible for overtime pay, members of Congress should be clear that the Department of Labor's proposed rules will not strip any veteran of overtime eligibility.

This has been one of many criticisms intended to confuse and frighten workers about our proposal to revise the badly outdated regulations under the FLSA "white collar" exemption regulations. It is disheartening that the debate over modernizing these regulations to meet the needs of the 21st Century workforce has largely ignored the broad consensus that this rule needs substantial revision to strengthen overtime protections.

The growing ambiguities caused by time and workplace advancements have made both employers' compliance with this rule and employees' understanding of their rights increasingly difficult. More and more, employees must resort to class action lawsuits to recover their overtime pay. These workers must wait several years to have their cases adjudicated in order to get the overtime they have already earned. In fact, litigation over these rules drains nearly $2 billion a year from the economy, costing jobs and better pay.

I hope that this latest concern will be put to rest immediately. Once again, I assure you that military duties and training or veteran status have no bearing on overtime eligibility. We hope that future debate on this important provision is more constructive. If we can provide further assistance in setting the record straight, we would be pleased to do so. The Office of Management and Budget has advised that there is no objection from the standpoint of the Administration's program to the presentation of this report.

Sincerely,

ELAINE L. CHAO.

Mr. KENNEDY. Madam President, let me quote a couple of parts of it. This is the letter to the Speaker by Secretary Chao stating "that military personnel and veterans are not affected by these proposed rules by virtue of their military duties or training."

That is what she says.

However:

Proposed section 541.301(d) states that "training in the armed forces" can make a worker an overtime ineligible.

This is new language. It is not in the current regulations. The only purpose is to take away overtime for veterans. Either it is in there or it is not in there. It happens to be in the regulation.

She states:

First, Part 541 "white collar exemptions" do not apply to the military. They cover only the civilian workforce.

No one is claiming that the rule affects the military force. The issue is the veterans who leave the military to work in the civilian workforce would lose overtime protections because they have had training in the Armed Forces. Then it goes on:

Second, nothing in the current or proposed regulation makes any mention of veterans status.

No. But the proposed regulation, for the first time, addresses "training in the armed forces." Veterans who work in the civilian workforce who typically have received such training.

It isn't the people who are in the military. We agree with that. It is after they get out that they are going to be subject to this. If they don't want it in, they ought to have another rule that eliminates that.

I want to bring to the Senate's attention the understanding of the National Association of Manufacturers.

Bush overtime proposal denies overtime to veterans.

The overtime proposal explicitly states that training in the armed forces can disqualify workers from overtime protection. Many employer groups encourage the Bush administration to deny overtime protection to more categories of work, such as veterans.

Look at these comments from the National Association of Manufacturers.

NAM applauds the department for including this alternative means of establishing that an employee has the knowledge required for the exemption from overtime protection to apply. For example, many people who come out of the military have the significant knowledge based on work experience.

There it is. Veterans who go in and have that specialized training which is so necessary not only for their security but the security of their squad members or their company members, their platoon, or whatever it might be, they get that. When they come back as a member of the National Guard and return to the civilian workforce, bang, zippo, their employer comes up and says, This is what the rule is. This is what the regulation is, the letter from the Secretary notwithstanding.

We are going to make an effort to eliminate that whole overtime rule because we do not believe the men and women who are the heart and soul of homeland security, who are the firefighters, police, nurses, and others ought to be carved out from overtime protections. There are many problems with our economy today, but one of them is not that our firefighters and policemen and nurses are getting paid too much.

The PRESIDING OFFICER. The Senator has 30 seconds remaining.

Mr. KENNEDY. I thank my friend. I will take time at another time to go through the various provisions of the budget dealing with education and health. I think it is important that the American people understand exactly what those provisions do and don't do for the American people.

I thank the floor manager.

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