American Jobs Creation Act of 2004 - Conference Report

SIONAL RECORD
SENATE
Oct. 10, 2004

AMERICAN JOBS CREATION ACT OF 2004-CONFERENCE REPORT

Mr. SANTORUM. Mr. President, I wonder if the distinguished chairman of the Finance Committee might respond to a colloquy. I specifically have a question about the formula used to calculate the financial statement limitation for computing the amount of permanently reinvested earnings eligible for repatriation.

Mr. GRASSLEY. I would be glad to entertain a question from the Senator from Pennsylvania.

Mr. SANTORUM. I believe the purpose of this provision is to determine the amount of permanently reinvested earnings eligible for repatriation in the case in which a company discloses in its applicable financial statements the incremental amount of U.S. tax that would be due on such permanently reinvested earnings if they were repatriated, rather than stating the actual amount of such earnings.

Mr. GRASSLEY. That seems to be an accurate interpretation.

Mr. SANTORUM. It would appear that the formula assumes that the incremental tax so disclosed would be at the full U.S. tax rate of 35 percent. Is it not correct that the amount of U.S. tax disclosed would instead be a lesser amount that takes into account the amount of foreign taxes already imposed with respect to such earnings?

Mr. GRASSLEY. As I read the statute, a 35 percent rate is assumed to apply only when a financial statement fails to show earnings permanently invested outside the U.S. but also includes an amount of tax liability attributable to such earnings. I believe that the formula is intended to produce an amount comparable to what would have been shown if the amount of earnings permanently invested offshore had been set forth on the financial statements. One shortcoming of the formula, which you have identified, is that the financial statements only take into account the incremental U.S. tax liability that would be incurred if the company repatriates its earnings, which would be the 35 percent rate reduced by any foreign tax credits. I think you raise a very good point that Congress should revisit in the future. In the meantime, I encourage the Department of Treasury to consider issuing guidance that permits taxpayers to more accurately reflect the actual amount of earnings permanently invested offshore.

Mr. SANTORUM. I thank the Senator for his insights.

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Mr. SANTORUM. Mr. President, I rise to say how disappointed I am that we are holding back vitally important pieces of legislation in the Senate for in some respects-I understand the political shows that we all put on before elections. I understand that. But we are holding back money from States such as Pennsylvania, Louisiana, Florida, and others that right now need resources to help recover from the hurricanes that hit us in the eastern part of the United States. We have individuals-not just one, now two-who are holding us from passing that legislation to get those needed resources the Senator from Alaska suggested are vitally needed for FEMA now to get those resources to people who need it now.

I was on the phone the day before yesterday with my Governor. We were talking about the concern over the shortage of funds, the concern about the ability for FEMA to respond and get some of these businesses affected by floods in Pennsylvania up and going. The bill we have here on the floor right now, we could pass it right now and get this money into the hands of people in Pennsylvania, North Carolina, South Carolina, Georgia, Louisiana, Alabama, Mississippi, Florida, and other States that have been affected by the hurricanes over the last couple of months. We are being blocked because someone doesn't like a provision that takes money out of a program that was overfunded, that is spending enormous amounts more than what it was intended to spend.

So we have a program that was supposed to spend a couple of billion dollars, now is spending four or five times that amount. And the author of the program doesn't want to put any fiscal constraint on it. As a result of that, we are not getting flood relief. We are not getting hurricane relief.

This is the kind of pettiness in the Senate, partisanship, that gives this institution a bad name. This is the kind of stuff people sit at home and wonder: What are we thinking here. There are people hurting. The money that is being taken out of this program that is the reason for this bill not passing, most of that money isn't for 6, 7, 8, 9 years. The Senator from Iowa can come back next year and get his money back. If there is enough support in this body to get the money back in the program, come back next year and put the money back in the program. You want the money, prove to the Members here that this is an important enough program to get the money put back in next year. If it is that wonderful, if it is that broadly supported, come back with an amendment to an appropriations vehicle and get the money put back in.

But don't stop people who are in desperate need, who have to have furnaces for their homes as the weather turns cold in our area of the country, from having the resources necessary to respond to this disaster.

The money being taken out of this program is over the course of the next 8 years. We are holding up vital funds for people in need today. I can understand how people get upset with this place. Because a lot of the things we do around here don't make a lot of sense. It can be one person. If anybody doesn't think one person can make a difference, one person can make a difference here in the Senate, positively and negatively.

I will let you decide whether a program whose funding was cut over the next 7 or 8 years is as important, no matter what it is, as getting resources to people who are suffering now in America. You decide.

Then we have the issue on a bill, the tax bill that is before us. We have the Senator from Louisiana who is upset that she didn't get a provision in the tax bill. I would like to tell the Senator from Louisiana and every other Senator, I have a long list of things I did not get in this tax bill. I spent two full days sitting over in the House of Representatives Ways and Means room, pleading with the Congressman from California and others for provisions I thought were vitally important to the economy, to average working people, to people in my State, to people in other States, energy provisions.

I understand the Senator from Louisiana didn't get her provision in the bill. By the way, this is a bill having to do with foreign tax credits, foreign sales corporations. Everyone complains about putting extraneous provisions on. This is probably an extraneous provision to the core of this bill. I would make the argument that the provisions I was arguing for, which was the Baucus amendment-he offered a single amendment on this, the 5-year net operating loss carryback-to me that was important. There are businesses in my State that can't hire people because of the way the Tax Code works and unfairly treats them when they have a good year versus bad. It averages it out to keep things going smoothly. It is a vitally important provision, from my perspective, to create jobs and employment opportunities. It was defeated. The House defeated it. We passed it in the Senate. We pass lots of amendments in the Senate, and the House defeated it.

I had an amendment that was vitally important for me in my State and for the neighboring State of Ohio. I worked diligently on that amendment. It wasn't a $2 billion-plus provision; it was for $30 million. I look at the Senator from Mississippi, who may be thinking: $30 million? We worry about $30 million over 10 years-$30 million? I could not get a $30 million provision in this bill. It could have meant thousands of jobs for my State and neighboring States, and I could not get it in the bill.

Yes, I could grandstand before the people of Pennsylvania and grandstand before the people of America and say I am going to fight this bill and stand up for everything, and I am going to get my amendment passed and we are going to send it back to the House, and the chairman of the House Ways and Means Committee is a rotten guy. I could do that stuff, and I could act like a hero and make great political headlines. But do you know what. That is not going to get my provision passed, and I can guarantee that the chairman of the House Ways and Means Committee is not going to pass my provision if I call him names on the floor of the Senate, which has been done over the last 24 hours, and particularly if they don't agree with the substance of the provision. They are not going to pass it when they see political grandstanding at its worst a few weeks before the election.
What are they holding up? They are holding up a provision that-right now, this bill being held up stops tariffs from being levied on businesses in America, which is hurting jobs today. If we pass this today and get it to the President that much quicker, we would stop those tariffs. We hear so much complaining about how we need to be competitive internationally. This is a bill that will end unfair tariffs that are being imposed on American businesses. We are holding it back for this provision. Is it worthy? I will get into the worthiness in a moment. Even assuming it is the most worthy provision in the world, we are holding back something that is a vitally important piece of business that will get our businesses help and help people be competitive in a world with a global economy.

We have political grandstanding going on. Let me assure anybody who thinks they can play this game on any amendment they may like and they are going to hold up the show because they didn't get their provision, which wasn't even offered by any individual Senator, an amendment that was so important-I understand it was so important to one particular Member, but I can tell you not one Senator on either side of the aisle offered this as a singular amendment to be passed.

As the Senator from Oklahoma said, I sat there for two days. If it was that important of an amendment, I can tell you there was a whole energy bill in there that is very important. You want to talk about important for national security and for economic security and stability? How about passing an energy bill when you have $53-a-barrel oil? You bet I wanted to get that done. Am I upset that we did not include that? You bet. Part of the legislative process is that you have to make choices.

This was a bill very narrow in scope. There were a lot of things we passed in the Senate that we didn't pay for, or we did pay for but the "pay fors" probably had more objections than the underlying amendments. When it came over to the House, all these "pay fors" went away. We had a requirement in this body on both sides of the aisle that this was going to be a revenue neutral bill. So there we are. We had to cut out provisions in the Senate bill. The provision of the Senator from Louisiana got cut. My provision was cut. The energy bill got cut. A whole list of very good pieces of legislation got cut. I wish they had not. I wish we could have found a way to pass them. We could not. Here we are.

Are we going to end tariffs and give our businesses the opportunity to compete globally? Are we going to grandstand and talk about how we are going to keep people here all night long? The Senator from Missouri will have to sit here all night long and other Senators have to sit in the chair all night long just to show how tough we are, how we are going to stand up and fight for our men and women in uniform.

Let's see. The Senator's amendment provides a tax credit for businesses who have employees who are guardsmen and reservists overseas. As the Senator from Oklahoma said, that seems to be a rather indirect way of increasing pay for Guard and Reserve. Also, I make the argument it is a very inefficient way. I have the magazine of the Reserve Officers Association of the United States in my hand. This magazine surveyed the Fortune 500 companies. I commend the article to my colleagues.

This was published in the January-February 2003 edition. What this said-by the way, obviously, I don't have an updated copy. I don't know whether they have done another survey. When they did the last survey, we found that, in 2003, only 17 of the Fortune 500 companies did not provide additional compensation for guardsmen and reservists who were deployed. In fact, well over a hundred-154-provide full compensation. In other words, they pay them fully, every penny of their salary-not just what the Senator from Louisiana suggested, $15,000, but fully pay their salaries. The rest pay some or most of their salary and benefits for the individuals and their families.

What are we going to do with this legislation? We are going to enrich the Halliburtons of this world and the other big Fortune 500 companies that are already providing these benefits. We are now going to give them a tax credit. We are going to spend $2 billion-plus to give tax credits to Fortune 500 companies and a lot of other companies that already are providing these benefits. Is that a very efficient, cost-effective way, in a time of big deficits, to pay Guard and Reserve a lot of money? I argue that is about as inefficient a way as possible to do this.

Who are we benefiting here? Certainly the Fortune 500 companies. Are we benefiting the reservists or the Guard person when all but 17 of these companies are giving benefits now in excess of their pay that the Government pays them? So if we send those companies that money, all the company has to do is say: Thank you for the money. We are already paying them, but we could use the money. We can increase our profits a little bit. Thank you very much. There is no obligation in this legislation that they have to take that money and pay even more benefits. In fact, 154 of the companies already pay full benefits. They could not pay any more benefits.

I understand the Senator from Louisiana wants her provision included. We all like to get our provisions included. We also would like to go home. We would all like to get our business done. We would all like to go out and get in touch with our constituents and find out what they really think instead of what we think here is best for them. We do a lot of that around here-what we think is best for everybody. I argue that this provision, which is going to enrich a lot of Fortune 500 companies, is the most inefficient way possible to solve this problem. If you want to pay guardsmen and reservists more, talk to the Senator from Virginia, talk to the Senator from Alaska, talk to the new chairman of the Appropriations Committee, the Senator from Mississippi, and you ask them whether we can structure something so that we are now going to compensate Guard and Reserve more than we are going to compensate Active Duty people. That is a legitimate issue. I believe we can have that debate.

But to make all this fuss about how we are going to stand up for all our guardsmen and reservists and fight for them until the end, let me assure the Senator from Louisiana, at 7:40 tomorrow we are going to pass this bill. If the Senator from Louisiana wants to make everybody sit here until 7:40 tomorrow night, we can wait until then, and at 7:40 this bill will pass and her provision is not going to be on it, and her provision is not going to become a Senate bill passed by the Senate between now and then. We can wait until that time. We can wait and let the tariffs continue to be levied another day on our workers here in America.

We can wait and have provisions having to do with energy such as the Alaska pipeline another day; we can wait so we can have the political opportunity to talk about how important Guard and Reserve members of our military are; but this is an inefficient and costly way of solving the problem.

I argue that is as much a reason why it did not pass as anything else. The idea that someone believes their provision is so much superior to everybody else's, I think that probably every Member of the Senate had a provision they wanted or they would like to have seen in that bill that they did not get.

The thing about legislating is we do the best we can. We work hard and live to fight another day, and we do so in a way that builds relationships, tries to get things done in a collegial way. I make the argument that keeping Members here on Saturdays, Sundays, Mondays, and Tuesdays during recesses when people had scheduled events, when their campaigns are, obviously, at this point very much underway, when nothing substantively that they are proposing is going to happen, is not the most effective way to win friends and influence people.

Now, if I were for the Senator's provision-I do not know whether I will ultimately end up voting for it, but I ask her, if I were a supporter, to please give this proposal a chance instead of making it a proposal that has fostered some ill will around this place. We have an opportunity to do something right, pass three pieces of legislation that should be passed. We have disaster assistance that should be out today, as well as homeland security. I wish I had a nickel for everybody who talked about how much more money we need for homeland security. We listened to the debate the other night where it was said we were not spending enough on homeland security.

Well, we have a Homeland Security bill. The subcommittee chairman is in the Chamber. I do not know what the increase is for homeland security in this bill from last year, but I suspect it is substantial. That money is not being spent. We are in the next fiscal year right now. We could be spending that money right now. We could be securing our homeland right now.

Mr. COCHRAN. Mr. President, will the Senator yield?

Mr. SANTORUM. I would be happy to yield.
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Mr. SANTORUM. I ask the Senator from Mississippi, is there any provision in this bill that is being objected to by anybody, that the Senate is aware of, on either side of the aisle?

Mr. COCHRAN. There is no objection that I have heard from any Senator. There is a disaster provision that was included in this bill. It has now been taken off the Homeland Security appropriations bill. It has been added to the Military Construction appropriations bill. This bill is clean of any provision that any Senator had opposed, to my knowledge.

Mr. SANTORUM. I then will reiterate, if there is no objection to this bill, I ask unanimous consent that-I yield to the Senator from Alaska, since he is the chairman of the committee, and ask if the Senator would like to make a unanimous consent request because I think this is important. Since we have now established beyond a shadow of a doubt that there is no objection by any Senator to this bill on either side of the aisle, I ask the Senator if maybe this would be an opportunity that we could have to pass this bill and get these needed funds for homeland security purposes. At a time of war when our threat has been elevated, where they talk about all the danger that is in front of us as we lead up to this election, not to be able to pass this Homeland Security bill at this time would be unconscionable, so I would be happy to yield to the Senator from Alaska to ask for the opportunity to pass this bill since nobody is objecting to any of the substantive provisions.

The PRESIDING OFFICER. The Senator from Alaska.

Mr. STEVENS. Mr. President, the Senator from Pennsylvania is correct. We have heard no objection. As a matter of fact, we have a wrap-up procedure, is what we call it-and the Senator is familiar with that-at the end of each legislative day. This Homeland Security bill was in that. We know that absolutely no one objected to the Homeland Security bill in the first instance and later the Senator from Iowa, Mr. Harkin, came back and objected. So this bill is held up apparently because the Senator from Iowa wanted to have some other thing in the way of getting on Military Construction.
I am happy to renew the request.
Mr. SANTORUM. If the Senator would yield just to clarify, the Senator from Iowa came back and objected not to any particular provision in this bill; there was no objection to the underlying Homeland Security bill?
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Mr. SANTORUM. The Senator from Iowa just objected again to this bill, which nobody objects to, being passed. Again, it is 3:30 eastern time on a Sunday and I suspect the viewing audience of this debate is not particularly high, but I would also suspect that those who are viewing are sitting there with furrowed brow asking: What was that all about? No one objects to this bill, yet there is an objection.
Our country is at war. Our country is at war. There are threats to the homeland. We have the Democratic nominee for President, a Member of this body, who I suspect might have some say about what Members on his side of the aisle will do in a few weeks before the election, who complains constantly that we are not spending enough money on homeland security, that we have not defended the homeland as vehemently as we should have. Where is the Senator from Massachusetts today to put those words into action, to get this bill passed so we can get this money spent now?
It is all a bunch of smoke and mirrors: Oh, yes, we are for all this stuff but a provision having to do with land conservation that is spending four and a half times more money than was originally intended to be spent over a 10-year period of time, the money in the outyears of that program have been reduced to pay for immediate drought assistance in almost the very same area of the country, and it is in a separate bill than the Homeland Security bill and that is why homeland security is not going to pass right now. That is why our homeland will go less defended today than it could be. The furrowed brows are justifiable in this case. This is wrong.
We may be lucky. We may be lucky. The 5 days or 4 days I understand we are talking about, maybe Thursday before we can potentially get the bill passed, the 5 days-we could have passed it yesterday by consent, so Saturday, Sunday, Monday, Tuesday, Wednesday-6 days. The 6-day delay may not cost anybody's life in America. It may not cost a life. We might not have resources that are deployed because 6 days sooner we would have signed this bill and those resources would have been available to maybe protect somebody in America. We will never know that-or maybe we will. But the fact is, to hold up a piece of legislation that is a vital national security interest, for a very small piece of legislation where money was to be taken from it years down the road, I think, reflects the worst of what people see in Washington, DC.
I am hopeful the persistence of the chairman of the Appropriations Committee and the persistence of the chairman of the Homeland Security Subcommittee over the next 24 hours that we will be here, or 27 hours that we will be here, will eventually pay off. I know there are Members on the other side of the aisle who are working diligently to try to convince the Members on that side to move America's business forward. Let me assure everybody-I think we all know this-that the legislation, the homeland security legislation, the drought and disaster relief, the hurricane relief money, and the FSC/ETI bill, the JOBS bill having to do with foreign sales-all three of those are going to pass just as they are. There will be no amendments. They are not allowed under the rules. There will be no separate deals that will allow other provisions to pass to make everybody happy.
They will all pass. They will all pass as if, in fact, we just stood up here and called for the vote on them right now. There will be no difference.
The question is how long are some individuals going to make the Senate wait. But candidly, I complained about not being able to be with my family today. It is Sunday. Usually I take Sundays off and try to be home with my six children. I will tell them, they might be watching, I will be home soon, I hope.
But that is a minor inconvenience. That is meaningless. Our job is to be here to do the job we have to do to get what we need done for the American people. The reason I am here today and the Senator from Mississippi and the Senator from Missouri and the Senator from Alaska and the Senator from Kentucky and the Senator from Hawaii-we are here because we want to get the people's business done. We want to cut those tariffs. We want to eliminate them. We have a chance to do that today. We want to get that money out for disaster assistance. We have a chance to do that today. We want to get that money to the law enforcement agencies and the transportation agencies to protect people here at home. We can do that today.
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But, because of two individuals, we are not. They may stand here and give speeches about how heroic their effort is, and how important their job is to get these provisions they have worked so hard on, but we could all be doing that.
Mr. President, I ask unanimous consent to have printed in the RECORD a list of all of the amendments considered in the Finance and Ways and Means Committee conference report on October 5 and 6.
There is a whole page of them. There are 23 amendments on the first day and another 10 amendments on the next day. We had 33 amendments also considered. I would argue the amendment of the Senator from Louisiana was not offered, except that at the end of the markup all the amendments that no one wanted to offer that were in the Senate bill, that were not offered individually, we threw them all together in one big package and offered them, and her amendment was in the big package that no one thought was important enough to offer individually.
I will not argue her provision is not important. It is, obviously, certainly important to her. But not one member of the Senate Finance Committee, Republican or Democrat, House or Senate, offered it. And we are being held up on the Senate floor. I don't know why. It is not going to become law. At some point you have to say, getting those tariffs off the backs of American business is more important than even the most important provision in your heart. Trust me, I had some of those amendments. It is time for responsible legislating. It is about time we get serious. Let's get our job done. Let's get our job done for the American people. It is decided. Nothing is going to change. It is just a matter of when we are going to do it.
I hope through the good work of the Democratic and Republican leadership-I know Members on both sides are working diligently to try to work through this-that we stop the tariffs that are making us globally uncompetitive; that we start funding homeland security at the levels the President and this body said they wanted; and that we start getting the resources to people all throughout the eastern part of the United States, including the Commonwealth of Pennsylvania, get the resources into the hands of the small business people and homeowners who have been hurt by the floods and storms of the last couple of months. That is what this is all about, those three things, three vitally important provisions, three bills that could pass in 5 minutes. In 5 minutes we could call those bills up and pass them.
I feel like "Name that Tune." I bet we could do it in 4 minutes, maybe even in 3 minutes we could pass all these bills. And, by the way, they are going to pass. They may not pass tomorrow-well, one of them will pass tomorrow. Maybe Wednesday. Maybe Thursday. They are going to pass. So what are we accomplishing? We are hurting the American public. We are costing jobs. We are adding insult to injury to people who have been devastated by natural disaster, and we are making our country more vulnerable by not having increased homeland security protection at home. That is what we are accomplishing.
Congratulations, Senate. Good job. Keep those tariffs high. Make us uncompetitive. Don't give that money to people who suffered through natural disasters. Let's keep it here in Washington because we have some political points to make.
I have some political points I need to make. You know, you can wait. You can wait, Transportation Security Agency, for that additional funding. You can wait, Coast Guard, for that additional funding. You can wait, because politics here in the Senate comes first. Opportunities to show the folks back home I am fighting for you, that comes first. Amazing. Amazing.
The most amazing thing is it is a futile fight. All three bills will pass without changes. Do you know why? Do you know why I am certain, why the Senator from Mississippi is certain? Because that is the rules of the Senate. They cannot change. They are conference reports. They cannot be amended. So what is this all about? It is about putting personal political interests above the interests of those hurt by natural disasters, those who are being hurt by high tariffs, and those who would like to feel more secure in our country with increased homeland security spending. That is what it is about. Let's tell the story. Let's tell the story about what is going on here on a Sunday afternoon in the Senate. Everyone is safely at home, we hope, watching their football games or the league championship series. What is going on here in the Senate is political demagoguery at its highest level. Let's call it for what it is. We need to stop this. We need to get our job done. We need to go home and talk to our constituents and work on problems.
I ask unanimous consent, again, on the issue of homeland security, that we call up the Homeland Security conference report that has not been objected to on any substantive ground, that we call up the Homeland Security Subcommittee appropriations conference report and pass that bill by unanimous consent.

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Mr. SANTORUM. Mr. President, I ask unanimous consent that the disaster assistance conference report and the Military Construction conference report be called up, and I ask unanimous consent they be passed.