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Concurrent Budget Resolution on the Budget, Fiscal Year 2014

Floor Speech

Location: Washington, DC


Mr. DURBIN. Mr. President, as we consider the budget resolution, laying out a blueprint for how we invest in our Nation's priorities, I urge my colleagues to support my amendment creating a deficit-neutral reserve fund to allow for the growth of the National Institutes of Health, NIH.

We all have benefited from medical innovations and cures supported by the NIH. If you have ever faced the diagnosis of an illness in your family and turned to the doctor to ask: ``Is there a cure? Is there a treatment?'' then you understand the importance of NIH research for your family. Great medical care is only as good as the science behind it. Drugs and devices work only as well as our understanding of the medical condition we are treating. NIH support has established the U.S. as a global leader in medical innovations that save lives, and we are on the verge of so many life-changing discoveries.

We all remember the 1980s as the AIDS epidemic gripped our country and the world with a disease that was at that time a death sentence. But now thanks to drugs created with NIH support, people with HIV can live a long, productive life into old age. Ironically, the same week that sequestration took effect, a groundbreaking medical discovery supported by NIH was made in AIDS research. A 2-year old baby in Mississippi born with HIV may be the first child to be functionally cured of the disease after receiving a cocktail of drugs. This study was supported by the NIH, and NIH played a key role in the development of the drugs used to treat the toddler.

Our country is rich with promising research just like this and rich with bright minds, curious scientists, and innovative labs engaged in work that will lead to a cure for AIDS and treatments for diseases like cancer and Alzheimer's. But cuts to NIH could curb the promise of these medical discoveries.

The medical advancements for which we owe our thanks to NIH are many. Thanks to NIH-supported research, the likelihood that a child with leukemia will survive for 5 years is now 90 percent. And 152 new FDA-approved drugs and vaccines have been discovered with NIH support over the last 40 years. Just 2 weeks ago, I talked with a researcher at the University of Illinois Chicago who credited NIH-supported research that created a blockbuster new drug to treat HIV.

NIH-led research developed beta blockers, a commonly used drug to treat high blood pressure. And thanks to these drugs, fewer people are hospitalized for cardiovascular disease, saving lives and also saving costs to Medicare and the Federal Government of $6,000 per patient. Investments from NIH in the Human Genome Project opened the door to countless medical discoveries and cures and generated $796 billion in economic output--a return on investment of $141 for every $1. A promising NIH-supported project at the University of Pittsburg School of Medicine is working to allow people with paralysis to move a mechanical arm with their minds. Imagine how this innovation could improve the lives of people paralyzed from a stroke and servicemembers with spinal injuries.

I would like to share the experience of Stevie Conti, a 25-year-old woman from Deerfield, IL, who has cystic fibrosis, a rare disease that impacts about 30,000 people in the U.S. Stevie loves cooking and hanging out with friends. Her twin sister says she is the last to complain about anything, including her health. Thanks to investments from the NIH, tremendous scientific breakthroughs in genetic mapping and drugs are improving the lives of people with cystic fibrosis. A little over a year ago, FDA approved a groundbreaking new drug, called Kalydeco, which is the first drug to treat the genetic cause of cystic fibrosis in some people.

Since Stevie started taking Kalydeco her health has improved by leaps and bounds, and she is able to do simple things that many of us take for granted. She has gained 10 pounds and can run a mile without coughing or feeling short of breath. Stevie has landed her dream job and is able to work 40 hours a week without feeling tired and still has enough energy to hang out with friends after work. Stevie says this drug has changed her life. NIH-supported research and scientists are helping people, like Stevie, live healthier, more productive lives. Right now, when so much good research is showing us the way forward, we should be doubling down on biomedical research and infrastructure.

Due to several years of flat funding and cuts, the current NIH budget is insufficient to fund all of the critical research that needs to be done. Due to cuts to NIH funding and the failure to keep up with rising research costs, the number of research grants funded by NIH has declined every year since 2004. In 2012, NIH funded 3,100 fewer grants than in 2004. Cutting back on biomedical research is a shortsighted act that undermines everything we are trying to do for this country. Medical research saves lives, keeps America's place as a leader in science and medicine, and generates economic growth. Every State and the District of Columbia receive NIH funding. These awards go to universities, businesses, and research centers--engines of growth for local economies.

Not only is NIH dealing with years of insufficient funding, on March 1 sequestration went into effect imposing mindless, across-the-board cuts for critical, federally supported programs like defense, education, aviation safety, and scientific research. This is a manufactured crisis that never should have happened. We need to reduce our deficit in a thoughtful and sensitive way, but sequestration is a hatchet approach that cuts from vital programs that protect our Nation and economic growth. A $1.6 billion cut to the NIH, due to sequestration, will cause 20,000 jobs to be lost. A cut of this magnitude will have a ripple effect that will hurt every State in our Union.

Last year, Illinois received $746 million in NIH funding. Sequestration would cause Illinois to lose $38 million. That translates to 700 fewer jobs, less innovation, and a slowdown of economic growth in my State. Our country is just starting to recover from a recession. We cannot afford a mindless cut that will lay off hard-working people and stall economic growth.

Every $1 in NIH funding stimulates $2.21 in business activity that develops around research, such as biotech companies that provide supplies, food services and restaurants, building construction, and hiring support staff. As research projects slow and then stop, the companies that provide equipment and supplies and the construction projects to expand research facilities also slow and then stop. Some U.S.-based companies that provide lab supplies to researchers expect that a cut to NIH will cause a drop in sales and slow down production lines forcing companies to close sites and lay off workers.

Dr. Francis Collins, the Director of the NIH, says there is no question that sequestration will slow the development of an influenza vaccine and our progress with cancer research.

Eli Zerhouni, the head of NIH under President George W. Bush, says:

We are going to maim our innovation capabilities if you do these abrupt deep cuts at NIH. It will impact science for generations to come.

Insufficient funding and cuts to NIH will force the agency to not award some grants. And it may need to reduce awards that have already been announced. Research and clinical trials that have already started are less likely to be given funding to continue, so promising projects will be terminated, suspended or forced to lay off workers.

I would like to share the story of Dr. Teresa Woodruff, a researcher and professor at Northwestern University's Feinberg School of Medicine. Dr. Woodruff is leading one of the first major studies on the impact of superfund environmental toxins on reproductive health. Her work could help us understand the health risks of certain chemicals and how pollutants enter the human body. The Monday after sequestration took effect, Dr. Woodruff was delighted to learn that the NIH had awarded funding for her research, but disappointed to learn that--due to sequestration--the grant was cut by more than half.

Dr. Woodruff is thankful for the NIH funding, but this cut means she will have to drop key parts of her research, like studying the impact of toxins on men and children and how pollutants end up in the food we eat. Because of the drastic cut in funding, Dr. Woodruff will not hire new people and will have fewer training slots to teach the next generation of scientists. Dr. Woodruff's experience is being played out across the country as promising researchers are forced to stall clinical trials and lay off support staff.

The percent of NIH grants being awarded since the 1960s has dropped significantly. Currently, less than one in every five grants to the NIH is awarded funding. The primary reason for this decline is insufficient funding. Less funding will result in fewer grants being awarded, and the group of researchers most impacted by this cut is young researchers. Once we add the $1.6 billion cut due to sequestration, we risk losing a new generation of scientists in our Nation.

Less funding means fewer academic grants to educate young scientists. And more competition for grants makes it difficult for young scientists to win funding and dissuades new scientists from pursuing careers in research. When and if NIH funding eventually increases, projects will struggle to find and train talented scientists who will make tomorrow's discoveries.

For over a century, NIH-supported scientists have led the way for important breakthroughs to improve health and save lives through discoveries--discoveries such as development of the MRI, extending the life expectancy of people with cystic fibrosis, revolutionizing our thinking about cancer, and creating vaccines.

Two weeks ago, I received a letter from a man named Andrew Young from Vernon Hills, IL. His 16-year-old sister Emily has a rare disease called Friedreich's Ataxia, a rare disease that makes it hard to perform basic motor functions like walk, write, and speak. Most young people with FA need to use a cane or wheelchair by their teens. Emily's world was turned upside down in 2008 when she was diagnosed with FA, but she refuses to let it define her. She wants to go to college and practice medicine and hopes for a cure one day.

Now is not the time to disinvest in NIH and close the door to finding cures for people like Emily. Disinvestment in NIH would be a shortsighted act that risks forfeiting the U.S.'s position as a leader in biomedical research and reaping the economic and biomedical rewards of scientific research. These cuts don't make sense for--patients, local economies, or our Nation.

I urge my colleagues to support this amendment and to ensure our country creates and benefits from the life-changing medical discoveries supported by the National Institutes of Health.

I ask unanimous consent to have printed in the Record a list of organizations that support my amendment.


Mr. DURBIN. Mr. President, it is my understanding under the unanimous consent request there was 40 minutes of debate allocated between those of us in support of the Marketplace Fairness Act and those who are offering amendments, Senator Ayotte and Senator Baucus; is my understanding correct?

The PRESIDING OFFICER. The Senator is correct.

Mr. DURBIN. Does the Senator mind if I say a word in opening?

The Marketplace Fairness Act is known to every Member of the Senate because I have spoken to everyone on this side of the aisle, and I think Senator Enzi and Senator Alexander have spoken to everyone on the other side of the aisle. First, give credit to the Senator from Wyoming, Mr. Enzi. He began this effort 14 years ago. He is a small businessman by profession and when he came to the Senate he saw a problem that needed to be solved and he has done yeoman's work to reach this point in the debate.

I salute him for that effort. I thank him for allowing me to join and bring it to the floor this day. Special thanks to Senator Alexander from Tennessee, who has been an able partner in allowing us to bring this matter before the Senate.

This is an issue every American can understand. We now live in the Internet age. Internet retailers are selling things over the Internet that we are buying every single day. Estimates are that $150 billion in sales are made each year over the Internet. That is part of America. It is part of our economy. But it has created an unfairness which we need to address with this legislation.

Back home in Massachusetts, in Illinois, in Tennessee, in Florida, there people with shops and businesses who get up every morning and open those shops, watch their employees file in and do business locally. When they make their sales of goods and services, they collect the sales taxes which each State requires and they collect other taxes as well. Their taxes sustain businesses, sustain schools and highways and police protection.

Unfortunately, a Supreme Court decision of almost 20 years ago, the Quill decision, basically said if we are going to require the Internet sales to collect sales tax, Congress has to do it. That is why we are tonight on this Marketplace Fairness Act.

What we are proposing is not a new tax. It is the collection of an existing tax, a sales tax that is basically owed in all but four States across the United States.

We believe this is a fair thing to do so those local businesses have a fighting chance; otherwise, they are competing against retailers who do not collect sales taxes and have that price advantage over them.

That is not fair to the businesses on Main Street across America. It isn't fair to our economy. What we are looking for is basic fairness.

At this point, I yield the floor to the Senator from Tennessee.


Mr. DURBIN. In the interest of moving this forward, we have scheduled a vote on the Ayotte amendment next, after the vote on the Enzi amendment. I urge everyone who votes for the Enzi-Durbin-Alexander amendment to oppose the Ayotte amendment because she includes a provision in that amendment which absolutely destroys the whole effort here. She requires physical nexus.

As Senator Heitkamp has said, that is what this debate is all about--whether one has to be physically present in order to have an obligation to pay sales tax.

So I urge all of my colleagues who support the Marketplace Fairness Act to oppose the Ayotte amendment. I hope she will explain why she wants--I think we understand from the arguments why she takes that position.

May I say one or two things about what has been said? To my friend from Oregon, Senator Wyden, who talked about the impossibility of collecting sales tax from foreign entities, that is just not true. The same collection mechanisms presently available to

States to obtain and enforce judgments against foreign entities would be available to States with respect to foreign entities failing to comply with the MFA. States currently have, and would continue to have, access to customs information on imported goods. Accordingly, States can and do use that information as a means of encouraging remote sellers to collect sales tax. States currently have, and would continue to have, the ability to impose liens on any property owned by remote sellers, even property in transit. So to argue we can't collect taxes from international entities is to ignore existing law.

Let me say a word about the small businesses in Montana. After the $1 million exemption, I would ask my Senator friend from Montana if he knows how many Internet retail sellers would be affected by the Marketplace Fairness Act in Montana.

Mr. TESTER. Too many.

Mr. DURBIN. There are 3. There are 3 out of 975 Internet retailers with over $1 million in sales. There are 3 in the State of Montana. This is an undue burden on the small businesses of Montana?

What I would say to the Senator from Florida and the Senators from Montana, what we are saying is very basic. You aren't forced to sell in Illinois. There is no reason you have to sell in Illinois. You choose to do it. If you choose to do it, all we say is follow our law. Our law says if you make a sale in our State, there is a sales tax to be paid. If you don't want to get involved in that, you don't have to sell in our State. Keep your marketplace limited to places where you want to do business. That is your right as a businessman. But if you want to sell in our States, you have a legal obligation to pay in our States.

If you want to open a business on Michigan Avenue in Chicago, you know you would have to pay plenty of taxes. Why is it if you want to sell to the same people living on Michigan Avenue, you have no obligation to pay a sales tax? That is what this is about.

I reserve the remainder of my time.


Mr. DURBIN. I thank the Senator from Tennessee for making that point. As to this notion that there is something fundamentally unfair that we would ask an Internet retailer that wants to sell in Illinois that they collect the same sales tax for that sale as the businesses in Illinois, for goodness' sake, you are asking for a safe haven, an advantage over a lot of good small businesses in my home State. As Senator Alexander said, if you don't want to abide by the laws of Illinois, for goodness' sake, make your sales elsewhere.

The Marketplace Fairness Act levels the playing field for all retailers, Internet and direct. It provides software free of charge to help retailers calculate sales and use taxes.

I heard my friend, the Senator from Montana, talk about how complex this was, how difficult this was.

I just made a recent purchase on Amazon which endorses the Marketplace Fairness Act, and I paid sales tax. They didn't ask for any additional time to calculate it. It assumes I put in my ZIP Code, and they knew exactly what to collect from me. That is how easy and simple it is these days.

This bill will also provide liability protection to ensure that if the software calculates the wrong tax, Internet retailers are held harmless.

Finally, the bill protects small businesses, as we mentioned earlier, by exempting small sellers with less than $1 million in annual remote sales nationwide.

I know as well that there are other elements of this that ought to be considered, but we ought to consider this: There was a time when we stayed away from this issue. I remember the Senator from Oregon, Mr. Wyden, was in on this conversation about the Internet being brandnew, the baby in the crib, let him get started, let's make sure they are solid and moving forward. We can't ask them to do certain things.

That day is over: $150 billion in sales. It is in our lives, everybody's lives. We use the Internet every day. What is wrong with asking them to pay sales tax for the sales into the States where they are doing business? Otherwise, look at the disadvantage we create for businesses.

The State of Oregon, represented in this debate, the State of Montana, the State of New Hampshire, and one other have decided they don't want a State sales tax. There is nothing in this bill which will require the residents of that State to pay one penny in sales tax on anything they purchase, period. There is no requirement to change that.

I know, as Dale Bumpers used to say, they hate sales tax in your States like the devil hates holy water, but we are not imposing a sales tax on you, only if your New Hampshire business wants to sell in another State. Then, of course, I think they ought to play by the rules of that State. That is basically what we are asking.

So at this point I ask how much time is remaining.


Mr. DURBIN. Mr. President, do I have the last minute remaining?

Let me just say, my friend, Senator Heitkamp from North Dakota, knows this subject so well. The case you want to read is Buckley v. State of California as to whether State laws are enforceable against foreign companies. And they are. That decision has already been reached. This argument does not hold water.

What does hold water is this: There is no reason why any State retailer should have an unfair advantage doing business in my State or any other State. If they want to compete with my businesses that pay their taxes, as they are supposed to do, let them do business under the laws of the State of Illinois. If they do not want to play by these rules, then they do not have to come to Illinois. This is a question of fairness.

The last point I will make is this: This is voluntary--voluntary--under the Marketplace Fairness Act. States have to voluntarily decide that they want to be under this act. If they do not care to be, they do not have to be. So there is no heavy hand of the Federal Government here. The States can make this decision. It is up to them. I hope that all of those who support the Marketplace Fairness Act will support the Enzi-Durbin amendment.


Mr. DURBIN. Mr. President, I would like to suggest that the amendment being offered by the Senator from New Hampshire is unnecessary. It relates to fiscal year 2014. There will be no request for this missile system in fiscal year 2014.

I suggest that if she wants to pass this, she might, but perhaps she can do it by voice vote because her amendment won't apply to any suggested funding for this missile system in this next fiscal year.


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