congressional directory with contact information for each member of the house and senate. .. >> the american jewish committee hosted a debate on the upcoming presidential election friday between representative barney frank and the "the weekly standard" editor william kristol. israel was the central focus but the two discussed a wide range of other issues including abuse of president obama and the

presumptive residential nominee mitt romney. this is just under an hour and 20 minutes. >> ladies and gentlemen please welcome a jc executive councilmembers, linda mirels and john shapiro. [applause] >> good morning. john and i are delighted to welcome you to today's great debate of 2012ajc global forum. this has become an anchor a band event for the global forum, and the great debate can really be -- is always a place where you can hear the important issues. two years ago, many of us were here for the memorable debate on iraq and as we heard yesterday,

this continues to be a very pressing issue for the community. and last year, the event covered israeli relations and another issue which can be heard in the corridors of all major jewish organizations. most appropriately, this year the debate will be on the american presidential election, an issue that will impact us all and has great implications for the state of israel and of course ajc and be counted on to present all sides of the story in depth. >> thank you very much linda. welcome to all of you. it's a delight to be here this morning. i think it is not going to be too far of a stretch to suggest that our debaters, william kristol and barney frank will have some disagreements this morning about the election. [laughter] and in fact i think on many

political issues we might find they have disagreements. but what they don't disagree upon is the importance of being here with us today at the ajc because what i believe, what they do believe is in the value of the ajc, the respect of the ajc, the intellectualism and the nonpartisan approach to the challenges that we face in this world and the great success of our quiet diplomacy. so, for that i thank them for being here today. i think it will be fun and i would like to encourage you now to sit back, watch a brief introductory video and then let the good times roll. so, thank you all. [applause] >> i have yet to find --

>> in the blue corner, veteran democratic congressman barney frank, known for his quick tongue and illustrious career that has been the big issues from civil rights to financial regulation to foreign-policy. >> in 2005 in and 2006 people in the hillary clinton bill clinton machines that barack obama come are you kidding? what is he ever done? he can't run against hillary clinton. >> in the red corner bill crystal the editor of "the weekly standard" one of america's most celebrated commentators and a thorn in the side of the obama administration on everything from health care to u.s.-israel relations. >> the coming presidential election in november is one in which ajc's priorities will set the stage for what is the best approach to iran given the regime's continuing drive to obtain nuclear weapons capabilities? is the grand prize and israeli palestinian settlement, something that has eluded successive presidents for more

than half a century and a closer? and against the continued debate again -- homeland security. how close his the united states towards reducing its dependence on energy supplies from hostile states? over the next hour, these and other issues will be in the spotlight, so don't forget to submit your question as we welcome you to ajc's great debate on election 2012. [applause] >> thank you. thank you to linda and john and welcome to this year's ajc great debate, and i especially want to welcome our viewers were watching on c-span across the

country and around the world. our subject is the 2012 american election. its implications for domestic and foreign policy, its specific implications for developments in the middle east and for the security of our democratic ally, israel come its meaning of the yardstick of political attitudes on loyalties in the american jewish community. ajc it must be clearly stated at the outset district laid nonpartisan. we do not, and we cannot, support any particular candidate in any election. but, nonpartisan does not mean nonpolitical. the policies that we have vacated the united states and around the world, policies to promote peace and security and human rights, are policies that succeed or fail in the political arena. our engagement in the political process could not be more intense. it is because of our active

political interest at ajc regularly convenes election-year debates and discussions on a slightly smaller scale than this in cities across the country. is the recently published candidates responses to ajc policy questionnaires, conduct issue forums at the two parties political conventions and regularly and scientifically survey american jewish political opinion. in fact the latest ajc opinion survey was released at the beginning of this week and we will be discussing it shortly. before we begin our debate with congressman barney frank and weekly standard editor bill kristol, a word about our format. we will begin with opening statements. each debater will have five minutes for his statement and then two minutes to respond to his counterpart. we will then lead to the question and answer portion of the debate in which each speech or -- each speech or will have five minutes to respond. finally sibula the opportunity to offer two-minute concluding remarks. these time limits will be strict

reinforce. now i will ask bill to kickoff this year's ajc great debate. bill, thank you. >> thanks jason. it's good to be here. i have a long association -- my family has an associate with the ajc and hold in a high high regard. my father was a commentary back in 1947 to 1952 when commentary was part of the ajc and before the ajc move to the fancy building at 156. it was thought to be a fancy building in the mid-fifties when they moved in. [laughter] i think they referred to downtown originally as a dumpy or place and then my uncle worked at the ajc for many years. i remember him sitting in that office and i -- i think it was the only person in the first bush white house it had several editions of the ajc yearbook and might case. in the old executive office building. it's good to be here to debate

the case i guess that is what i'm supposed to do for mitt romney and the republicans against president obama. every four years i dutifully accept invitations to debate prominent, intelligence liberal liberal democrats on behalf of the republican candidate before jewish audiences so it is a pathetic scene. [laughter] i have her record, unmatched record of failures for this effort from 1984 on. you are all adults and you probably made it up it up your mind, 98% of you. there are a range of voters in this audience i suspect. this will not be as bad i predict his 1996. and 96 i debated leonard fein to distinguish jewish generalists than the editor of moments magazine at the jewish theological seminary in new york and i remember that because the moderator was a woman before he walked out on the stage, and there were 500 people there, he

said this is probably a liberal crowd on the upper westside, clinton against dole, prime minister rabin had been said -- assassinated and dole had no particular affiliation. he wasn't close to the jewish community and i remember saying before he walked out on stage i imagine this audience is probably a little bit pro-clinton and the moderator cheerfully said to me, i don't know, there are about 500 people and 480 of them are pro-clinton. about 20 are undecided. [laughter] i think i lost most of the undecided in the course of the evening. my principles case for conservatism and in 2000, true story, debated mike reid from the northern jewish community center where we lived in northern virginia months before the election early in 2000. one of the sunday brunch is at the jcc to debate the election i

did david mark mehlman has a prominent democratic pollster, political operative from this area. we didn't know who the nominees were going to be that evening or if we did we certainly didn't know the whole ticket and i remember thinking this will be tough. maybe i have a chance because george w. bush was very pro-israel and that wasn't clear that clinton at least wouldn't be running for re-election so we would have a chance. then i remember the day that al gore announced joe lieberman was joining the ticket. [laughter] but joe lieberman personally has spent a lot of time and every single person in the audience in the jewish community center. that was really a wonderful moment, defending, making the case for bush-cheney against gore, gens gore-lieberman. there were relatives of joe lieberman there, people who have been at his daughter's wedding. [laughter] it was really a nightmare. i told the story to lieberman a year later. i thought it was amusing that i

made the case against him and joe thought it was funny. that had less of an offensive humor about this. he was a little shocked that i hadn't voted for her husband in 2000. i may look the differences between a party are pretty evident and i don't know if they are as specifically jewish about the differences in terms of economic and foreign-policy and social policy. we have a center-right republican party and the centerleft democratic party with many clear divisions. i very much hope honestly this election is a policy heavy, issue heavy election and it won't be because the campaign operatives takeover. the country deserves a serious debate now about entitlement reform, tax policy and about the best way to stop iran from getting nuclear weapons and about the whole spectrum of issues. actually i am somewhat optimistic that once the republicans are through the primaries and president obama has a primary and that is

another thing i'm unhappy about. i'm sorry barney is here instead of having what he should've been an done and run against president obama in the primaries took give liberalism i voice. here obama sold out the liberals on so many things and they let him go for renomination. more and fortunate because incumbent presidents don't have primary challenges as a better chance of winning. i spent about a week trying to get people like arnie frank and russ feingold to challenge obama to the primaries and that worked as well as my attempts to get jews to vote republican in the past. we will have a serious debate, a serious argument about foreign-policy and national security which i think it's very important. it should not be put aside simply on behalf of economic issues but also about entitlement reforms and about obamacare and everything else. i do think you're a ajc poll shows romney doing considerably better among jewish voters than mccain. obama beat mccain in the era of open chain -- hope and change

among jewish voters. you allocate the undecideds proportionately in the ajc poll it looks something like 68-32, 69-31 split among jews this time so if romney can do much better among the whole country as he looks like he is going to do among jewish voters he will be president obama which i think will be a good thing for the country. >> bill, thank you. barney, you will have extra time. >> thank you. let me acknowledge the roof will calm for -- complement the bill paid me by explaining i wasn't dumb enough to challenge the president. [laughter] if it is always my refusal to run against the president in a way that would endanger the chances of the public policies i want being accepted. i guess that is one more case where he tried not to live up to the stereotypes that people use regarding me.

and with gara to -- there are some important issues here. we have got to reduce the deficit and the question is what makes the policies do you do? there are differences between the parties. i have one very clear difference with the way will shape the 27th air is a centerleft democratic party and a center-right republican party. it used to be. there has been a center-right republican party. unfortunately, the republican party has moved much further to the right and as norm ornstein just documented in political scientists documented there has been some movement apart but the republicans have moved further right than the democrats of move further left. bill is has just testified to that by his dig at those of us who are sensible levels not attacking our president because he has not been able to get done everything we want, but the fact is the republican party has moved entirely to the right so we now have is a major debate

foreign policy on the republican side whether or not the fact that you are disables you from being a foreign-policy adviser. that is taking us beyond the realm of rationality and if you look at the republican party in the house i think you said you won't have a center-right republican party. i hope you will. it be proud to work with a lot of republicans but i find it much harder to do in the current congress and i hope that there will be a resurgence of the more responsible mainstream republicans. as to the election, obviously on most of the issues, i say obvious as a statistical fact, given where american jews have been in terms of the political spectrum, we started out with the notion they will vote democratic in the majority. again that has been confirmed with the 68-32 democratic margin is considered an erosion, a wood he. but the issue that i think has to be framed is this. given the fact that most jewish

americans, given their views on economics, the environment, civil liberties and a woman's right to choose in the whole range of other issues would be likely to vote, craddick. should they instead vote republican because president obama is weaker on israel, and i think the answer is no. one of the questions i had was should this be a referendum on obama's policy toward american jews? no for two reasons. the most important reason is there are not significant differences and in fact this notion that somehow president obama has been anti-israel, i served with the president, who did take some steps that were blocking israel in congress. that was george h. w. bush. the only time in my 31 years in congress when israel was frustrated at trying to get a policy through the congress was when president george h. w. bush ordered w. h., whatever -- [laughter] i don't want to denigrate him.

israel sought loan guarantees to do one of the great things israel has done which is to assimilate the immigrants and george bush because is talk shamir said this land will remain jewish as far as the eye can see forever. i try to ameliorate that by staying shamir at that point was very short and very old and probably could not see that far. [laughter] the fact is that bush was able to block us from getting the loan guarantees, damaging israel. you also had the famous, and a remember anybody an obama administration been as openly negative about israel as secretary of state james baker when he said, if he wants to make peace call me on television and in fact there was one example in which the obama administration delivered for israel as well as any president ever had. go back to a year ago and go back and look at the papers and there was this notion that there

was going to be at the u.n. a successful move by the palestinians to get their statehood recognized and there was the fear, the assumption was that was likely to happen in the fear was americans would have to veto such a resolution in the security council. clearly we were going to veto it but it would have been a american israel against the world. the obama administration went to work and one of the most successful examples examples of diplomacy i have seen, the obama administration pulled out all of its blocking steps. some of us helped, those of us who had congressional contact with the obamas administration successfully lobbied to the point where they could not get in the security council a sufficient majority so we had to veto it. it was a big victory for israel and an unexpected one, one of the few israel had been able to do in the u.n.. [applause] and i will close with this. the fact is that obama's credibility to do that was in fact enhanced by the fact that he has been critical of some elements of the settlement

policy. the notion that you are only a friend of israel if you agree with everything the israeli government empowered us at the time is not just wrong, it's counterproductive although many of my friends on the right who now thing, now think you can never criticize your government. i remember people attacking bacon over camp david in a whole bunch of other things but it was precisely because obama articulated the position he did that there was a problem in the settlements and there were too many. there was mistaken phraseology and i think he corrected it but i think his separation from the government with every aspect was one of the things that edited the credibility so his administration was able to clear up one of the few diplomatic successes at the u.n.. >> party, thank you. [applause] >> we now give till and opportunity to respond. >> i think it is revealing that barney has to attack the george h. w. bush of administration. the big stories the republican party has become a reagan

republican party with respect certainly to israel and not a bush baker republican party. i served in that first push of administration and argued with president bush that at the end of the day bush did the right thing in the gulf, which helped israel and the purpose of israel but the first gulf war, helped israel's security a lot and some people were opposed to that war. they weren't republicans but so i would argue objectively having bush in the white house was actually better thing than having michael dukakis in the white house. just as richard nixon who is no great friend of the jewish people and did not get a whole lot of jewish votes. an awful lot of shoes were happy that richard nixon was president of the american not george mcgovern. the current republican party much to barney's distress is not the bush baker moderate and republican party full of air of this and very close to -- the current republican party is a strongly pro-israel party. barneys problem is that it is to

israel. they give the israeli government did benefit of the doubt. it's across the green line and existence in 67 and in the area that will of course be part of israel under any conceivable settlement including bill clinton's settlement when there's a peace deal. no the obama administration had to make a big deal about that apartment building so i'm happy to defend the republican party to saying that romney will be a more reliable friend of israel and president obama. [applause] speier response. >> no it's not a reagan republican party. is to the right of ronald reagan on issue after issue after issue. ronald reagan asked congress to raise the debt limit several times. he thought that was rational economic policy. these people that are now running the house republican party attacked them in a romney willing to accommodate the right wing very enthusiastically actually attacked rick santorum

because he had voted to raise the debt limit at the request of ronald reagan. this is not a center-right party. as to israel, what is the most effective way to defend israel? i've been going to college campuses working with a pet. i've been to berkeley california and i've been to brown and to georgetown, yale to defend israel and i do it from the left in part because one of the things i want to give credit to as the netanyahu government. the right republican party, whether the history of the united states three government leaders have said pro-things from the house of representatives. bill clinton, barack obama and benjamin netanyahu made a very strong pro-gay statement. is one of the few times when the republicans did not stand up to applaud him. but the fact is that if your position is that you're just going to defend whatever the israeli government does, then your credibility as a worldwide defender of israel is weekend.

i do not think it is possible and the administration hasn't is hasn't done it to say it's israel's responsibility to get piece. what israel needs to do is make it clear that if there is not a genuine two-state solution with real security for israel it is not israel's fault and there are political pressures and here's the deal. there a clearly political pressures within that democracy of israel that i believe pulled them away from what is the most effective international advocacy and i'm very pleased to try and do some currying. in the end it's the israeli government. the obamas administration has taken note negative action against the israeli government unlike the bush administration. a rehab though is i think a much more effective way of defending them and the results are very clear. >> i just want to point out for the record that it is wonderful to have barney frank defending itzhak shamir and -- >> i was differentiating him from santorum.

he is way better than santorum. >> most of this prayer for bibi netanyahu to rick santorum. [applause] >> let me begin the formal questioning with you. each election we hear that this is the year that jews are going to shift their traditional democratic loyalty the republican party. and the just-released survey of american jewish republic opinion the jewish vote was split. as you referenced earlier about 61% for president obama and 28% for governor romney with the remainder undecided. what do you make of these numbers? is 2012 finally the year of the republicans? >> no, if you do the 61-28 and allocate the undecided, what about 8-4, you end up with 68-32 or 69-31.

i think that would still be progress over 08. jews conventionally learn from reality. takes them quite a while sometimes and i think younger jews and actually more affiliated jews will be voting more republican this year. it has been a long and full process for jews to what i regard as to shed some old-fashioned views about the bush republican party and about the republican party in the 30s and 40s but i'm not -- i don't tell people out of vote and how does vote on the basis of religion. people should vote on the candidate who they think will do the best job as president. i will point out one thing in the poll, these jewish americans asked on the most important issues 80% cite the economy 57% health care 27% national security, 22% u.s.-israel relations. of those who cite national security and u.s.-israel relations reading from the ajc press release, 42% of those vote

for obama and 44 friday by% will vote for romney. so if jews are liberals, they will vote for president obama as they should because president obama is a lot more liberal than president romney will be. for those jews from national security in israel trumps health care in and the economy, they are raking slightly for romney and i think that is significant. >> let me say first of all, the year we are waiting for has already come. bill may know the figures but 76, what was the jewish vote? the ford carter breakdown was clearly -- >> 80 was the last two were reagan got 40% of the jewish vote. >> i think the 70s too. yeah so we have been below that. i think the answer is, and this is very interesting, i think that there has been a misperception of the obama record. yes he was more critical of the

settlement. i have been critical of the settlements and i believe it makes me a more effective advocate for israel. as i said, i would go to an aipac conference and i'm told the young people that they get beat up when they speak for israel so i volunteered to travel and i've been to some california berkeley, not a right wing basket. and i talk about israel's domestic liberalism compared to its repressive neighbors in every area, but i also make it clear that i think the policy is mistaken and in fact week and israel. that is what obama said. i want to go back to this again. ask anybody to tell me the last time israel scored as well in the u.n. as it did when he kept them from getting a majority in the security council and i think that is enhanced by this fact of different. this notion that romney would be a better friend of israel for now, as i said mommy talk about romney there are no guarantees. there is no warranty on any

romney position but probably he would stick with it. the point is i cannot think of a single policy action for obama is not done what is in israel's clear interest. >> the ajc survey found that on domestic matters, jews remained where they have been for decades as we have been discussing. firmly inside the democratic party's cap. you are frowning, i know. i'm just resigned to it. speak you don't resign from it. we still want you. >> is that sustainable? if the majority of jews favored the democrats on reproductive choice and immigration, energy security, what can republicans offer to turn them in a different direction, bill? >> look, this is not about talk and imagined words. people aren't stupid and people have to work up their minds that these policies were. has he put his political capital on the line as president bush and senator mccain did in 2006

in 2007? it is labor that is now the barrier to responsible immigration reform. there are elements of the republican party that are bad on that issue. do you think obama's economic policies are working perfectly well and you think the government should have 25% of gdp and you think tax hikes would be good for the economy or bad? those are legitimate policy questions. you are all adults and you can make up your own mind. ..

>> i was called silly by the three stooges -- [laughter] and i mean that with no disrespect because -- [laughter] the three stooges, she howard was married to my cousin -- >> now, that's impressive. [laughter] >> we mefer -- never met, but the point is, yes, we've tried immigration, and it's the republicans demagoguing it, including mitt romney, who moved far to the right on this, but as to the border issues, i think, no. again, there was extremism -- this is not the reagan republicans. if you look at the house of representatives, the way they run it, they've gone far to the right, and the key issue i have

is this. one of the differences i have, some of my republican friends., we differ as to how much we should continue to maintain an active policy of america having this worldwide world ect., but here's the problem ment. i'm disappointed when people continue to make the mistake made in 2001 and 2002 believing it was important to be aggressive in the world and be in two countries and cut taxes at the same time. it's an entirely legitimate debate about being involved voluntarily, but to do that and cut taxes at the same time is irresponsible, and it means this. the republicans are critical. the ryan budget, and i'll quote the "wall street journal". they praised paul ryan because he was maintaining the military and resisting spending and cutting medicare and medicaid.

that's not me. that's the "wall street journal" thanking him. that's the debate i want to have. i believe we are overspending on the military, and it's time for the western europeans to do more on their own. that's the tradeoff. when you talk about an aggressive military posture opposed to tax increases whatsoever on anybody, as the "wall street journal" acknowledges, cheering him on, cuts programs and particularly medicare and medicaid. >> do you want to respond to that? >> well, ryan's budget does not cult medicare and medicaid, but cuts an unsustainable growth of medicare and medicaid. each of the deficits of the four years of the obama administration, 1.2 or $1.3 trillion. the total military budget all in with both war, and i proudly supported both, and barnny's for like a 25% cult to the military budget, and that's danger and

getting out of afghanistan immediately would be dangerous. that's a debate like he said. all wars, cia, is $700 billion. that's high. it's coming down. it passed the deficit. you can't solve the debt problem by cutting the military, and it's extremely risky in the world we live in to do so. i'm for strong development budgets, improving public diplomacy. we have to be, i think, if we don't lead in the world, it will be a dangerous world, but it's a legitimate debate, but nothing wrong about paul ryan. we have to sustain military spending what is a low percentage of gdp, reform medicare and medicaid, and we -- otherwise we're going off a cliff with the deficits. >> well, first of all, the military budget is $700 billion plus with intelligence and other things. it's big in the medicare budget. you can't solve it entirely for

the military, but you can't exempt the military. again, when i say the ryan budget increases military spending over what president obama has proposed, what congress temporarily agreed to last year and makes up for it by reductions in medicare and medicaid and it's quoted in the "wall street journal," and it's fro a month ago, an editorial there. bill said they are not cutting medicaid and medicare, but cutting the rate of growth. that's right. if you're saying there's less eligible people ten years from now, and we give them the same money as we are today, it's not a cut, if you want define it that way, it is a real cut. that's a big difference between the parties. it's a republican insistence that military spending go up and occupy and wars bring money. we continue to have the full set of nuclear weapons to defeat the

soviets 234 a war. to continue to be defending western europe because i'm not sure way. maybe another invasion, but it's not militarily this time, but socially. the fact is the average european nation, western european allies, spent less than half a percent of gdp on the military. i want us to be the strongest nation in the world by far, but we have an excess there, in other people's business, and, again, it's the "wall street journal" to protect the military against further cuts, and you make up for medicare and medicaid, their description of the ryan budget which ryan accepts. >> i have to say what's nothing on, quote, "defending europe," and i have no idea what you're talking about. they are paid for by the host countries. europe is costing us and nukes cost us little. that's not the driver of the military budget. do you want the ability to deal with iran, reduce troops if we have to use them whether it's in the balcans, middle east, or

afghanistan, and 23 you think that's necessary, i think you have a low military budget. >> i don't want to use trips, but the notion we are defending europe -- nato was a great move. nato is a mechanism for keeping european's military budgets low. we have a major presence in europe, and the planning is still there. in terms of the balcans, let the europeans take the lead there. we have wealthy nations in europe with a large population that's left all to the united states, and it's true. no one thing costs a lot of money. it could save, well, going back on the weapons. as the price of the radification in the senate of the nuclear weapons treaty last year, the republicans to keep it from getting or giving it the two-thirds vote, insisted on spending tens of millions more over the years on wasting it in the nuclear arsenal that others

don't think are necessary. >> let me move on. let me say there were cards on your chairs if you have questions you want to pose. please fill out the cards, and they will be collected shortly. we'll feed them into the debate. let me come back to israel. ajc's survey shows the obama administration's middle east policy gained ground in the last year among jewish voters with 58% approving and 48% disapproving the u.s.-israel relations. over the last fall, the results were 40% approving and 53% disproving. is this election for jewish voters a referendum on president obama's approach to israel. starting with you, bill. >> improving, you, now at 58/40 which is bad as we saw in general from jews, and the reason it's bad is the first year or two, he picked more fights with israel that citizens

rationally disapproved more of his policies because he's mugged by reality deciding he's not going to pressure the benjamin netanyahu government or negotiate with palestinian state with what hamas controls and various other pressures on israel. look, the reason they did a good job at the u.n., why was it produced at the u.n. for the first time ever? there was not the authority under bush u or clinton because they knew it was a non-starter, but president obama's elevation of the pal stippian issue and criticism of the israeli government and seeming to side with the europeans that they, the palestinians think they might be somewhere in the u.p., and president obama's administration did a good job of partly solving the problems they had partly created, but they don't deserve that much credit for that. they are better now than two years ago, and that's nice and important for israel and some of us on the outside continue to pressure them to do the right

thing both for the u.s. and in terms of the u.s.-israel relationship. >> barnny? >> is it a referendum on israel's policy? 22% it's particularly that. i say it was some extent to his decision making. the speech was badly worded, and they learned from that that rhetoric is important. public policy is important. you have increasing reck nice there's not been a single policy action less than fully supportive of israel, but i disagree with bill's notion it's because president obama elevated a notion of a palestinian state they decided to file the resolution. the palestinian state has been a strong aspect of every president for as long as i can remember, and going back to the first president bush and then bill clinton and then the second

president bush. that just is historical. there's been an evolution with the palestinian pushing for things, and pressured by peace, but, again, i understand the president caused himself some of the problems with the speech. i do believe, however, and i think this is a case where you don't always say to your friend, "wonderful, good for you," but sometimes the best act of friendship is, hey, you're making a mistake that i think harms your interest. the policy that benjamin netanyahu is pushed somewhat by israeli politics, and there's been negative aspects for israel in terms of world opinion, and i believe it's important to advise him of that. i repeat, i think bill is denigrating a great diplomatic accomplishment. go back and look at the media reports with the vote, and the assumption was it was going to win, and it was going to go to the assembly if it lost, and i believe it's the enhanced

credibility of the administration to stop it. i believe you saw the effects of badly worded speech wearing off. >> another foreign policy issue to which is iran. there's no bigger priority for hic than preventing iran from obtaining nuclear weapons capability. how do you judge the president's report on this vital security matter, and how would a republican administration's approach differ? starting with you, bill. >> well, just -- >> i got the last word -- >> sorry. >> last word is always better. [laughter] let me just, you know, it's a question of fairness. i think there's been a great deal of continue -- continue newty here with regard to the north korean's situation, and it's frustrating. one of the things we -- one of the great frustrations we tend to be self-critical on america more than we should be, but is

the unwillingness of russia and china to be more supportive of the effort to botch nuclear weapons. if i was russia living next door to iran, and some of the crazy people with nuclear weapons would make me far more nervous than it makes them. it's frustration to watch and constraints on our policy that we have to deal with. given that, i believe that what we have been doing is the best that cab done. i'll tell you when the obama administration took over, i was approached by pictures of the israeli summit asking that i intervene to make sure stewart levy continued to be the head of the sanctions in the treasury. he was a bush appointee, but i did that, he was kept on. i believe we've been doing as much as can be done keeping the military threat on the table, and i cannot -- i would stress if you look at the bush administration policy and the obama administration policy, i

think they are very similar because they are dictated by the realities. >> i agree with that aspect of the obama administration policy towards iran and those who continued the bush administration policy. that's true in general. best policies are given out of campaign promises and followed the bush policy and keeping stuart was part of that. look, i think obama's changed a lot on iran. look at the cairo speech from the summer of 2009 and regime attitude towards the middle east and muslim world and what he said about the iran and what he did or didn't do in june 2009 with the green revolution erupted and green movement took to the streets in iran with no support from us, and look at the speech from a couple months ago saying what we've been saying a long time that you cannot contain, reliably detain or detour this iranian regime with nuclear weapons so they have to be prevented from getting nuclear weapons. u.s. policy to detour on

containment, and then there's the question whether sanctions prevent. i believe they will not, but they are weakening iran in some ways. the policy will not prevent, and that's necessary for us. i think the administration should take more time thinking that through and preparing for that and a little less time evading obstacles to israel if they feel they have to do that. obama add moved on -- obama has moved on iran, and i hope he finishes the job of preventing iran in the foreseeable future of getting nuclear weapons. what strikes me is the initial insings coming in is his view of the world and cairo speech and tehran in the summer 2009. >> well, first, there's nothing to suggest bill throws away. i wish he'd spend, the administration would spend time thinking about the military effects of iran. that's unfair at the people of the pentagon.

they are dealing with it. i don't think you meant that. >> the people in the white house are leaking things to try to prevent israel -- >> two separate things. you are degrading one of them. yes, there's question of restraint about israel which is coming, of course, by major military figures as well. there's a thriving debate in israel. the suggestion that you said more time planning the military possibility, israel, aing it is inaccurate. secondly in terms of change, i think people over interpret the language, and it's been consistent, a grudging accept taps of the fact that the current policies are okay or substantial, but you have to criticize the fact they were not always his policies. again, back to a kind of, you know -- the advocate of mitt romney to be attacking anybody to change positions or impugning

that it was out of reach. >> let me pick up a question we've received from a member of the audience. starting with bill, bill, please talk about your support towards the emergency committee for israel, displaced advertisements and niewps, -- newspaper, and how you relate to its importance to turn, in some sense, israel into a partisan political issue. what do you hope to gain? that's a question from the audience. >> israel, and i'm sure you don't know what it is, it's a very small, organization that i'm chairman of formed in, i guess, early 2010. the obama administration and parts of both political parties, but up fortunately democratic parties not strong supporters of the traditional u.s.-israel leadership. we put ads in papers, did appropriate, you know, legal interventions, and political campaigns. we strongly criticized some

democrats in the house and the senate, and some republicans. there's fewer republicans in this camp who gone into jay street, peter, you know, all diplomacy, and they spend time criticizing the benjamin netanyahu government or spend adds much time criticizing hamas and the palestinian authority for the impasse in the peace process and trying to prevent keeping the military option on the table with respect to iran so i think i'm pleased we had a little bit of impact with the emergency committee on israel. i think we may intervene with one or two democratic primary bases in new jersey between rothman, and there's a strong israel democratic in the house and another who has been a jay street democratic. i think you'll see emergency activity for israel. we're not partisan, though it happens, but it just is a fact. the republican party has been pretty well marginalized.

barney and others fought hard to marginalize the democratic party, but it's bigger in the house of representatives, and i think it's more of a problem, therefore, for the last, and i hope liberals marginalize their own elements of the party as we start to do in our party. >> the fact is that you talk about minuscule is bigger than microscopic. the democratic party has been supportive of a policy that republics israel's right to an independent, democratic, jewish state. you're talking about in the house of representatives, ten, twenty, maybe 25 votes, very small minority, a couple republicans, four democrats, but this notion that the republicans have marginalized and the wing

that's critical of israel to the point, and i guess here's the difference. the question is do people take their differences with the policy of any israeli government? conservatives has been criticizing the israeli government on a range of issues thinking they went too far. do you translate that into actions that deny israel actions in foreign policy or aid, ect.? the answer is that neither party's wing that's critical of israel and unwilling to support has had little impact on policy or whatever. when people take credit for the fact that obama is pro-israel, we are talking about an elephant stick. an elephant stick is a guy walking around central park with a big stick and people say what's that for? to keep away the elephants. there's no elephants here. he says, yes, because the stick worked. [laughter] i don't think obama needed that. during the time when people interpret the speeches that way, i, from the beginning of this

administration on foreign aid and everything else, i have seen no actions taken by the obama administration or anything less than fully supportive of israel's legitimate needs. >> another foreign policy question. across the wider region of the middle east, over the last 16 months, the collapse of long established regime, and we continue to watch syria. has the obama administration been fast enough and wise enough to the people. do you want to start, barney? >> there was a tendency for us as a country to say, well, everything that don't go right is our fault and our responsibility. we have to deal with it. the arab spring has been a serious set of issues for us. the notion that democracy is a good thing i believe in morally, but not always created the

consequences will be of the right sort. what's happening now in egypt is troubling. people talking about cutting off the contractors, and one of the best things that happened in the middle east was the campaign agreement and agreement of both sides to the extent that's called into question that's deeply problematic, and i think the administration has been dealing with it fairly recently, and be clear as people pointed out, that this administration, nor i believe any republicans' administration, has shown great eagerness to urge bahrain or saudi arabia to join the push to democracy. again, reality constrains, and i think the problem here is not party differences, who would do what, but how do we reck size -- reconcile our deep belief in democracy and human rights? the concerns about the negative as pelgt about what happens -- aspect about what happens. a democratic principle, a good thing, that the palestine yab authority had elections, and

hamas won them. that was not such a good thing. that is -- i have not fully workedded that out as so what you do when elections are going to bring about negative consequences so i think it does call not for a before it, but give serious thoughts what's involved. >> could the u.s. have steered the outcome what's happening in egypt with a slightly different directions and different policies in the revolution? >> hard to say in retrospect let aloin at the time. there was a forward leaning policy there, but i agree with barney here. it's a tough policy. it's split in both parties and different groups and most of the foreign policy communities in the matter on how to handle this, how much you really have. on part of the antisaudi arabia wing of the democratic party, i agree that's a very minority view in both parties. seems to be something about the saudis that causes people when

they are in power to really decide it's a wonderful place, and we have to be extremely nice to them. if we had energy development at home, we'd have to be less nice. >> i think it's culture from lawrence of arabia. [laughter] >> i would say this. the arab spring is complicated. i've been on the more hopeful side of those looking at the arab spring, and we don't have a lot of choice. we're not propping up dictators against the public. they fell back after egypt, and this is not a part of it at all, just a failure of government bureaucracy almost, could have done more on the ground in terms of economic development. there was efforts in congress, bipartisan, to get serious economic development aid in, make sure the public didn't have the view that the only people here to help us are the muslim brotherhood. it's a case where the u.s. government, honestly, has not adjusted to new realities as well as it should. has not under the bush or obama administration. one of the things i would

criticize the obama administration for, and it's not partisan, just a kind of government management thing, is they talk a lot about soft power or hard power opposed to bush who just used hard power. they have not reformed the u.s. government as much as they should have. it's not a very well-run -- i think people not just a well-run agency, but a development agency, and it's money doesn't go as effectively as it could, the public diplomacy diplomacy not as improved as secretary clinton had hoped. i think the one place where i would be with bipartisan letters urges the obama administration to be forward leaning is in syria where it's a complicated situation, but an ally of iran, a terrible government with human rights and democracy, and it's a strategic envy of ours, and we have to be more there to try to

effectuate the government, but they have not done much to try to make it happen. >> what would you do? >> some kind of what we do in libya, no-fly zone, no-drive zone. >> i understand that. one of the criticisms i make of the people who advocated that. there's people in syria, and at some point you expand the military reach, raise taxes to do. that there's a problem for those who are advocated, and i don't mean bill here, but voters who want to do more militarily, but forget about it. the other thing is. there are great doers. the development aid, we wanted good old-fashioned walking around money, and it's hard for a government to do that, totally non-partisan, not everything

that goes wrong is the fault of the incumbent administration in the world. we have been guilty of it ourselves taking on the responsibility. you read a newspaper, where was the american government? the american government was in washington trying not to think about what to do. we should not get ourselves put in the position whereas this expectation that america resolves every problem everywhere in the world, and then that's -- i think it becomes an unfair metric for any administration, and it's used unfairly by both. >> okay. [applause] a question from the audience about iran. sanctions against iran do not work, how long do you wait before pursuing military options, and do you see differences in the timetables that a second obama administration or a romney administration would apply? >> well, you know, this is one of the things you really can't

predict how an administration behaves. a new administration often do things people don't expect them to do. i believe, you know, governor romney spoke clearly about the unaccept the of iran -- unacceptability of iran with nuclear weapons. they don't sound that different from each other. depends on one's judgment what is passable with iran getting close to break out capability, what's acceptable for israel opposed to us because we have greater capability. i believe in military force is used, it's better to be the u.s. military force. it is our responsibility. you can't do everything everywhere in the world and don't blame the administration for everything that goes wrong, bush or obama administrations for everything that goes wrong, but there's basic thinged we have to do around the world r and one is to try to maintain some lid on nuclear proliferation and on the worst

regimes, radical regimes getting hands on nuclear weapons. i believe iran with nuclear weapons is a game changer. israel and iran being in a missile crisis situation. an ability to put an umbrella on terror sponsorship is harder to detour them. it's a huge issue, and, you know, the romney administration i trust to handle it, and if obama is re-elected, i really hope this hoppestly that he does the right thing and does the right thin in the next several months in the election campaign if it comes to that. >> barney? >> unjustified partisan thing at the end, there's no, again, there's no real difference between the two administrations. the president said clearly, rule out containment. that means you should take military action because that's the other option. as to when, and i think there's no difference between

administrations, and you are now talking about probably the most serious military undertaking since vietnam. i think that, in fact, taking on the iranians and their nukes it more of a deal than going into iraq. in terms of iran's capabilities elsewhere, and what you have to do then is careful planning in conjunction with all middle east nations with which we are aligned. the israelis, the saudis, others. have to worry about an iraqi government we helped install, which is iran's only other good friend in the middle east, and we need to do serious things. this is one either president says to the pentagon, okay. we're at the point where we have to act we're told. they're about to have a weapon. what can we do? that means planning for military action, planning in conjunction with the other nations, their defenses. it becomes a very complicated

situation for obama at that point and any president would be working with his defense and intelligence establishment what to do. bill has a good point. it is unfair for israel to take on this burden. what have we learned from the wikileak's situation? put a lot of people in danger, but we learned how scared many of the arab states are of iran. this fear of iran, wish that somebody would do something about iran goes far beyond israelis, and it's unfair to put the burden on israel now. >> we pick that up in, in fact, in many conversations around the arab world as well. let me turn to a policy question. we've encouraged energy independence for countries since the 1970s. better for the environment, of course, better for the economy, and better for national security. if we end our dependence on

petroleum supplies from hostile states, is that a goal shared by president obama and governor romney, and how can we best advance towards that goal? bill, you want to start? >> full independence is not realistic. there's no problem importing energy if it's from reliable, friendly nations, especially neighboring nations including canada where we have an easy opportunity to build a pipeline which most people, including a lot of labor unions support, and obama stopped it on environmental ground. environment is good, no tension between us, but, of course, i don't know that the environmental concerns are legitimate, but to the degree the environmentalists believe it's legitimate, and they are an incredibly powerful force in the obama administration, they are obstructing development. there's no serious question whether it's offshore, government lands, one of the

great thing that happened is the natural gas breakthrough, the fracking, in north dakota and south texas. we would be developing much more oil and natural gas in the country if we didn't have excessive environmental regulations, which the obama administration has come down on the side of the, what i call the extreme environmentalists, against those who would like us to develop more energy here. >> first, again, we tend to be too negative. we have been making progress. the dependence on foreign oil dropped some. it's right. not everything has to be produced in -- we have mexico, canada, others. there are more drilling and production going on right now than there has been, not on government lands, but the overall totals are up. alternatives are a part of it. one of the things i want to say is this, and we can be -- there was this notion that the fact that we have to import oil from

the middle east frames our foreign policy. i have not seen evidence of that. in fact, one criticism i have of some of my colleagues who want to bomb iran immediately, there's no question. the fact that it is american policy contemplating a military attack on a nuclear iran facilities, but the fact that policy is tough on sanctions is a contributing factor to the price of oil and it's important to understand that. not the hugest factor, there's others, but i think the good news is that the fact that we are doing, with regard to iran, some upward pressure on oil prices not detoured political faction in america from moving forward with it. good to reduce it, but i think we have overestimated the extent to which that's a con straint on foreign policy. >> thank you. before we go to closing remarks, this is 5 question that came

from the audience that comes to a question of america's role in the world, america's speedometer in the world. over the back ground of war in afghanistan and iraq, there's parties to turn homeward, to fall back from foreign troubles and foreign commitments. what are the reasons, strategic and moral, to justify america's efforts to remain the world's greatest power, and what do you say to those who go to the polls in november that fixes our own problems is first priority? >> i think they should be a priority. i'm one who believes we can substantially reduce a worldwide military expenditures at no cost to the security. there's an element of people in the argument for maintaining the status quo and even as the republicans do going beyond, increasing military spending, unlike what we now tried to restain it. i want to restrain it more. what we have is this notion that

it's part of america's purpose, that america shouldn't be -- talk about it in eng land, a nation of shopkeepers. we have this miranda moral responsibility to be the leaders. i think we overestimate the ability we have to do that. i would be morally conflicted, and i don't think we should be trying to build an afghanistan and iraq, a good democratic society because i don't think you can do that with the military. i think we have a military that's very good at stopping bad things. not a good instrument for making good things happen in a socially complex way, and i think those things are overdone. secondly, you have this allies on us, and there's a much greater role to be played. maybe it was a good example for the europeans to take the lead, did a bad job in some ways, but insist, for example, in the

mediterranean, no reason why france, germany, italy, england, and spain can't play a more aggressive role. some of that is in africa. we need to pay more attention to home. reduce the deficit, i fear we have to sustain military spending some, increase taxes on wealthy people, and cut domestically. that's the difference in the parties. the republicans, no, forget about tax increases on wealthy people. forget about the military. in fact, you have to spend more. take it out all of programs that enhance the quality of life here, and i think that's a grave error. >> thank you. some of the countries we want, perhaps, to assume a greater role in defense responsibility are strapped themselves, however. >> yeah, but we're -- we are also strapped in said defense. i'm not talking about poor countries. i'm talking about germany, france, italy. they have a temporary problem, but they pay much less than half

of their gdp built up with 4%, less than 2% of gdp. yeah, they are strapped, but here's the problem. if you look at the programs that they have, medical programs and others, there are people who are giving their own citizens substantially greater social benefits than we give our citizens, and that's probably because of the military budget. it's fair to ask them to pick it up. when i ask them to subsidize, just be self-sufficient. >> bill? >> one of the preconditions of a strong america abroad, which i'm strongly in favor of outlinedded with the "the world america made," and president obama and governor romney, i think the world would be just a -- will be more dangerous if the u.s.

retreats. get allies to do more? perhaps. strong alliance structures around the world? i believe so. you can wish that germany and sweden and italy and spain, and perhaps they have more defense, be more responsible in stopping genocide in africa or the balcans or helping israel out, but the wishes are not worth much, at least not in the near future. every administration tries to go to europe to make them spend more on defense. it does not work. they're in the position they spent so much on welfare states they are going broke and bankrupt doing that as well. that's not a sustainable model. i think one of the cases, if you care about americans around the world, one of the cases for real reform at home is we have to be strong at home to be strong abroad, but i think the world in which we retrieve, a world in which we cut defense by 30% and pretend we have security guarantees, keep the peace in asia, keeps something like peace in most of the middle east, i

mean, they keep peace even in the balcans, that's not practical, and it's too high a risk to run, and fortunately, president obama seems it is too high a risk to run. there's already damage, but he's rejected those people within his party who wanted a complete withdrawal from afghanistan or radical cuts from the defense budget. >> bill, is there a difference between the parties on american exceptionalism, on american responsibility? >> i don't know about that. american exceptionalism is an interesting term in political science and history. i sort of don't like it. it's particularly used in debate. i just don't know what people mean by it. america should stand for american principles. republicans have a more robust, vigorous, use less nice adjectives, interventionists or -- what's improvise for negative adjectives, but a view of america's role in the world

generally, but there are as many democrats who shared the view, and there's some republicans who dissent from the view. there's a difference on defense policy with president obama and governor romney. it's not going to be governor nixon, reagan, or carter. i'm happy about that. i'm happy the obama administration moved away from what was an early view of the world and to a more interested interested -- i worry about certain aspects, and especially about the defense cuts, and i think the public administration with mitt romney as president and joe lieber man with secretary of state is a better foreign policy administration, and obama's second term, and i would say second term is different from the first. he's come back -- let's not kid ourselves, he came back to the center because of political pressure and the 2010 elections and partly concerned about the

2012 elections. it's not just a republican talking point saying he was overheard. hey, once the last election is over, i'll have more flexibility. it's a question for people to ask as they think about who to vote for. >> we're merging into the closing statements, and in some sense, i guess, bill, that was about a closing statement, but i want it not to be. if you can continue for another couple minutes, and then you have a few minutes, barney, to conclude the debate. not just foreign policy, but another question as well, bill, just wrap up the case for republicans in 2012. >> look, i want to make the case for being open minded, and there's three debates. conventionists by governor romney and president obama in late august. there's a vice presidential pick by governor romney first and three debates, i assume, like the last couple elections, between romney and obama and vice vice presidential debate.

go into those with an honest, open mind. people don't, you know, people have strong views one way or the other, they'll be committed, but there's a fair number of up decided voters, and people have to take a look and decide whose policies make more sense in terms of america's future, in terms of reducing this terrible debt and deficit, in terms of a strong foreign policy, and whether the obama administration was successful administration or not, and what a second term of president obama administration looks like opposed to a romney administration. my plea to a community that may to some degree have a mind made up, but it to be open minded, think hard about the choices ahead. don't think about george hw bush or -- i'll promise not to raise the issue of george mcgovern if he does not raise the issue of george hw bush or baker. take a look at the real choice before us in 2012. >> thank you. >> can i ask bill one question?

[applause] i just -- [applause] i was impressed with bill's urging to be open minded. are you open minded approaching the election, are you open minded? >> i've been open minded. we praised the obama administration. >> you know who you're voting for happen >> i'm partisan and others are not. you know who you are going to vote for. >> i don't pretend they should be open. if you have decided views about governments of public policy, and you don't know know now whether you vote for obama or romney, something's the matter with you. [laughter] >> i think that's really a foolish statement. i know people including people who are close to me who they don't know who they will vote for. they are not stupid people. they are conflicted. they agree with obama on some and romney on others. it's not unreasonable thing to

do. [applause] >> that's not open mindedness. that is different -- [applause] that is difference. there's a small number of people who tend to have conflicting views. what you're saying is be open about the whole thing, see who is on what side. in fact, most people who are following things closely will know who to vote for. there's no surprises coming. read the focus groups that they do in october of the undecided voters. they are not an impressive group of people. [laughter] first of all, they don't know a lot of things that are true and more frightening, they are convinced ofen fantasies. let me go now to talk about the election. i want to say that i think bill's guilty of campaigning by inknew -- inuendo. not a single public policy has he shown or eluded to that obama

was too far to the left compared to where he is today. complaired -- compared to foreign policy in 2008, he was criticized. this is a myth that, oh, obama moved to realistic positions. there's no daughter and -- drastic changes. i want him to move out of afghanistan quicker, but this notion that he was further to the left, and israel, nothing negative, and what we have today is not a reagan republican party, but a republican party that is to the right of ronald reagan where mitt romney attacks santorum who voted to raise the debt limit. people vote for expenditures and no tax increases. in the ryan budge, and, again ryan's assertion, increase military spending so we can make cults on what otherwise would be there on medicare and medicaid.

it's a radical agenda in the social area with regard to the rights of lesbian and gay people, with regard to women's reproductive rights. on immigration, they have been anti-- the administration not as successful in getting a rational policy, but that's in part because the republicans have been so opposed to it, and a number of people are frightened. one of the things happening with regard to immigration that bilingualism is creeping in the republican party, and they are learning to count in spanish. that's having an impact. you have a very clear choice between a very right wing discipline on the right side, and an administration that inherited problems and made progress in about all of them. i hope people, in fact, having looked at the issues decide it that way. >> thank you, congressman. thank you, bill kristol. thank you, all, wering if a part

of this great debate. make sure you please stay in your seats as we're about to begin the next portion of the program. please stay while the others come out. [applause] glue here's a look at the live programs today across the c-spa:

>> the administration is requested over $10 million to support drug education programs and to fund expanded access to

treatment. from the center for american progress here in washington, d.c., this is about 48 minutes. >> sharing the concern that i think many of us in public health and the safety community share about drug policy. over the past few years, this public debate on drug policy is between two views. let me characterize the views for you. on the one side, we have a very vocal, organized, well-funded advocates who insist drug legalization is a silver bullet for addressing our nation's drug problem. we have the other side. the other side of the debate are those who insist that a law enforcement only war on drugs approach, the one that was just mentioned, is the way to create a drug free society. you know, if only we could spend more money on prisons than enforcement and increase arrests

and as logic goes, the drug problem at some point will just go away. the obama administration strongly believes that neither of these approaches is humane, they are not compassion gnat, not realistic. probably most importantly, they are not grounded in science. the approach is also does not acknowledge the complexity of our nation's drug problem or reflect what science has shown us over the past two decades. whenever you can put the answer to a complex problem on a bumper sticker, you know you probably don't have much of an answer. that's why two weeks ago, we released the national drug control policy and it pursues a third way for our nation to approach drug control. this is a 21st century approach to drug policy. it's progressive. it's innovative. it's evidence-based, and it represents what we believe is a way ahead for drug policy. you know, along these lines, i

was very pleased sunday night to see the "60 minutes" piece featuring the staff at the national institute of drug abuse. the piece really showed the institute's ground breaking work in the science of addiction in reflecting what we learned about the disease and highlighted the future direction of drug policy. now, in fact, at the national institute of drug abuse is the source of 85% of the world's research on drug abuse, and we can see more about how it does that. i recommend you all take a few minutes to watch that "60 minutes," and if you have not already, the link to the video is on our twitter feed at oendp. why our policies could not have come at a more important time. today, more than americans are dying from drug induced deaths than from any other form of

injury death including traffic crashes and gunshot wounds. while making matters worse, drug use among young people increase and reductions of harm regarding some drugs are weakening. apart from its impact on the health and safety, our nation's drug problem also continues to place obstacles in the way of our economic prosperity. just last year, the department of justice released data that the health, workplace, and criminal justice costs of drug abuse to american society sold $193 billion, and that's using 2007 data. contributing to the immense costs are the millions of drug offenders under the supervision of the criminal justice system. from states and localities across the country, which is where the vast majority of where this work is done, the cost of managing this system has grown

significantly. these facts underscore the need for a different approach to drug policy, one that creates drug addiction as a disease and promotes a criminal justice system where drug related crime is treated in an equitable manner for every american. simply put, almost all of my colleagues say repeatedly that we cannot rest our way out of the drug problem. that's why we are taking action to reform our public health and safety systems so that we can learn to recognize the signs of drug addiction and intervene before it becomes a criminal justice issue. before i talk about the approach, let me take a moment to give you some facts just about how we have accomplished these changes in reforming the system and trying to restore, trying to restore a balance to a drug policy over the last three years. in 2010, president obama signs a

fair sentencing act into law, the first time in four decades that a mandatory minimum drug law has been rolled back. this was an important and long overdue criminal justice reform, and it dramatically reduced the 100-to-1 disperty of sentences between powder and crack cocaine that affected minorities. in the past three years, we've spent more than $31 billion to support drug education and treatment programs more than what we spent on u.s. federal law enforcement. to break the cycle of drug use and crimes, we have worked to divert non-violence drug offenders into treatment instead of jail through drug courts. there's now more than 2600 of these specialized courts across the nation diverting 120,000 people annually. i had the great opportunity to work for the attorney general janet renaud, and to see the

expansion is amazing. to see the drug court program in seattle, the changes that have been made is loutly heartening. when anyone says government doesn't listen or that government taxpayer dollars are wasted in this area, i just ask them to go and attend a drug court graduation. if you're not moved and motivated by that graduation, well, you have a pretty cold heart. during the past three years, we've spent this money to increase a number of programs that support education and treatment, and to break the cycle of drug and use of crime, we put into place policies and procedures that actually help to intervene early. we provided more than $370 million and drug free community programs to give to over 700

local coalitions made up of organizers working to prevent drug use among teens. those grass root efforts are important. they are the way that are backed up with evaluation and research showing young people exposed to those programs are more resis tent to using drugs than those who have not. recognizing the drug use is a public health issue, the obama administration last year released the first ever national prevention strategy which calls for eliminating health disparities and increasing education. well, the health left the stigma associated with drug addiction and supported millions of americans in recovery from drug and alcohol addiction. we created the first branch here of national drug control policy. internationally, we devoted more than $1.2 billion during the past three years to alternative

development programs providing economic incentive, and they have increased security to farmers in drug producing regions of the hemisphere. three years ago, the obama administration became the first in history to lift the long standing federal ban on needle exchange programs. unfortunately, congress has reinstated that ban through a policy writer on an appropriations bill. the strategy we just released builds on this record of drug policy reform, and it outlines more than 100 specific actions that will realign the way we deal with our nation's drug problem, and i encourage you to look at the document, and i encourage you to look at the action items that spread across all of the continuum with drug policy and the complexities dealing with it. for example, our policies include support for programs like screening, brief intervention, and referral to treatment. that works to medicalize our approach to the drug problem by

helping health institutions recognize the signs and symptoms of drug addiction early. i wouldn't be a good federal employee if i couldn't make an acronym out of that, so there is an cairo speech anytime. most people see a health care professional about once a year, and in that confidential setting, hopefully that health care professional through programs will have the tools and information that they need to make an accurate assessment regardless of why that person is visiting that health care professional, to make that accurate assessment whether there is a substance abuse problem. we know if they ask the right questions and people trust their health care professionals that perhaps an intervention can be started early, and we know early interventions work better, and early interventions are more cost effective.

these are important issues around the health care area. the strategy just released builds on the record of drug policy reform. it outlines a number of these important actions, and it's really important, i think, that all of us recognize, again, what i went through the entire list, how it helps us to frame and understand the complexity of the drug problem. let me give you another, what i think is an excellent example, and that's the affordable care act. it is revolutionary because for the first time it makes drug treatment a required benefit for all americans who suffer from substance abuse disorders. it is important, of course, for another reason because it helps to put drug policy initiatives that are in the health care system, not in a specialty or in a silo, but in the primary care area. the strategy emphasizes the importance of bolstering efforts to prevent drug use before it

ever starts. what an innovative idea and good prevention, but it's very difficult to get funding and support for prevention, and that's why we're working so hard to help people understand why it makes so much sense. we support the youth campaign and drug free community support program. these programs help ensure every new generation of young people have the opportunity to reach their full potential free from drugs. as i have the great opportunity on behalf of the president to travel around the country, listen to high school students, and listen to parents, it drives that point home every week to me is i get on an airplane and i meet with people about how important it is for this future generation. ..

>> to secure the southwest border by providing support to historic levels of personnel, technology, infrastructure, that have been deployed and that are strengthening, and we are also strengthening those international relationships. the strategy looks ahead to the future of drug control reform. these are important and their innovative programs that are taking hold in local communities across america. the local community is where i spent by far the vast majority of my career. "the wall street journal" recently brought attention to some of these programs in an essay by drug policy expert mark

klein, jonathan hawken and this piece argued there is no quick fix to the complex issues of drug abuse and prevention. we agree. these experts pointed to the success of programs such as the drug market intervention, which closed down open-air drug markets through community-based strategy, and they offer drug offenders a second chance. they offer drug offenders a second chance before there ever a arrested, before they ever get that record against them. another one, hawaii's project hope probation program dramatically reduces probation violation through swift, predictable and immediate sanctions. these programs have demonstrated record of success not only in dissipating criminal activity, but also and probably most importantly, building community. let me close by saying there's real reason to be optimistic in

this reform, that this reform will reduce both drug use and its consequences on society. as a longtime police official, police officer, police chief, my profession actually isn't noted for a lot of optimism, but, in fact i will tell you the citizens, during these three years that i looked at the changes across this country in the way we think about and address and deal with our nation's drug problem, i am optimistic. but the recent data also supports that optimism. meth and cocaine use in america are down dramatically. let me repeat that. i don't think you heard that. meth and cocaine use in america are down dramatically. and since 2006, cocaine use in america has declined by 40%. meth use is also down by half in the same period of time. and surveys show that despite recent increases in the use of some drugs, fewer young people

are abusing prescription drugs, additionally about 120,000 people each year are referred to treatment instead of jail for drug courts, and we know from the most recent evaluation done by the urban institute, the drug courts not only save money but they are also effected. and last year for the first time in four decades, the state prison population declined. i believe we are on the right track to reduce the consequences of drug use and drug trafficking. with that, i think i have prepared well for questions. i went out and had a root canal a couple weeks ago, so i wanted to be well prepared. and key. thank you all. [applause] >> we will take, i'm going to ask some questions, and then we will be taking questions from the audience but if you could just write out your questions

and write them as legibly as possible, and it in for yourself, that would be very helpful. thank you. thank you so much for your remarks, and i'll just start off with a few questions before i get them from the audience. you said the war on drugs metaphor does not address -- the administration. why do you say that? >> i think the war on drugs is this been sold the american people that we're actually going to win this. our goals which are very wall street and the present strategy are very clear, about reducing drug use and importance of reducing drug use across all levels. whether it's with youth, whether it's a horrible prescription drug problem, whether it's reducing drug driving which is another issue that is out of and, of course, most recently where dealing with our synthetic drug problem. so these are all important. when we called a war on drugs, we don't give it the emphasis and focus, frankly at times the resources that are needed to

deal with what really is a very complex public health and education and criminal justice problem. so we would really like to ban that phrase as much as possible. >> and when you talk about the public health issue, and moving it from, you know, a war, like a war metaphor towards a public health issue, that means moving more towards treatment than the incarceration as a first step. so what are the other steps you are taking from your vantage point to really keys that idea, public health? >> i think that's exactly right. one of the three signature initiative that we put into place was to deal with prevention. convention doesn't get the level of support and understanding. and i guess my experience as a police chief would tell you that, no one ever came up to me and patted me on the backs of

low, you guys are doing a great job preventing crime. it was always about how fast did you react, did you arrest the perpetrator, did you get somebody's property back. when, in fact, prevention is the key. and we know that prevention can work. what we've kind of fail to recognize also is that the research and information around prevention has really increased demonstrably over the last couple decades. prevention programs can be very cost effective. people often don't think that the kids listen to their parents, and, in fact, the research tells you that kids to listen to the parents. but they also listen to trusted messengers. coaches, teachers, law enforcement officials, and others, and if the message being given to the young person isn't one about a scare tactic, and it's more about his information to help you make good decisions to be in control, i think that's

absolutely critical. we just failed to get the attention, the prevention we should. unfortunately, even this new national prevention strategy, chaired by the surgeon general, really talks about how improvements in health can be made. answering the drug addiction is an area that needs of the. >> are prevention dollars at the state of local level in these tough times? >> i do. on the one hand, i have not met with the governor or state legislatures in this last three years that have not looked at trying to reduce costs, particularly in the criminal justice area. one of the concerns i have though is that as they reduce cost, that they need to be cognizant of the fact that those cost savings need to be put back into the aftercare service. they need to be put back into treatment behind the walls for those people that have been incarcerated. people need to get back into

housing, and that's what i was so impressed with secretary shaun donovan and his letter to every public housing authority administrator in the country, saying their sniffs about when a person can get back into public housing. quite often there are restrictive rules that are not grounded in law. these are all important issues when it looks, and we think about how we are going to deal with this in a more holistic way. >> one argument that i think resonates possibly more now than it has in the past is arguing that prevention and treatment can be more cost effective for states than in incarceration. are you seeing sort of maybe some governors who may not be, may not a been receptive to this argues in the past being more open to the now? or do you think the conversation has shifted in communities themselves where we are seeing real results? >> i think the communities have always been understanding that, because when you look at people that are released from custody

every turn back to their same neighborhoods. and so the people understood it. and you know if the people leave, sometimes the elected officials will follow a long. i would tell you that i've never been more hopeful and talking to governors, regardless whether they have a d. or r. after their name. let me give you one example. so governor deal is a pretty conservative governor in georgia. he carved out $15 million out of his very tough state budget to increase treatment programs. i think he understands it well from his background. i think he understand it quite well also because his son is a drug court judge. >> oh, interesting. that is interesting. i'll just give one a more passionate one or two more questions and then i'll take questions from the audience.

on the issue of marijuana. the president made a distinction between large dispensers an individual marijuana use, in his interview in rolling stone. many people raise questions about in these type budgetary times as well, prosecutions of individual of marijuana use individual marijuana use, so give any comments on that distinction and where we are with marijuana? >> on the medical marijuana issue, i mean, the president made it very clear, the department of justice's role in enforcing federal law. the understanding that limited federal enforcement resources would not be used against people who have been prescribed, or they can be -- can't be prescribed, recommended, marijuana. but as he said, i never get part launched to grow operations -- i never gave carte blanche to grow operations. i think perhaps early on people

thought that things would be a bit different. and, in fact, federal law is what federal law is. >> this is from a reno alexander from the cruel justice policy foundation. as a young drug policy activist, can you tell me what i can do to demand that -- [inaudible] >> i think the understanding around the needle exchange programs would be helpful. this goes back to that debate that i try to characterize almost exactly in the beginning, and there are people who say well, it is a needle exchange program, that means that more people will be inclined to use or continue to use. you know, i spent a lot of time in this business. i've never met someone who is addicted to drugs and said she, because there's a needle exchange program i'm more inclined to continue. not at all. on the other hand, needle exchange program can not only help to reduce the issue around

infectious disease. windows programs are in operation, they also provide an entrée of information about treatment programs. and perhaps when that person is better, it may be the right time in their life that they're getting the information about a treatment program. and i think that's what we would like to see. >> whitney from dod. in light of some passionate summit of the americas, what is your opinion of central and south america countries of drug decriminalization? what impact do you see these centers having a drug flow to the u.s. and consumption? >> i think we've seen a couple things as result of a lot of the discussion, both before and then during the summit of the americas, particularly before, by some central american leaders. i think president santos, who, in colombia, certainly understands this issue very, very well.

and he looked fo for a middle-of-the-road approach. he said that incarcerating number so people for drugs is probably not an answer, and looking at legalization. and so looking at these policies, and i believe the president and the vice president both have advocated for a strong review of the policies. but let's look at the successes. i don't think, i don't know anyone that doesn't give columbia-high road marks for the reductions in violence, for improvements in their economy and their security, for the reduction in coca, planting. and when i visited a group of people who were both farming fish and also growing sugar cane in the mack arena area of columbia, they said you know i might have a little more money in my pocket when i group cocoa companies that i was always afraid of criminals coming in,

taking my crop, terrorizing my family. and he said to have a steady income as a result of come and these are programs that are strongly sponsored and supported by usaid, and others, the result of a steady income, he said it's better for my family and it's better for the safety and security of my village. good changes. >> this is from steve fox, marijuana policy president. as you know, are most of them as an expert on substance abuse, both marijuana and alcohol are widely used by adults in the u.s. given that alcohol causes far more deaths and acts of violence for users, could you explain why you support policies that prevent adults from using marijuana instead of alcohol if that is what they prefer? >> i think the issue always gets a round the debate, well alcohol is more dangerous, or alcohol causes more deaths, or alcohol. so certainly nobody's going to roll the clock back and say, gee, we need to execute prohibition on alcohol.

but there are no good reasons to legalize marijuana. i often hear about tax, regulate, and control as an answer. and then i look at prescription drugs, which as i mentioned to take over thousand lives a year, that although the number of people that come into emergency departments, and the number of people that are treated. and prescription drugs are already taxed. they are already regulated. they are already controlled, and we do a very poor job of keeping them out of the hands of abusers, users, and young people. so i don't see that we would do a very good job with a substance that can easily be, can easily evade the tax scheme, because it doesn't take rocket science to grow marijuana. and i think, i would become

concerned, if i look back at california and it was sold out it will reduce violence, it will fix your economy, it will reduce or eliminate vast amount of criminal justice costs. and on and on. i kind of looked at that and said well, i'm glad the voters of california recognize that perhaps there wasn't as much truth in all of those claims for legalizing marijuana as has been put out in the press release. >> anthony wilson from the american health, researchers have realize addiction is a disease for years but why has it taken so long for the federal government to acknowledge this, particularly since the federal regulars have done the most work? >> i think we don't speak to the right audience, and i think that if you're a federal health researcher, or you're a researcher in academia, you speak to other academics. you speak to medical groups, and you don't speak to the american

public. if you would have asked me not that many years before getting this job about the disease of addiction, i would've said look, this is a moral and. people just need to find god, they need to pull themselves up by their bootstraps, et cetera. it only took a lot of reading and some understanding to realize that this is chronic diagnosable, but surely treatable disease that we should be looking at and handling from a much greater public health perspective. so i'm kind of the unexpected messenger. so i may police chief it doesn't talk that much about arrest and incarceration, but i may police chief it talks about education and public health. >> this falls on the a little bit. neil franklin, as a 33 law enforcement veteran has arrested hundreds people of non-violent

drug offenses, we currently arrest 1.6 million nonviolent drug offenders every day. what is your new annual arrest target and strategy for reaching its peak works i think what is income and having a law enforcement background, people don't quite understand that the vast majority of this enforcement and work gets done at the state and local level, not by the federal level, and not by the drug enforcement administration. the changes that i am seeing across the country in reductions for and incarceration, for low-level drug offenses, it is important. i think one of the other things that is kind of helpful, that as a police chief for those that would have talked about this a few years ago, you would've been characterized as either soft on drugs or soft on crime. it's pretty hard to characterize somebody with 37 -- wow, 37 years, with 37 years as being

soft on either of those things. and so a policy that begins to say there are other alternatives to incarceration, and there are ways to reduce some of this problem i think our particularly helpful and important. i think the national drug control strategy direct and events of the federal agencies operate. it doesn't do that for the state, and yet strategy that is science-based and has been well constructed, my opinion, can be a wonderful template for a state governor and state legislatures to say you could look at this differently from that level. >> and i think we, we afford to have time for just two or three more question. from jonathan blank from cato. does the shift towards prescription drug enforcement have greater controls on adderall/add drugs which recently suffered a nationwide shortage of? >> i'm not familiar with, i think i'm uncertain if it was the adderall issue, et cetera. but when i talk about the

prescription drug problem in particular, i'm talking about the opiate pain killers, the vast increase in prescriptions, the lack of information and education that is provided to doctors about pain management and addiction and tolerance. and i think that those important parts of looking at what's taking the most american lives, what's sending the most people do we have, are around those drugs versus adderall. >> please speak to a multi-sector-based prevention can decrease drug abuse. >> multi-sector committee-based drug prevention. i guess i shouldn't say this for the recording, but the vast majority of the work that gets done in this area, around this country, is the people who have the boots on the ground, our people inside the beltway.

it is clearly a group of people that i've had this gift for three years to go around the country and meet and listen to. and their voices, as directed by the president to me, their voices are part of the national drug control strategy. they are the ones meeting with you. they're the ones trying to raise money. they are the ones holding take sales, the once mentoring kids. they are the ones volunteering in schools, and we have this wonderful opportunity to give them evidence and science-based tools and information about what will help keep our next generation healthy. and as i approach retirement age, i want them to pay their social security taxes. i want him to be doing a great job out there. >> okay, this is the second to the last question. scott morgan. i appreciate your increase and treat them. do you support compulsory treatment for casual users?

directing marijuana users and enforcing the into treatment is an effective policy? >> you know, that's been a bit of a myth. so this issue around some of his arrest for a small amount of where one, and then they say okay, we made this determination that you're going to have to go into treatment, et cetera. i think, treatment beds and treatment space is a valuable commodity. and when you have experts, professionals in the treatment field, and the diagnosis field, you know, i think they can clearly assess whether somebody is, in fact, in need of treatment. so compulsory treatment, i'm not sure, you know, is an issue that i'm as familiar with in detail at the level. let me give you two examples. so we did a press conference not that long ago. with a wonderful, wonderful woman who contributed her change from drug use to one of

recovery, to one of speaking out about this issue, because she spent 30 days in the broward county jail, where very foresighted sheriff said i don't really care how long a happen to be in custody here, i'm going to rely them with much treatment and programs as possible. and we did the same thing when we looked at the methamphetamine problem in st. louis. we talked to a young man, and he said i got into treatment as i was on my way to visit my mother who was dying of cancer. and he said the officer stopped me, arrested me for methamphetamine, and he said, the way he treated me helped me on my path to treatment and help me on my path to recovery. and i could just, i mean, i could cite literally hundreds of stores across the country in which i don't want to see law enforcement characterize as anti-prevention, anti-treatment. people and treatment

professionals in particular should look at them as a valuable ally. and if i regret anything in my law enforcement career, it was an understanding and recognizing the disease of addiction, and what a strong ally law enforcement could be. and i hope to change that. >> that's great. this is the last question from lindsay house. what are you doing to assure drug use is prevented before it even starts? >> our key has been funding for drug free community support program with our partners at santa, the substance abuse and mental health services administration. and for a very small amount of money over a period of years, the small grassroots coalitions, they just make a huge difference in bringing together the school system, faith-based leaders, law enforcement, and other to help provide a program that, for an incredibly low-cost, gives young

people the kind of tools and information they need to be much more aware of the drug problem. and hopefully prevent it in i couldn't be more proud of those community-based programs where the real work is going. >> great, thank you. thank you for coming and thank you for your time today. >> thank you. [applause] >> the response you posted on we the people. you're completely ignoring the issue. [shouting] >> are you trying to ban it? you are ignoring the issue. why are you ignoring this issue? [inaudible conversations]

>> [inaudible conversations]

>> this week, live from london, the ceremony and pageantry of the state opening of parliament. until recently parliaments official opening was usually held towards the end of the year. with changes to their election rules, it's now been moved to the spring. and wednesday, queen elizabeth will formally outlined the government's priorities for the upcoming year. live coverage starts at 5:30 a.m. eastern on c-span2. >> taking a look at the u.s. capitol today. the senate is about the gavel and taking up the student loan interest rate increase, which would prevent rates from doubling in july. and after that, debate on three judicial nominations for judges in california, illinois and arkansas. centers will take up those nominations at 4:30 p.m. with votes at 5:30 p.m. eastern time. over on the other side of the capital the house will come in at 2:00 as well today working on

suspension bills including one that would open the southwest waterfront in washington, d.c. to development, and using that capital for upcoming public events. the presiding officer: the senate will come to order. the chaplain, dr. barry black, will lead the senate in prayer. the chaplain: let us pray. eternal spirit, the center of our hope, we know our needs.

life has taught us that we can't walk alone, so be with our lawmakers to help, to comfort, and to sustain them. lord, guide them through the changes and chances of their labors. whatever light may shine or shadows may fall, empower them to meet life with a steady gaze, to walk in strength, wisdom, purity, and joy. create in them a passion to do what is right, and give them the ability to do it. as they seek to live with honor, may their thoughts, words, and

actions bring glory to you. we pray in your sacred name. amen. the presiding officer: please join me in reciting the pledge of allegiance to the flag. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. the presiding officer: the clerk will read a communication to the senate. the clerk: washington, d.c, may 7, 2012. to the senate: under the provisions of rule 1, paragraph 3, of the standing rules of the senate, i hereby appoint the honorable richard blumenthal, a senator from the state of connecticut, to perform the duties of the chair. signed: daniel k. inouye, president pro tempore.

the presiding officer: the majority leader. mr. reid: thank you. we're now considering the motion to proceed to the stop students loan interest rate hike. at 4:30, the senate will proceed to executive session to consider three judicial nominations, the nguyen nomination, the baker and lee nominations which are two district court nominations from arkansas and illinois. at 5:30 there will be up to three roll call votes on confirmation of the nominations. mr. president, a woman from nevada by the name of amy reilly, a single mother from las vegas, was devastated when she was laid off three years ago because of her employer having little work. she wasn't in love with her job doing bookkeeping for a local construction company but she loved the steady paycheck. so looking back on the pink slip, amy views it as, of course, a setback in one sense

but really she feels very good about the fact that it gives her a second chance. like many resourceful americans who lost their jobs after the financial and housing markets collapsed, amy took the opportunity to return to school. she enrolled in classes at college of southern nevada and cleated he had associate's degree at the age 363. going back to school really transformed her life. she got involved in the political process and this was for the first time. she in the whole time in school made straight a's, a 4.00 grade-pointage of. but she's wracked up some student loan debt. amy doesn't regret the decision to go to the university. not only has she gotten a second chance at college, she has shown her 14-year-old son the power of education. still, working three part-time jobs and living on a few thousand dollars a year hasn't been easy and that's an

understatement. it would have been impossible for her to get her education that she's gotten so far without student loans. amy will need more loans to get her bachelor's degree where she starts classes this fall. for most students taking on debt is the only way to turn dreams of higher education into reali reality. theage of student graduates with $25,000 in debt. and on july 1, the interest rates on federal loans are set to double for more than 7 million students. unless congress acts quickly, rot is will jump from 3.4% to 6.8%. that will cost amy and millions of other students at least $1,000. for a single mom working three part-time jobs, $1,000 is the difference between completing your bachelor's degree and simply stopping school. in nevada, higher interest rates will affect 26,000 students.

college is already unaffordable for far too many americans and we can't afford to put higher education further out of reach. so senate democrats have introduced a proposal to freeze student loan interest rates at current lels for a year without adding a single pen economy to the deficit. democrats will vote on that proposal before noon. we hope the republicans will joins. mr. president, republicans claim they share democrats' goal of protecting these 7 million students i talked about from these interest rate increases. we'll see. they insist we should paid for this proposal with unreasonable cuts to preventive health services for millions of americans. this is a program that is so vitally important to the health care delivery system in this country. senators mikulski and senator marcharkin and others have workd had ard to maintain this prasm it is so essential. republicans know the proposal would never pass the senate -- never -- and president obama has said he would veto more cuts to

crucial preventive health care. but there's already a compromise that's on table. our legislation closes a loophole that allows the rich to avoid paying taxes. our proposal is not a new tax, mr. president. it would simply stop wealthy americans from dodging the taxes they're required to pay. if senate republicans are truly serious about protecting 7 million students, then work with us to pass this reasonable proposal. mr. president, i ask unanimous consent that the senate proceed to executive session to consider the following nominations: calendar number 51 2 and 513, the nominations be confirmed en blocked, the motion to reconsider be laid on the table, with intervening action or debate, no further motions be in order to any of the nations, any the president be immediately notified of the senate's action

and the senate resume legislative session. the presiding officer: is there objection? without objection, so ordered. mr. reid: would the chair anownts business of the day. the presiding officer: under the previous order, the leadership time is reserved. under the previous order, the senate will resume consideration of the motion to proceed to s. 2343, which the clerk will romplet. the clerk: motion to proceed to calendar number 365, s. 2343, a bill to amend the higher education act of 1965 to extend the preduced interest rate for federal direct stafford loans and for other purposes.

mr. harkin: mr. president? the presiding officer: the senator from iowa. mr. harkin: mr. president, parliamentary inquiry. we are now on the stop the student loan interest rate hike act of 2012. is that not correct? the presiding officer: we are on the motion to proceed t to tt measure. mr. harkin: i yield myself such time as i might consume then. the presiding officer: without objection. mr. harkin: i can't emphasize the importance of the legislation before us, the stop the student loan interest rate hike act of 2012, which the majority leader just spoke about.

on july 1, unless congress intervenes, the interest rate on federal student loan debt is set to double from 3.4% to 6 30eu%. -- to 6.%. more than million students including than estimated 255,000 students enrolled at iowa colleges and universities would be required to pay an average $1,000 more per year of school. the bill before us is straightforward, it is fully paid for, it chemica keeps the t rate at 3.4% and the cost is offset by closing a tax loophole that benefits certain high-income professional service providers. i'd like to thank senator reid for his leadership in advancing this critical legislation. i also thank president obama for miking this legislation -- ma for making this legislation an urgent priority and for visiting collegvisitingcampuses across t. in today's global

knowledge-based economy, an education beyond high school is a necessity. a worker with a bachelor's degree makes 85% on average than a high school graduate. almost two-thirds of the job vacancies between now and 2018 will require some postsecondary education and more than half of those will require at least a bachelor's degree. you can see by this chart, right now, as i said, 63% of the jobs will require at least some college education. either college and associate's degree or a bachelor's degree or more. that's just by 2018. and the demand is going to grow even beyond that. these statistics convey a very clear message: higher education is the key to not only entry into the middle class but a middle-class life. another message is equally clear, and that is america's

economic competitiveness and growth depend on a highly educated and highly skilled workforce. that's why the ever-growing mountain of student loan debt is a major concern for me as the chair of the "help" committee and also a major concern for families all across america who are struggling to get by. it's a shocking fact that total student loan debt now has surpassed total credit card debt for the first time ever. $867 billion right now in student loans. auto loans, $734 billion. credit cards, $704 billion. so for the first time ever, student loan debt -- they now owe more on that than they do on their car loans or on their credit cards. again, i want to bring this more closer to my own hoavment it --n

home. iowa borrowers have anag anage f ever $30,000 of college debt which is the third highest in the nation. over the past three years, president obama and congress have taken robust steps to improve college affordability and help our students succeed. from the recovery act and its unprecedenced support for our education systems to the student loan reforms that enable us to help more students through larger pell grants, and most recently efforts to make it easier for students to row pay their loans. this all happened in just the last few years. we have made major strides towards the president's goal. i hope it would be our shared goal of reclaiming america's standing by 2020 a as the county with the high et proportion of college graduates. needless to say, it will be much harder to reach this goal if congress allows interest rates

to double on july 1. as i said, more than 7.4 million american students would be required to pay an average of $1,000 over the lifetime of the loan for each year they borrowed. so again, if you look at this, this chart again shows what's happened. if the interest rate is paid at 3.4%, we're looking about $883 in interest over the life of the average loan. you double that interest, it goes to $1,876. that's 6.8%. so the average savings to the average student would be almost $1,000 a year. i might just add that the 255,404 borrowers in iowa will save an estimated $254 million

with this bill in front of us. with today's tough economy and given the very high unemployment rate among americans, it's unacceptable to ask middle-class families to shoulder sharply higher student loan interest payments. we must not allow this to happen. if you look closer at the characteristics of students who will be impacted by this interest rate hike, you see that it really, really affects middle-class families and vulnerable students from disadvantaged background at the very time when they're under enormous financial strain. if you look at who gets the subsidized loans from this chart, you can see that by family income, dependent students, their family income is less than $60,000 a year. less than $60,000. if you look at the independent student loan borrowers, their income is less than $50,000 a year. 89% of them is less than

$50,000. and those dependent student loan borrowers from families, 60% are from families that have less than $60,000. i might also add that seven out of ten of those independent students here, seven out of ten reported under $30,000 a year in income. under $30,000 a year in income. so allowing the interest rate to double would also disproportionately affect minority students, minority students who account for 40% of these borrowers. 40% of these borrowers are minority students. this bill, again, would prevent, would prevent the interest rate from doubling on july 1 for those borrowers. so with the bill before us, we're considering a pragmatic and fiscally responsible solution to this problem that will keep interest rates low for

more than 7.4 million students. the bill is fully paid for, and we offset the cost by raising revenues in a way that will provide a solution to a long-standing problem in the tax code that has been subject to widespread abuse. let me just define how this measure is paid for. for many years we have seen avoidance of properly owed social security and medicare taxes by some subchapter "s" stockholders who declared a portion of their income is effectively profit and, therefore, not subject to social security or medicare taxes. this is not supposed to be a choice that is made at the whim of the taxpayer. it should be based on objective facts. the offset in this legislation does just that. it creates a bright-line test for a small share of subchapter "s" shareholders, basically those engaged in professions

such as doctors, lawyers, accountants, consultants and lobbyists whose financial gains -- the financial gains they have come from the work that they do. it's narrowly tailored to cover only those subchapter "s" organizations in which there are three or fewer stockholders and only for those earning $250,000 on joint filings. with this bright-line test, the medicare and social security trust fund will receive the funds that are properly owed to them which they're not receiving today because they're counted not as an income but as profits. now my friends on the other side of the aisle have proposed a different offset to pay for keeping the interest rate at 3.4%. the bill that passed the house of representatives and the legislation proposed by senator

alexander of tennessee would offset the cost of this bill by eliminating the prevention and public health fund, which was created by the patient protection and affordable care act. in short, rather than put an end to an abuse of the tax code, my friends on the other side of the aisle are proposing that we eliminate the sole dedicated source of federal funding for investments, critical investments, in preventing disease, keeping women and children and elderly families healthy. they want to eliminate the prevention and public health fund. mr. president, many of my republican colleagues have acknowledged the critical importance of investing in prevention and wellness, which makes the use of this offset -- that is eliminating it -- all

the more troubling. preventing disease, expanding access to screenings, encouraging people to stop using tobacco, these used to be bipartisan goals strongly supported by a vast majority of republicans and democrats alike. so in the affordable care act, we created the prevention fund with the expressed goal of ramping up our investments in these prevention and wellness initiatives, again, with republican support. quotes from two republican leaders: senator kyl on 7/12/2010, in the midst of the debate on the affordable care act said -- quote -- "one of the things we did in the health care legislation was to provide a lot of different incentives for

preventive care for screening to try to help people avoid illnesses on the theory that it would be a lot cheaper if we didn't do a lot of treatment that was unnecessary." i couldn't agree more. the republican leader, senator mcconnell, said the same year, 2010: "congress should be able to work together on our practical ideas that the american people support, such as encouraging wellness and prevention programs that have proved to be effective in cutting costs and improving care." that was just two years ago. well, yeah, less than two years ago. but now -- but now republicans are making outrageous partisan attacks on the prevention fund. i find this deeply disturbing and disappointing. it's not hard to imagine the message gurus, those that hone

messages, telling republicans, here's all you got to do. just smear the prevention fund by calling it a slush fund. how many times have i heard that? the prevention fund is a slush fund. i've heard it in committee. i've heard it on the floor. i've seen it in print. republicans calling the prevention fund a slush fund. well, this is shameful. that term, slush fund, is a malicious untruth. nothing could be further from the truth. the truth is that the prevention fund has been a giant step forward for public health in our nation. typically prevention and public health initiatives are an afterthought. this means important community-based interventions often go unsupported. the prevention fund is making it possible for us to make national investments and evidence-based programs that promote physical activity, improve nutrition,

reduce tobacco use. well, these are the investments that we make. this prevention fund which the republicans want to eliminate, invest $226 million to reduce chronic diseases including diabetes and heart disease. that minimizes the $440 billion a year in health care costs from heart disease alone. it invests $93 million for antitobacco education and support campaigns. to minimize the fact that over six million kids will die from smoking if the current rates persist. it investments $190 million for childhood immunization programs. again, to minimize the $3 billion a year in unnecessary health care costs right now. i might just add, mr. president, the lead editorial in today's

"new york times" said no longer just adult onset. that's the head of it. "a type 2 diabetes in children is yet another reason to fight childhood obesity." i won't read it all but i think there's a few pertinent paragraphs here in the "times" editorial today. it starts off by saying "a study of diabetes in overweight and obese youngsters bears an ominous warning about future health care trends in this country. it found that type 2 diabetes, a new scourge among young people, progresses faster and is harder to treat in youngsters than in adults. the toll on their health as they grow older could be devastating. this new study was published in the "new england journal of medicine." some experts suggest -- reading further -- that young patients

with diabetes need to be treated more aggressively. but the long-term goal should be the prevention of obesity and diabetes. congressional republicans -- "the editorial goes on -- "are bent on dismantling health care reforms that could greatly assist in curbing the obesity epidemic. the republican-dominated house last month narrowly passed a bill that would eliminate a prevention in public health fund established under the reform law, in part, to pay for lowering the interest rate on subsidized student loans for this year. the fund is already providing grants to state and local governments to help pay for programs to fight obesity and prevent chronic diseases, including diabetes in the community, the workplace and among minority groups that have high rates of obesity and diabetes. killing off this program -- the

editorial goes on -- would be hugely costly to americans' health and future health care costs. there is no explanation of this move except for the usual anti-health care reform demagoguery." mr. president, i ask consent this editorial appear in its fullness at this point in the record. the presiding officer: without objection. mr. harkin: well, mr. president, i know if i can make it any more clearer than the "new york times" editorial but i want to mention several representative investments that are happening, again, right now. i mentioned those right here. the $226 million on diabetes and heart disease, $93 million for anti-tobacco education, $190 million for childhood immunization programs.

i might just go back to that first one, the heart disease, because heart disease disproportionately affects women. most people don't know that. i think most people would say the number-one cause of death in women today might be breast cancer. not so. the number-one cause of death for women in this country is heart disease. some 42 million women are currently living with some form of heart disease in america. and the world health organization estimates that a staggering 80% of heart disease, diabetes and stroke could be prevented just from changes in smoking, nutrition and physical activity alone. 80%. that's what this prevention fund is doing right now. and moreover, this investment by the prevention fund isn't only saving lives, it's saving money. right now, as i said, heart disease costs our nation about $440 billion a year. we can reduce those costs.

we can reduce those costs. i might mention also smoking. cigarette smoking also kills an estimated 173,000 women every year. the current smoking rates persist, more than six million kids will die from smoking. now the new national anti-tobacco ad campaign is called -- quote -- "tips from a former smoker" is being supported by this prevention fund. i think many of us probably have seen these ads. they're extremely powerful and effective ads, and they're going to save lives. in fact, this ad campaign is expected to inspire half a million quit attempts and help at least 50,000 americans quit smoking forever. i might just add that within two days -- within two days of these ads first appearing, the number of phone calls to smoking quit

lines tripled. tripled from people who wanted help in quitting smoking. i mentioned the immunization programs for kids. these investments from the prevention fund aren't just at the national level. th*erls in our communities -- they are also in our communities. this fund is helping states, cities and towns to implement programs that meet their particular local needs. for example, in illinois, the state has made improvements to its sidewalks and its marked crossings to increase levels of student physical activity. because of these improvements, the number of students who are walking to school has doubled, doubled. that's a good thing. so not only is this good for their health, it's expected to save the school system about $67,000 yearly on bus costs. in mobile, alabama, mobile county officials enacted a

comprehensive smoke-free policy, expected to protect 13,000 residents and visitors from being exposed to secondhand smoke. this is mobile, alabama. so all across america, the prevention fund is investing in proven locally developed programs, locally developed programs that promote health and wellness. these evidence-based programs not only improve health but as i said will help us save money and health care costs. according to a new study by the the -- by the centers for disease control and prevention, programs like the national diabetes prevention program could prevent or delay nearly 885,000 cases of type two diabetes, saving our health system about $5.7 billion over the next 25 years. the national diabetes prevention

program is a public-private partnership of health organizations working together to prevent the type two diabetes that the "new york times" editorial was just talking about. and given that in 2007, diabetes alone accounted for about $116 billion, $116 billion in direct medical costs, it's critical that we continue these investments. now, again, here is how this investment is being returned. you might say the return on investment for public health spending. for every dollar spent on childhood immunizations, we save 16.50. proven. for chronic disease prevention, for every dollar we save $5.60. for workplace wellness programs, $3.27. if you want to look at it in terms of dollars and juju in

terms of saving lives, we're saving money also. mr. president, the prevention fund's investment in cancer prevention also provide an opportunity to save lives and money. in 2007, the direct and indirect costs of cancer which accounts for nearly one out of every four deaths in the united states totaled about $123 billion. earlier this year, researchers found nearly half of u.s. cancer deaths could be prevented, again, through the kinds of programs the prevention fund is funding today. preventable u.s. cancer deaths about 50%. preventable diseases from heart disease, diabetes and stroke about 80%. this is what the prevention fund is going after. for the life of me, i have never understood those who want to get rid of the prevention fund and yet are willing to pump untold billions, trillions of dollars

into patching, fixing, mending, surgery health care costs down the line. perhaps my friends on the other side of the aisle have never learned that old axiom of ben franklin's about an ounce of prevention is worth a pound of cure. here about an ounce of prevention is worth about ten pounds of pure or more. well, the list goes on. recently, the trust for america's health released a study showing that a 5% reduction in the obesity rate could yield more than $600 billion in savings on health care costs over a 20-year period of time. 5% reduction. studies such as this one confirm what common sense tells us, that prevention is the best medicine for our bodies and for our budgets. that's why nearly 800 organizations have spoken out against these misguided efforts to slash or eliminate the

prevention fund. mr. president, these organizations like the young invincibles, the u.s. student association, the american diabetes association, the campaign for tobacco-free kids have all said no, don't, don't cut, don't eliminate the prevention fund. despite misguided efforts to cut or eliminate the prevention public health fund, most americans understand what's at stake. prior to the prevention fund, for every dollar spent on health care, 75 cents went to treating people with chronic illnesses and only about four cents went to prevention. 75 cents taking care of people later on with chronic diseases that are preventable, only four cents out of every dollar went to prevention. this underinvestment has had

devastating consequences. nearly half of american adults have at least one chronic condition. yes, you heard me right. nearly half of american adults have at least one chronic condition, and two-thirds of the increase in health care spending between 1987 and 2000 was due to the increased prevalence of chronic diseases. so if two-thirds of your budget, of the increase in spending is on chronic diseases and yet we can reduce those chronic diseases through prevention, you would think that you would want to increase that four cents a little bit on the dollar that we're spending right now. this prevention fund gives us an unprecedented opportunity to bend the cost curve. how many times have i heard about benning the cost curve -- bending the cost curve in medicine? the best way to do it is to

prevent chronic diseases. the transformation of america into a true wellness society, a society that focuses on preventing disease, saving lives and money is the most cost-effective way to proceed. so as we can see, the slander of the prevention fund as a so-called slush fund is a shameful mischaracterization. this fund is saving lives and saving money. eliminating this fund as proposed by my friend from tennessee would be bad public policy, a serious case of misplaced priorities. the very idea that republicans would slash prevention in public health so that a small group of high income taxpayers can continue to abuse the tax code i find simply unacceptable. now, before i close my remarks, i'd like to address an egregious

mischaracterization that i have heard from the other side of the aisle. some republicans claim that democrats in our historic reform of the student loan program took money that had been going to students and used it to pay for the health care bill. i've heard that a lot of times. well, again, that's simply not so. the reforms passed by democrats in congress, i might add over vehement republican opposition, did not take a single dime from students. instead, the bill eliminated wasteful taxpayer-funded subsidies to banks by converting all new federal student loans to more stable, reliable, cost-efficient direct loan programs. redirected that money to students, to deficit reduction and some important health

reforms. the money didn't come from students. the money came from the subsidization that we have been giving to banks. specifically, thanks to the huge savings generated by eliminating wasteful subsidies to banks, what were we able to do with that? we provided increases with the maximum pell grant award to keep up with inflation. we provided funding for minority-serving colleges and universities. we made a major investment in community colleges, creating a community college and career training grant program. we were able to make loan repayment more manageable by capping a new borrowers loan payment at 10% of -- new borrower's loan payment at 10% of their income. and forgiving any remaining debt after 20 years of payment. that was all done by stopping this wasteful subsidies to banks and putting it into the direct loan program. and again, we provided more than

$10 billion in deficit reduction. now, at the same time, we were able to expand the community health center program to ensure access to life-saving medications and to expand vital consumer protections to millions of americans with private health insurance. protections that we put in like banning lifetime limits, requiring dependent coverage, prohibiting cancellation of coverage due to an illness. in other words, thanks to the education reform bill, students benefited, the middle class benefited, taxpayers benefited and health care consumers benefited. had my friends on the republican side had their way and had those reforms been defeated, only the banks would have benefited. now, indeed, kind of detect a pattern here. when we democrats were fighting to end this subsidy to banks so that we could dramatically

increase college grants and loans from middle class and disadvantaged students, my friends on the other side of the aisle stood at the banks and did everything they could to kill the reforms. likewise today, democrats are fighting to prevent a 100% student loan rate hike. we want to fully pay for it by correcting a provision in the tax code that allows a small, a small group of wealthy americans to avoid paying some social security and medicare taxes. republicans are going to the mat to prevent those wealthy taxpayers from having to pay their fair share. instead, how do they want to pay for keeping the interest rate down? by gutting the prevention fund, killing it, eliminating it, the very fund that's investing in initiatives to fight cancer and heart disease and to protect the health of our children, our women and our elderly. well, what they are proposing is

bad public policies, bad priorities. we need to be putting the middle class first. we need to be putting students struggling to pay for college first. we need to be putting public health and prevention first, put all of those out there. to make these things possible, we should ask this small group of wealthy americans to put their country first and stop abusing this provision, this loophole in the tax code. so i urge my colleagues to support the stop the student loan interest rate hike act and to support the offset currently in the bill. five years ago, the original law that reduced the student loan interest rate to 3.4% passed with overwhelming bipartisan support and signed by a republican president. i hope that we can find common ground to pass this new legislation with that same kind of broad and bipartisan support. with that, mr. president, i

yield the floor. the presiding officer: the senator from tennessee. mr. alexander: mr. president, i am glad i had an opportunity to hear the distinguished senator from iowa who is my friend, the chairman of the health, education and labor committee. i -- i want to address the same subject he did, but i want to hasten to summarize at the beginning to say we agree -- by we, i mean governor romney, the likely republican nominee for president, president obama, house republicans, i, others, agree that for the next year, we should keep the interest rate on 40% of the student loans at 3.4% for new loans. we agree on that. there is not a difference of opinion on that. what's different, what's different is how we pay for it and what -- and what the distinguished senator from iowa has done is actually outlined very well the difference of opinion here. what we're saying, what the republicans are saying is that

in order to pay that $6 billion it costs taxpayers to keep that 3.4% rate the same for the next year, we want to give to students, we want to give them back their own money, the money that the democrats are overcharging them on their student loans. now, the senator from iowa went through a very careful explanation on that which was largely correct. he pointed out that at the time that the majority decided it would put the secretary -- make the secretary of education the nation's leading banker, put him in charge of administering what's becoming to be nearly a trillion dollars worth of student loans every year, in other words, take it away from banks and make the government the banker, that there was about $61 billion in -- quote -- savings. that's from the congressional budget office. the argument of our friends on the other side was those were unnecessary subsidies to banks.

well, let's say, mr. president, for the moment, for the sake of argument that they're correct about that. that $61 billion is money that students were paying in interest on their student loans. so wouldn't the logical thing to do be to let the students keep the money? i mean, if you really cared about college tuition going up, student loans rising, wouldn't the thing to do be to say we have done a big favor to you students, the government has been overcharging you on your student loans, all 15 million, 16 million, 17 million of you who have student loans, so instead of the rate of 6.8%, which it is for most students, we're going to lower that rate to 5.3%. that's not my number. that's the number the congressional budget office said that we could take that $61 billion that our friends on the other side said the government's

overcharging students, and we could reduce the average loan of about $25,000 to a 5.33% rate instead of 6.8% and that would save the average student on the average loan about $2,200 over ten years but no, they didn't do that. they spent it on more government, $10 billion to reduce the debt and $8.3 billion to pay for the health care bill. what we're saying is in order to freeze this rate at 3.4%, let's give to students the money that they were paying instead of paying for the health care bill, let's reduce the student rates with that. that's the difference of opinion here. of course our friends on the other side have have better way in their opinion. not only do they want students to continue to pay for other government programs and some money for the health care bill, they'd like to raise money in the middle of the longest recession we've had since the great depression on job

creators. but let's -- let me go back to the beginning point here. we're talking about something that was reflected very well in "the new york times" yesterday, i notice the senator from iowa talked about "the new york times." here's the national section yesterday. talking about what's going on in california. angry about tuition increases, and cuts in courses and enrollment, a dozen students at california state university have taken their protests beyond marchs, they've declared a hunger strike. the fasting protest was the latest display of anger at the 23 california state university campuses. the system has lost roughly $970 million in state financial since 2008. mr. president, the university of california is probably the best public university in the world, it's lost nearly a billion dollars in state funding since 2008. and the students are fasting.

they're upset about the tuition increases. why are the tuition increases coming? well, the administrators say if we lose a billion dollars from the state for our state universities, the money has to come somewhere, to pay for complents complens in our universities so we increase tuition. that story has been going on all over the country. why is that happening? i mean the president has put this issue on the table. i think we need to discuss it. why are they fasting in california? protesting tuition increases. why in tennessee last year did state funding for the university of tennessee and community colleges in tennessee tech go down 16%? mr. president, the main reason is the federal government's health care policies, its medicaid mandates on states that are soaking up dollars, state dollars on medicaid that would otherwise go to pay for public universities. president obama did not start this policy.

it's been going on for 30 years, but he's making it much worse. with his health care law that was passed and when it takes effect next year, the kaiser family foundation says that states which already are spending one out of four of their state tax revenues on medicaid will see a 29% increase in the cost of medicaid funding and what will that do, mr. president? what that will do is force california and tennessee and connecticut and iowa to look in their state budgets, to take the money that most likely would have gone for the colleges and community colleges and public universities, and instead spend it on medicaid. those federal medicaid mandates are soaking up money that would otherwise go to public colleges and universities and as a result of that the universities are raising tuition, as a result of that loans are up, students are fasting, and the president's on

the campaign trail promising to fix it. let's talk about his fix. first, it is the political season, and so students as well as senators and all of us need to listen very carefully when someone begins to stir the crowd about a popular issue and surely being able to pay for college is a popular issue. we hope that all american students who want to go to a higher education will be able to go, will be able to afford to go. and our federal government goes to great efforts to make that possible. half of the students who go to colleges and universities in america, and there are 6,000 of them of one kind or another, have a federal grant or loan to help pay for college. we have more than $100 billion in new loans going out this year. that's from the american taxpayer. that's from people who are out there working and paying taxes, the -- the u.s.w. -- u.a.w.

moab, the teach perks they're paying $100 billion to students this year. the amount of money for pell grants this year is $41 billion more in grants. at the university of tennessee in knoxville, a fine campus where the tuition is about $7,200 a year, which is still a good bargain, by say at a great university, almost all the students show up with a $4,000 state scholarship called the hope scholarship, but for the quarter of those students who are low-income, they have pell grants that carry them above the amount of tuition the. so state and local governments have made a great effort to try to make it easier for our young people and older people to continue education and we want to continue to do that. there's a bipartisan effort on that. now, the specific issue at flayplay here, the one we're likely to vote on tomorrow, has to do with one type of those student loans. and let's -- let's try to put

that into perspective. if either version, the democrats have a version and republicans have a version, i'm offering a version which would pay for it by giving back the students the money that the government's overcharging them. the democrats have one that would raise taxes on people who create jobs, but whichever one were to pass, if one were, here's what it would do. it would save students on new loans about $7 a month on interest payments over the next ten years. that an add up. $80 a year or $800 in ten years. $7 a month in interest payments on the average loan, and that's for 40% of the loans. and that's for new loans. so if you've got a student loan and it's a 3.4%, that's not going to change. 40% of people do have student loans today at about 3.4%, everybody else is at 6.8% which

is a good deal lower than you could get a private loan, one where you go into a bank and say i'd like to borrow sown some money, maybe you can he you can get it but they'll charge you more because be you might not be able to pay it back as well as somebody else. we've agreed on in, at least on the policy. the president has agreed on it, governor romney has dpread on it. for thers in year like to keep the 40% loans at the 3.4% late and later in the year or earlier next year when we look at our budget, the size of the debt, which is of great concern to all of us on both sides of the aisle, we'll see what we can afford to do. that's the first question. but i'm glad the president has been going to college campuses. i'm glad he's raised the issue of student loans and college tuition. because as a former governor of tennessee who cares deeply about

education, as someone who was also united states education secretary about 20 years ago, i've been trying for 20 or 25 years to get washington to pay attention to the idea that it is ruining our public colleges and universities with these medicaid mandates that soak up the dollars that ought to go for public colleges and universities. three-quarters of our students go to public universities, like the university of tennessee or iowa state or california or the communities colleges which are really our secret weapon. and even with the rising tuition, those costs are -- are at least reasonable now. tuition at community college in tennessee is about $3,000. nationally, the average tuition to four-year public universities is about $8,200. it's not easy to find the money for that. but -- but it's still within range. but what has happened in the last 25 years? i can tell you what's happened in my state. i visited with the retiring

president of tennessee tech university, a fine engineering school. he said two things. one is over the last three years state funding for his university and for most in tennessee has gone down by 30%. now, that's not a 30% reduction in the rate of growth. that's a flat-out cut. a flat-out cut. and why has that been happening? our governor, the current one, and four former one, a democrat, both have said what i know and every governor knows, when you make up your state budget, and you get down toward tend of it you make a choice between medicaid and higher education and because medicaid is run from washington with specific mandates, the states end up being having a strangle hold on them. in effect if they participate in the program to be forced to make decisions about jibilityd and -- eligibility and how much they spend and there goes the

money. and there it doesn't go to the public colleges and universities, and less money, higher tuition, higher loans. now, the fasting students in california, if i walked up to them today and said i bet you didn't go noe that president obama's health care policies are the reason you're hung write -- hungry today, they wouldn't believe that. but the fact of the matter is not just the president's spoms but the policies over the last number of years have gradually soaked up money that wildcard ma the university of california a great university and left it no resource but -- recourse but to come more efficient which it should and raise tuition which it is doing. let me give you an example of how much difference this makes. in the early 1980's, i was a young governor and making these budgets up and by say, well, about this much mows ghost to k-12 education and the courts are running the prison so i'll have to put that in and the gas tax goes to the highways and

toward tend of the budget you make this choice between medicaid, the federal program that states pay about 30%, 37% of, something like that, and i was trying to restrict funding for medicaid and increase funding for -- for education. i could see where we were headed over the next several years. i went to see president reagan. i saw him in toafl office. -- the oval office. i said let me propose a grand swap. what do you mean a dwrand swap? we'll swap you -- we'll take all of k-12 education, we in the states, you take all of medicaid. he thought and said that sounds sowndz like a pretty good idea. my preeng reasoning was -- my reasoning was instead of medicaid having two masters, one in washington and all the governors, if it had one, it would be managed better. if washington ran it, washington would have to pay for it all, it would make sure it could fund it.

and i thought then and i think today almost all the comont for kindergarten through the 12th grade belongs closest to the child as possible, first the family, then the classroom, then the state and i believe that while there's been some important advocacy in washington over the last 30 years that if we'd made that grand swap, the medicaid program would be run better today and our public schools would be better today. we could argue about that but thing one thing we couldn't argue about is the difference in money. if we made the swap, the states would have come ahead by about $4 billion. in other words, the federal government would have taken over medicaid, the states would have taken over k-12, given back to the federal government the federal aid to education and the federal government would not spend its medicaid money. $4 billion was the difference in 1981 or 1982. what would the difference be today if we made such a grand swap? $92 billion, mr. president.

$92 billion of extra money the states would have if today the federal government took over all of medicaid and the states took over all of the responsibility in funding for k-12. that would mean in state like california where the students are fasting, california probably would have $12 billion or $13 billion more and do you think much of that would go to the university of california to continue its excellence? you can be sure it would. would much go to tennessee tech and the university of tennessee and the community college? you can absolutely sure it would. what has happened over the years is these well-intentioned federal health care medicaid mandates have put the strangle hold on governors which is why i said when we were debating the hack health care law i thought any senator who voted for it awrt to be sentenced to serve as governor for eight years and try to implement it. i mentioned in tennessee last year that state funding for higher education went down 15%.

well, guess what -- state funding for medicaid went up 16%. so there's a direct relationship. medicaid up, state funding for public universities down, tuition and loans go up and that's the real problem we have today. so i'm glad the president has put this issue on the table. i'm glad he's talking about it. and i hope governor romney talks about it. and i hope what they agree to do is either to repeal the health care law or to repeal the medicaid mandates and give states more flexibility. you can't pass a law in washington, as we did three or four years ago with the stimulus act, and say we're going to give you more medicaid money but, mr. governor and ms. legislator, you can't reduce state funding on medicaid. lieutenant governor ravage of new york, a democrat, wrote an excellent article in the "wall street journal" at the time and said, if you tell new york that at a time when we're reducing

revenues, and you say you've got to keep spending on medicaid, we have to cut something else, the state university of new york gets cut. so new york cuts the state university of new york, tuitions go up, loans go up, students are protesting. and it's not just the student protests i worry about. we're at a time in our history when we're in serious competition around the world in a brainpower competition. we have a lot of chinese scholars going from american university home again to their universities. we did, in a bipartisan way, the senator from iowa was a part of it and i was, we passed something called the america competes act a few years ago and we authorized it so we could properly fund our science and -- and our innovation. government-sponsored research has been an important part of our job growth over the last 30 or 40 years. and where is that done? it's done at our national laboratories or at our great research universities.

at least half of our great research universities are public universities. they're like the university of california, the university of michigan, the university of tennessee, university of connecticut. and if we cut, cut, cut, cut that government-sponsored research and the quality of those universities, our job growth won't be nearly as good in future. here's another example of how much that has changed over the years. 30 years ago in tennessee, the state paid 70% of the costs of of -- of a student to attend a state university and the student paid 30%. and we had an implicit agreement between the government and the student and we said, if we increase your tuition, we'll increase by the same percent the state contribution. so we kept it at about 70% and 30% and it made it possible for a lot of students to go to college. what is it today? it's 30% and 70%. it's upside-down.

30% of the support for public colleges and universities comes from the state government and 70% comes from the students. and why is that? the fact is, mr. president, the main reason is federal hg -- federal health care mandates that put an unrealistic amount of money on top of states and it's about to get worse. i mentioned earlier the kaiser family foundation says -- estimates that next year states that are already spending $1 out of every $4 for medicaid will see a 29% increase in medicaid funding. this fast will have to go on a lot longer in california if that's going to happen. you can't cut a billion dollars out of the university of california every three years and have it remain the best public university in the world. it's just not going to happen. and you can't raise tuition 6% or 8% every year and make college available to -- to the

large number of students that we would like to go. so i am glad that the president and our friends on the other side in this political year have -- have raised the issue of rising tuition and student loans we agree on the little issue before us. we'd both like to take that 3.4% interest rate, extend it for a year. that costs $6 billion. that affects new loans. it affects only 40% of the students but we agree on that. the president does, governor romney does. that's not an issue. the issue is, do we raise money on job producers or do we give back students some of the money we're continuing to overcharge them to student loans? that's the issue. but the larger question and one which i hope that we all address this year in our debates and that the president and governor romney address in their debates is what about the future of our public colleges and universities, where three out of

four american college students go? how are we going to maintain their quality and maintain the opportunity for access to them if we continue to impose on states medicaid mandates that soak up the money that ought to be going for excellence in higher education and the greatest amount of opportunity for students by keeping tuition rates low? that's the real issue. and while president obama is not responsible for what went on before he became president, he has made that condition much worse. and if he's going to bring this up on the campaign trail, i hope he tells the rest of the story, which is that he himself and his health care and medicaid mandate policies are a principal part of the reason and i would say the main cause going back over the years to the reasons why california students are fasting, tennessee students are looking forward to an 8% increase in tuition, and all across the country college presidents know

very well that the reason there have been such reductions is because of federal medicaid mandates. i hope, mr. president, we have an opportunity not only tomorrow to vote on the democratic proposal to keep -- to keep student loan rates at 3.4% but also on the republican interest rate reduction amendment that i have proposed, which would keep the rates at 3.4% but pay for it by stopping the overcharging of students to help pay for the health care law. mr. president, i thank the president and i yield the floor. mr. kyl: mr. president? the presiding officer: the senator from arizona. mr. kyl: mr. president, first let me say i very much appreciate the comments of the senator from tennessee and his leadership on this issue. and i join him in hoping that we'll be able to vote for the alternative that he's provided, which is a more sensible way to ensure that this increase in student loan interest fees does not continue. you know, many students who entered college maybe four or five years ago believing that

higher education would improve their prospects for getting a good job are now, sadly, very disappointed. the obama economy is going to let them down. according to a recent associated press story, one out of two recent graduates are either unemployed or underemployed. the article cites a new analysis based on government data which found that young college graduates -- i'm quoting now -- "are heavily represented in jobs that require a high school diploma or less that's con founding their hopes a degree would pay off despite higher tuition and mounting student loans." at this time, most of us agree that college -- that congress should extend the lower interest rate on certain stafford loans. unless we do, interest rates will double to 2.6% -- excuse me, double to 6.8% this july. and there are competing proposals to accomplish this extension, as senator alexander

pointed out. unfortunately, the majority leader's proposal is going to make this underlying jobs problem worse by burdening job-creating businesses with new taxes and compliance costs. now, let me illustrate how this occurs. in order to pay for the $6 billion cost of extending the 3.4% interest rates for one year , the reid bill attempts to do what nearly every bill proposed by senate democrats this session has done, it permanently raises taxes on job creators in order to pay for temporary spending. and, worse, the majority's attempting to divert dollars that are supposed to go to medicare or social security in order to fund complete -- in order to fund completely unrelated spending. in this case, the legislation singles out certain professional service businesses for a punitive tax hike, including those in the fields of health, engineering, arc sect tour --

architecture, accounting, actuarial science, performing arts, and athletics. ironically, these are some of the fields where there's actually demand for new employees, according to the a.p. story that i referenced earlier. the tax hike would hit business owners who perform services for their businesses and make $200,000 or, if they're married, $250,000. if the i.r.s. determines that 75% or more of the business's gross income is, what this bill describes, is attributable to the services of three or fewer owners, then this bill would make the owners pay payroll taxes on 100% of their share of the business profits, even if some of that profit had nothing to do with the owner's work. in addition, if a family -- if family members also owned a piece of the business, then the working owner will owe additional payroll taxes on the family member's share of the

business, even if that family member pays -- or provides no services. obviously there are several problems with this approach. let's start with the most obvious. it takes more money from the private sector and gives it to the government at the very time when we want the private sector to have enough to create new jobs. second, it rewrites the laws of income from labor and income from capital investment and this should not be done lightly, especially since confiscating more from small businesses means more -- means that they will be less able to expand and create more jobs. underscoring that this proposal is a tax increase and not a mere compliance measure, a coalition of 37 thoorgses represent -- coalitions of 37 businesses that represent small businesses that say it would "increase taxes on owners who are already fully complying with the law. for most businesses, this represents a tax increase rather than a clarification of existing tax burdens."

mr. president, i ask unanimous consent that the text of this letter be printed in the record at the conclusion of my remarks. the presiding officer: without objection. mr. kyl: thank you. so a bill that's intended to help students would actually make their job prospects even bleaker when they graduate. as the american institute of architects said of the reid proposal -- quote -- "if we're trying to make it easier for college graduates to get started in their career and become contributing members of society, increasing taxes on those who would most likely hire them is simply bad public policy." and payroll taxes are already scheduled to become more punitive for the small business owners targeted by this bill. under obama-care, the medicare portion of their payroll tax will rise from 2.9% to 3.8% and another 3.8% will be assessed on their investment income. to add insult to injury, this bill exposes family-owned

businesses to double taxation. for example, in a business with three family member shareholders in which only two provide substantial services, those two family members would be responsible for payroll taxes on their own incomes and then both of them would have to pay payroll taxes on the income of their third family member. applying this rising payroll tax to even more small business income is a terrible recipe in time of a weak economy. although a time when businesses are struggling to hire, the last thing congress should do is to make a bad situation worse. now, the other side will argue that their bill is intended to prevented cases of tax abuse so let's look into that. according to the i.r.s., 4 1/2 4 1/2 million "s" corporation tax returns were filed in 2009. data from the treasury department shows that "s" corporations account for nearly

40% of small businesses with employees. as these numbers show, doing business as an "a" corporation is popular. because it allows the double taxation of income that comes as organizing as a c corporation. the business income of these and other so-called flowthrow organizations is taxed as individual income by the i.r.s. given the prevalence of flow-through buys in our economy, there's not -- businesses in our economy, there's no surprise there's been some abuse of some who pay themselves small salaries in order to avoid paying medicaid and payroll taxes owed on their compensation. i.r.s. is well aware of this potential and i.r.s. is going after officials who do not pay appropriate payroll taxes through what the i.r.s. called the reasonable compensation test. this test has been used for over 50 years and the i.r.s. has won a number of -- a number of

taxpayers who have paid themselves is something less than is reasonable. the reid bill would impose a different standard, one that is arguably more confusing and lessen forceable than the current -- less enforceable than the current i.r.s. reasonable compensation test. under the reid bill, small businesses and the i.r.s. will be asked to determine whether 75% of the small business income is -- quote -- "attributable to the services of three or fewer shareholders." now, how on earth is i.r.s. going to determine which income is attributable to the work of a particular shareholders -- shareholder and not to other employees or to capital investments. for example, if a business, let's say, has three physical therapists, how will the i.r.s. know whether the business's income is substantially due to their services or whether at

least part of it real to the pact that they hired talented front office staff, did marketing, bought a building in good location, have a comfortable waiting room, implemented an efficient billing system and invested in state-of-the-art art medical equipment. and let's say that an i.r.s. agent manages to determine that exactly 75% of the business income is attributable to the services of the three physical therapists. that means 25% of the business income was not due to their services. but the bill would impose payroll taxes on that portion asly -- as well. this bill would impose taxes on business income that is due to capital investment which should not be subject to the payroll tax and to the work of other employees who have already paid their payroll taxes. payroll taxes should only apply to labor income, and they should only be applied once.

that's current i.r.s. policy, and it's good policy. as one commentator noted last week, the reid proposal will be a jobs program for tax lawyers, defending clients before the i.r.s. to determine what percentage of business income is attributable to services performed by certain share holders of an "s" corporation will be a boon for lawyers and c.p. e.a.sa.'s but r the services that wish to expand and hire. those of us who were here in 2010 argued against obamacare, among other reasons, because it relied on student to paid for part of its costs. a more prods way to extend the interest rate on student loans is to cut at least $6 billion in obamacare spending. which is exactly what the house of representatives recently voted to do. the house bill would cut spending from an unaccountable obamacare slush fund, formerly

known as the prevention and public health fund. this approach, which our colleague senator alexander spoke to 00 moment ago and of which i am a cosponsor, fully offsets the cost of a one-year extension of the subsidized interest rate and directs an additional $6 billion toward debt reduction. this ensures that job-creating capital will not be diverted from small businesses to fund a temporary, unrelated spending program. notably, president obama's own budget request recommended cutting this very same obamacare slush fund, and he's already signed into law legislation to cut $5 billion from it. finally, mr. president, i want to express my dismay at the lack of urgency from the majority about the most pressing issue facing small businesses and these college graduates seeking work and that's the automatic tax increase for all americans on january 1 of next year, the largest tax increase in the history of our country.

the legislation on the floor today will not become law, the majority knows that. it's another political show vote. we know this because this chamber rejected a similar hike two years ago when the majority had 59 senate seats and we know the house of representatives would not pass the legislation. as the senior senator from utah noted last month, "senate democrats are fiddling while rome burns." that's because in just eight months, as i said, the largest tax increase in american history will take effect on individuals, families, and businesses. taxes on income, capital gains, dividends, family-owned farms, estates will skyrocket. as previously messa messages med -- as previously mentioned, taxes on obamacare will also take effect. small businesses are facing a marginal tax increase to nearly

41%, a regular payroll tax rising to 16.2%, an aadditional $3.8% tax on investment income. we want these people to hire more, to create more jobs? instead of wasting valuable time on a bill that will never become larks i hope my colleagues will end their obsession with class warfare and start focusing on the most pressing issue at hand: stopping the policies that will do further damage to our already weak economy. defeating the majority leader's laiformajority leader'slatest te a good place to start.

mr. enzi: mr. president? the presiding officer: the senator from wyoming. mr. enzi: there's no reason we're having this debate today. freezing student loan interest rates for one year during tough economic times is something i believe we all agree on. so it should be relatively simple to accomplish. the president supports it, governor romney supports it, a bipartisan majority in both the house and senate support it. giften this kind of agreement, i see no reason why both sides could not have a good-faith discussion on where to find $6 billion in savings in a government with a budget that spends nearly $2 trillion annually. actually, we spend more than $2 trillion annually. i would mention that this bill has not been to committee. i hope that the american people have noticed that bills that go to committee and then come to the floor are usually successful. i hope they've also noticed that bills thew don't gbills that doe

and then come to the floor are not successful. it is what we have here today. you bring a bill that you know the other side -- well, in fact this other body has already voted on this concept of this tax before and defeated it. but they know that we're particularly upset about this kind of discrimination against the businesses that are starting the jobs in america. so they know that with that provision in there, this common interest will fail. so why do they do it? well, you notice that this is a 0 motion tmotion to proceed anda cloture vote, so 40 of us can stop that bill and will stop that bill in the condition that it's in without having gone to committee, but when we stop it, you see, those republicans think that students ought to be paying more interest. that's the part that's wrong. the part that we're disagreeing about is how to pay for it.

pay for it? we have an economic judgment day coming in this country because of the debt that we're running up on a daily basis. i'm not sure what's going to lap now that france has decided they're not going to have austerity and greece has decided they're not going to have austerity. that's what put the world into kind of this funk anyway. and now they have leaders that say that they're going to fight any kind of austerity. could put the world in a real crisis. but what we're talking about is whether to keep the student interest at the low rate that it is right now. and we're going to have to vote on a bill that we're going 0 have to defeat because the pay-for will make it look like the republicans want to raise the interest on students and that's not true. but the majority prefers to pick a fight rather than help students. what do i mean? after initially reaching out to my staff, indicating their

willingness to work toward a bipartisan solution, threeked their proposal before talking to us when this contained the offset that they've got in here. there could be a solution. we have to counter with one and ask that there can be two side-by-side bills. that means that we can have one that they vote against so we can say they didn't want to kipe student rates -- didn't want to keep student rates low, which is also wrong. but somehow we've got to figure this out and got to do it in a bipartisan way, and that means that probably neither suggestion that's up there right now is the one that's going to work. the majority would have americans believe that the bill simple 34reu closes a loophole -- simply closes a loophole used by wealthy people that organizes an "s" corporation in order to avoid payroll taxes. well, let me tell you about taxes. if you're in one of those small business "s" corporations, you pay your taxes.

you pay it on the year that the company earns it, not the year that the dividends are distributed. the year that the company earns it, you pay all of the taxes that are due on that piece of money. even though you have to leave it in your business so you can keep reinventing their business, so you can stay in business, so you can maintain the jobs that you already have and hopefully add a few. they's what an "s" corporation -- that's what an "s" corporation does. says we're going to give you this big break. we're going to lel let you pay r taxes up front even though you can't take your money out. payroll taxes is the money that all of us put in as an investment for our social security and medicare. that's what payroll taxes are. that's what we're talking about now charging on this money that up front has had all the income taxes paid on it and, incidentally, have also had payroll taxes paid on it. the i.r.s. is already given the

authority to check and see if people are taking out a minimum -- a de minimis distribution. there's an amount that you have to take out of your business and you have to claim it for salary. you can't just hide it, if you -- like you were rich or something. doesn't work that way. the i.r.s. has rules. the i.r.s. can claim those payroll taxes. but what we're talking about now is taking those payroll taxes, payroll taxes, remember, are social security and medicare payments. they're investments in your social security and your coma. -- and your medicare. we're talking about taking those and subsidizing that you are student loans. medicare is in trouble and once again we're talking about stealing from medicare. we did that in the health care bill. we took half a trillion dollars out of medicare and we put it into new programs. we didn't put it into a doc fix. we're not taking paying the

docks enough but l. we didn't take the money from medicare that might have been used and used it in medicare to keep the medicare system growing. no, we put it into new programs so we could say that this health care plan was paid for. that's what the payroll taxes are. now we're saying we're going to use those payroll taxes and going to use it to subsidize the student loans. when does medicare ever get the known pay for medicare? oh, that's right. we have a new board now, an unelected board, and this unelected board will tell us each and every year where we have to cut in medicare in order to pay for medicare even though we stripped all this other money out that could have paid for medicare. what a deal. well, here we go again. this tax would end the payroll taxes and by shifting them into the student loans. when we're talking about a

pairvetion as we do -- when we're talking about a pairvetion as we do all kind of crazy things around here. we shouldn't be doing them. in reality, this is an irresponsible tax increase on small businesses at a time when we need small businesses creating jobs so college students have employment opportunities when they graduate. in wyoming "s" corporations are family-owned, small businesses working hard to keep their businesses float. as i moangsed, they get to pay their taxes even if they can't draw the money out and use it. so, for instance, small mow tecialtion architecture firms and groups of engineers might choose to operate as "s" corporations. or they can be a full corporation and then they'd have some of the same benefits that warren buffett has. warren buffett makes millions and he doesn't are to pay payroll taxes on that. we didn't suggest ending warren

buffett's payroll tax-free money. we're only going thoued to the small business -- we're only going to do this to the small business corporations. sounds fair? i don't think so. so this will also hurt family businesses in another way. for example, a son who's taking an accounting practice in his father could be hit with substantial payroll taxes if he owns 10% of the firm while his father who's no longer active in the business retains the other 90%. these are not the tax scofflaws that the majority suggests this will impact. they're really small businessmen that are the fabric of the american economy. the small businesses account for 65% of the 15 million jobs created between 1993 and 20089. 65% of the 15 million jobs created between 1993 and 2009. so rather than increasing taxes on small engineering and accounting firms, we should be encurlinging these is abouts to hire new employees. as a former small businessman, i

know this will not happen if we raise taxes on the very businesses i would depend upon to turn the labor market around. recent reports demonstrate the need to encourage rather than inhibit job growth and creation. that's what we're talking about -- jobs. this year more than 50% of the college graduates are either unemployed or underemployed, graduate in a bad economy can have a negative economic consequence for ouch to 15 years -- consequence for up to 15 years. with the cost of higher education increasing rapidly, there will continue to be greater dependence on student loans. unless the economy improves, there will also be a lesser chance that going forward graduates will have the resources to even make minimum loan payments. so the republican alternative puts forward a solution that takes money out of -- and i know that the senator from iowa hates the word -- a slush fund, but

it's a fund with rather wide possibilities, and a fund that can be designated by the secretary. and this isn't the first time that this has been used as an offset. our president signed legislation that cut $5 billion from the fund to offset that payroll tax bill. we're talking about payroll taxes here again, but we're not talking about -- our side's talking about using the same source the president used for the other ones. so the president also proposed to cut an additional $4.5 billion out of that fund when he submitted his budget for this year. so, i had to go and look and see what some of the uses are for this fund that we'd be cutting

into, because it's done at the discretion of the secretary of health and human services, and there aren't a lot of guidelines. many of the programs funded by this prevention and public health fund, often called a slush fund, duplicates existing health programs or wastes taxpayer money on some frivolous programs. the fund has wasted millions of taxpayer dollars and even supported potentially unlawful lobbying activity. for instance, a public health clinic in nashville, tennessee used money to offer free preventive services for dogs and cats. not women and children. $3.6 million went to the minnesota department of health to create at least four regional food policy councils to increase access of available and affordable healthy food. $8.4 million to the new york fund for public health to

implement a local tax on sugar sweetened beverages. $3.3 million to the washington state department of health to increase control on tobacco, marketing and taxation and support legislation that repeals preemption of tobacco marketing. $3 million to lobby lawmakers in new york for legislation requiring chain restaurants to publicly post the amounts of calories they serve. $7 million to the jefferson county, alabama, to urge alabama lawmakers to raise tobacco taxes. $16 million to the county of los angeles to help secure a ban on new fast-food restaurants around los angeles. a lot of that's lobbying activity. i suppose that the end result could be prevention of health. this country is coming up on an economic judgment day. we don't have extra money laying around. in fact, when we're talking

about pay-fors, we're only talking about paying for whatever new is put in. we don't talk about how we're going to cover the $15 trillion in debt that we've got out there, the $49,000 that every man, woman and child in the united states owes. it's a heavy burden. i talked earlier about greece. greece only owes $39,000 per person. they're just not trusted as much as the united states. but if we keep running up that debt, we're not going to be trusted either. so, unfortunately, president obama and congressional democrats would rather play election-year politics than find a solution that focuses on the immediate need of america's students and their families. neither bill is ideal. each spends ten years of savings in one year, and neither produces a long-term sustainable solution. however, the republican proposal has the benefit of using an offset previously used by the

democrats, as i mentioned. the $5 billion from that fund was used to help pay for the extension of the payroll tax holiday and then in this year's budget he has another $4 billion. the democrat bill raises taxes on small businesses at a time when the nation needs those businesses to be creating jobs so college students have employment opportunities when they graduate, and it's really discriminating against small businesses because it doesn't take in corporate dividends that people get, which are the same thing. it's the dividends that they eventually are able to take out of a business, but a big corporation pays dividends to the investors, and those don't have payroll taxes taken out either. so no sincere attempt was made by the democrats to find a bipartisan solution. both senator reid and senator harkin reached out to my staff to inquire about the possibility of finding a solution. my staff expressed a willingness to discuss possible offsets, but the democrats released the details of their proposed "s"

corporation tax prior to any meeting. when my staff did meet with senator harkin's office, his staff indicated the "s" corporation offset was the only offset the democrats were willing to consider. that makes compromise pretty difficult. senator reid has filed for cloture on s. 2343, this bill that we're talking about, the democrat version of it, and a vote will be held tomorrow at noon. at that point we've been told that our version, even though we're the minority -- so unless we pull some majority people over, would not have a majority vote. if they all voted together theirs would win. but we've been told we're not going to have a vote on our bill at all. that's to make it look like when cloture tomorrow fails, because there would be no opportunity to put any amendments on this bill, and this is not a perfectly drafted bill. this is something that was put together in a bit of a hurry without having bipartisan input. the reason we have 535 people in congress is so that there are a

whole bunch of different viewpoints. the reason we have 21 people on a committee is so that there are 21 viewpoints that go into the bill and see what unintended consequences there are. didn't happen on this bill. this has been put together by two or three people or a half dozen staff members or whatever -- i'm not sure -- but it has not had the input from both sides. so our side had to come up with a bill that follows the same procedure. and i can tell you that neither bill is ideal, and a solution has to be reached for these young people. and we're all agreed on that. we're just not agreed on how we pay for it. and we do have a problem with paying for things around here. so i urge the majority leader to pull the bill from the floor, sit down with us, find a solution that all can agree to, and this isn't an issue over election-year politics that should prevent us from reaching a bipartisan agreement. i'm not aware of anybody that's

opposed to the extension of the reduction in the interest rate. incidentally, that's not an interest rate reduction to everybody. it's only to those who have subsidized loans. if you're a student who has a regular loan, you're not getting to participate in this. but that would require a lot more money to do it. so again, i urge the majority leader to pull this bill, sit down, come up with a solution that both sides can agree on. it's getting tougher and tougher to find pay-fors because we're getting further and further in the hole and we're not going to stop digging, so we better start digging together. i yield the floor. mr. harkin: mr. president, how much time is remaining on our side on this debate? the presiding officer: the senator from iowa, there is no

allocation of time evidently. mr. harkin: senator, am i correct that the time for debate on this bill will expire at 4:00 p.m.? the presiding officer: at 4:30. mr. harkin: at 4:30. i thank the chair. mr. president, after listening to the previous three speakers, it's hard to know where to begin to correct the record. but all the misstatements, so maybe i'll kind of work backwards. my good friend from wyoming gave a whole list of different things about where this money was spent. he mentioned something about california and fast-food construction. i didn't get it all, but i'm informed that there was absolutely no money from the prevention and public health fund that went for that program. if my friend has any evidence to

the contrary, i would be more than delighted to look at it. and then there was the one about the dogs and cats in nashville, tennessee. i thought the newspaper article that was in "the hill" newspaper put that one to rest, but i guess it didn't. it just goes on and on. that money also did not come. that money went, actually was funded by private grant money. i guess petsmart, from what i'm told put that money in for pet spaying and neutering in nashville, tennessee. again, that money did not come from the prevention and public health fund. my friend from wyoming has the evidence to the contrary, i'd like to look into that. and then there was a -- he mentioned the new york department of health used $3 million to lobby in new york for a soda tax initiative.

first of all, mr. president, i would tell my good friend from wyoming that there is absolute prohibition on federal moneys being used for lobbying. so if anyone has any evidence of federal funds being used for lobbyists, please let us know. we'd like to take them to task for that and sick the justice department on them. so that just didn't happen. it was not c.d.c. funding. this was funding by the new york state department of health. again, none of the c.d.c. money that we used that was in the prevention fund was used for that. those are just three of i don't know how many examples my friend from wyoming had. but those are just three of them there that absolutely had nothing to do with the prevention and public health fund, but somehow this has gotten out in the possible hrar

press -- out in the popular press that the city of nashville received $7.5 million grant to provide free pet spaying and neutering. you put that out there and the radio talk shows pick up on that and all that kind of stuff and they bat this around and gets everyone upset. they're using tax money to neuter dogs and cats in nashville, tennessee. who wouldn't be opposed to that? well, it's just not true. that's all. it's just simply not true. and like i say, if anyone has any evidence to the contrary, please let me know. we'll get the justice department after them. now, again, i say to my friend from this side of the aisle that talk about seriousness of whether or not how we're going to pay for this, i hear it said by the previous three speakers

that we all agree that the interest rates should not go up. okay. but we have before us, as i understand twaorbgs choices -- understand, two choices before us. the republican choice is the one passed by the house of representatives a couple of weeks ago which would eeliminate the prevention and public health fund and put that money in to keep the interest rate down at 3.4% rather than letting it go up to 6.8%. so they would eliminate the prevention and public health fund, about which i spoke at length a little while ago. our bill would close a loophole in the tax code that allows certain subchapter "s" korpgs to a -- subchapter "s" corporations to avoid paying their fica taxes, their medicare and social security taxes because of the

way they're arranged. i'm going to get into that in a minute and try to explain exactly how that's set up. we're not going after small businesses at all. we're simply providing, i think, more of a bright line on what are legitimate dividends from a corporation which don't have to pay fica taxes and what are really salaries, wages, salaries that you do have to pay fica taxes on. right now in certain subchapter "s" korpgs, it's kind of cloudy. it's kind of cloudy. and so someone said on the other side, they said we've seen this big increase in subchapter "s" corporations. of course. people who have had partnerships before or sole proprietorships and stuff all of a sudden are rushing to establish subchapter

"s" corporations with very few stockholders to get away from paying their legitimate taxes on social security and medicare. and so, our bill would close that loophole. so we have these two choices, i think, in front of us right now. which do you want? i mean, if those were the only two, do you want to eliminate the prevention and public health fund? or do you want to put a bright line on subchapter "s" corporations and say if you cross that line, you've got to pay your social security and medicare taxes? maybe we can have that vote. maybe we can actually have that vote here. i'd like to see if my republican friends really want to eliminate the prevention and public health fund. earlier this year i, from our

committee i passed out to every member of the senate how much money went to the individual states and what it was used for in the prevention and public health fund, because i want it to be transparent and aboveboard. so i -- i pointed out, for example, -- these are not private things. these are public. i pointed out to my friend from tennessee that $4,669,362 was made available to tennessee in this prevention and wellness fund for fiscal year 2011, and i listed all the things where it went to. community programs to promote healthy living, detection and prevention of infectious diseases, clinical preventative services, strengthening of public health infrastructure, tobacco prevention programs,

some to east tennessee state university for the training and preparing a public health work force, vanderbilt university medical center for clinical preventative services. i got it right down to the dollar where it all went. we're not trying to hide anything here. i would ask my friend from tennessee, ask these people, what did they do with the money, where did it all go? we know where it went. does my friend propose that we cut out all this money that went to the state of tennessee or here's arizona? $7.7 million to arizona in 2011. i gave this to my friend from arizona listing exactly where it went and what it went for in prevention and wellness. does my friend say this ought to be eliminated?

wyoming got $1,785,534. every bit of it is listed here, exactly where it went. well, if we accept the republicans' proposal, we do away with all that. we do away with all prevention and public health. now, it's been said on the other side that even our president wanted to -- to do away with or take money out of it. i would point out that the president did propose earlier this year as a pay-for for the extension of the unemployment insurance program and for other things to keep tax rates from going up that we took $5 billion out of this program over the life. but i think the president made it very clear, very clear that was it. in fact, we have a statement of

policy, a statement of administration policy on this bill which states unequivocally the president will veto this bill if there is any cut in the prevention and public health fund. so again, while i personally was opposed to the $5 billion that the president proposed taking out and was taken out of the fund, i can say that, well, that ought to be the last penny taken out of the prevention and public health fund, the last, no more. i think now we see the president agrees, no more. took $5 billion out and that's the end of it. and then people keep calling it a slush fund, a slush fund. as i said, i have where every dollar went and all of the states in this country and what it went for, and it did not go to neutered dogs in nashville,

tennessee, regardless of how many times you may read it or hear it onrush limbaugh or joe scarborough or someplace else. you hear it every day and it's still not true. i challenge anyone if they have that evidence, let's see it. so again, i wanted to -- i just think that what the republicans have offered as an offset is not serious. i just can't believe they want to really do away with the prevention of public health fund. on the other hand, is our proposal serious? do we really want to close this loophole on the sub chapter s? yes, we do. i think that is serious, because there has been a lot of abuse of people using the cover of sub chapter s to avoid paying their correct share of taxes.

a number of cases have come before us. i have seen where people have used the sub chapter s as a means of paying their fair share of taxes. one of the -- one of the examples that just came through was -- was former senator john edwards of north carolina, a former member of this body, former presidential candidate, vice-presidential candidate. i'm not going to get into his personal stuff. that's something else. but former senator john edwards of north carolina claimed over a multiyear period that $26 million in revenue from his subchapter s corporation was unearned. he claimed that he didn't really work for a large share of his income from winning court cases.

by making this argument, he saved nearly $750,000 in payroll taxes. that's not fair. it's a gimmick. it's a gimmick when you allow a professional to give his or her spouse and children 95% of the stock in their subchapter s corporation and then declare it's their profit and not their work as an accountant or as a lawyer that's responsible for the income. that's a gimmick. that's why people are rushing to form these subchapter s's. we have a case here, a recent case where the taxpayer was an s corporation, accounting practice entirely owned by a c.p.a. and his wife. that's the corporation. the c.p.a. served as the corporation's president, treasurer, director and only full-time accountant but

received no salary. imagine that. he received no salary. instead, the c.p.a. -- quote -- "donated his services to the corporation and withdrew earnings from the entity in the form of dividend distributions. during the years under audit, the c.p.a. worked for the corporation approximately 36 hours per week. in addition to testifying that his work was crucial to the continued success of the corporation's business, the c.p.a. also indicated that dividends were drawn in lieu of salary to reduce employment taxes. imagine that. the corporation asserted that the c.p.a. was not an employee, and even if he was an employee, dividend distributions cannot be taxed as wages. well, the tax court -- well, he was caught in an audit, caught

in an audit. we know audits are few and far between. so the court found the shareholder to be an employee who had performed significant services since wages encompassed all remuneration for services, it constituted all wages for tax purposes. so that's what's happening. that is what's happening out there. so what does our bill do? our bill -- see, right now if you're kind of in a subchapter s corporation, you, you the person get to kind of decide whether or not what you're making is income or dividends. i heard it mention something about warren buffett. i don't know warren buffett's whole deal, but it seems to me most of his income is from dividends. we're not talking about that. we're talking about -- this would be -- if we took the subchapter s situation and applied it to subchapter c

corporations, which mr. buffet wouldt would be in, then we would let mr. buffett decide whether or not his dividends were salary or dividends. how do you think he would decide? he would decide they were dirchedz. -- dividends. now, a subchapter s corporation is saying you, you get to decide, are they dividends or are they salary? well, what do you think people are going to mostly decide? and, again, this is information that we received basically from treasury, is that if an accountant sort of tells an s chapter corporation, well, you can do 40%, 40% you won't get audited. so they just do 40%, they don't get audited, and they don't have to pay social security or medicare taxes on that. so what do we do in this bill? we just say that, look, if you're a subchapter s corporation and you have fewer than three shareholders, fewer

than three, fewer than three, then we draw a bright line. we draw a bright line, and if your income is over $250,000 a year for a joint filer, then and if the -- if, in fact, that there was not earned income, then it would be subject to fica taxes, then it would be subject to fica taxes. that's the bright line that we're drawing here. not -- in fact, what it will do is it will give subchapter s corporations a better idea of whether or not they are earning money as income or earning it as dividends. so quite frankly not only are we

helping raise money for the medicare and social security trust fund, we're actually making it better for people out there who may not know where they fall. is it dividend or is it earned income? so our bill only covers a very narrow share of s corporations and it deals only with certain professional corporations. it does not touch manufacturing or retail activities. it does not touch real estate activities. it covers the area where the abuse is most prevalent right now. now, i want to speak for just a minute on what senator alexander was talking about earlier about the money that came from students and whether or not it was given back to students, he said instead of 6.8%, it should have been 5.3%.

we voted on that. we voted on that and it failed. it failed. it failed. so we did have, we did speak on that, but again what i will point out is that most of this money, most of the money that we had in that savings, that $61 billion, most of that indeed went for students. i think i had, yes, about of that $61 billion, $36 billion basically went to pell grants helping raise pell grant awards. $750 million went to bolster college access for students through the college access challenge grant program. $2.55 billion went to historically black colleges and universities and minority-serving institutions.

$2 billion went to community colleges. so about $10 billion was used for deficit reduction. $9.2 billion, as i said, went to certain health care activities. guess what one of those was that it paid for. requiring dependent coverage. saying that a young person, a person could stay on his or her parents' health care policy until age 26. now, does that help students or not? of course it helps students. how many young people go off to college, they are in college, maybe they drop out a little bit to work, make money, they come back into college. maybe they even graduate, but they don't have a full-time job, they can stay on their parents' policy until they are age 26. i can't tell you how many people

i have heard from in my own state of iowa who said what a godsend this is to them and their students and the kids in their family who are students. so i -- i make no apologies for the fact that some of this money out of that $61 billion that went to subsidize banks went to help students stay on their parents' health care policy. so when you say that some of the money came from students, no, it didn't. the $61 billion all came from cutting the subsidy to the banks. and the great bulk of it, i said all but about, well, $10 billion went to pay the deficit -- pay down on the deficit and $9.2 billion went to things like banning lifetime limits, requiring dependent coverage, expanding community health centers, that type of thing that

was used. so with none of it as i said rally actually came from students themselves. it all came from the closing of the loophole that banks were making on that money. the next thing that was said here that i wanted to correct was that the medicaid expansion in the affordable care act, i want to make it clear 100% of that expansion is paid for in the federal, on the federal side, not the state sides. i think it was senator alexander was talking about this and saying we're increasing the -- the -- or expanding medicaid. which is a burden on the states. well, that would be true, but for the fact that 100% of this expansion is paid for by the federal government. that phases down to i think 90% sometime in the future but never

comes below 90%. now if the senator would like to debate medicaid should be all federal or federal and state, we could debate that and maybe find even some common ground on it but that's not the case before us. i did not think that the debate on this bill to keep student interest rates low would now morph into a debate on health care. but if you want to have a debate on health care, more than happy to do so and whether or not we should use money from the prevention and public health fund to pay for it. so, again, i would say that no money, no money comes out of the medicare trust fund to pay for this bill. none. and certainly none comes out of the social security trust fund. the money that is raised goes to the social security trust fund

and medicare trust fund. none of it comes in to pay for keeping the interest rates at 3.4%. under the budget rules that we are operating under, money raised can be used as an offset even though that money is raised for social security or medicare. i want to make it crystal clear that the money that we are raising from closing this loophole on subchapter s corporations, that money, none of it, none it goes for student loans or to keep the interest rate low. what it does do is it goes to medicare and social security trust fund. but under the republican proposal, the republican proposal, we would not get any more money into medicare or social security. they would just do away with the prevention and public health fund, take that money, use it to offset, keeping the interest rates low, but not one nickel

of that would go to medicare or social security. our bill would. so our bill kind of really has three benefits. one, it closes a tax loophole, provides for more -- more definitive application of what is a subchapter s income or dividends, earned income or unearned income, secondly, it provides money to the social security trust fund and medicare trust fund, which is needed. and third, it allows the student loan loans for subsidiesed loans to remain at 3.4% for the next year and sometime in the next year obviously we're going to have to figure out a longer term fix for this or what we want to do on the subsidized loans in the future and how we're going to pay for this down the road.

in the meantime, as everyone has said on both sides, we both agree it ought to stay at 3.4% for the next year so the debate i guess does resolve around how we pay for it. again, from my viewpoint they want to -- not my viewpoint, the house already voted on this. they voted last week to kill the prevention and public health fund. and that's what the republicans are proposing here. again, to refer back to where i started earlier this afternoon, the lead editorial in "the new york times" today i think was quite clear. the finding is published in "the new england journal of medicine," the finding out about what's happening with type 2 diabetes, how devastating that's going to be in the future. and when they said but the

long-term goal should be prevention of obesity and diabetes. editorial said congressional republicans meanwhile are bent are dismantling health care reforms a that could help in curbing the obesity epidemic. the house passed a bill that would eliminate a public health fund established under the reform bill in farther part for lowering the interest rate on student loans for a year. as the editorial said there is no explanation for this move except for the usual anti-health care reform demagoguery. they pointed out how the fund is already providing grants to state and local governments to pay for programs to fight obesity and prevent chronic diseases including diabetes in the community, the workplace, and among minority groups. so that's really i guess the argument. how do we pay for it? i would say that it comes as no

surprise, i'm sure, i think closing this loophole is much better than doing away with the prevention and public health fund. with that, mr. president, i yield the floor. mr. enzi: mr. president. the presiding officer: the senator from wyoming. mr. enzi: mr. president, i said it before and i'm going to say it again. neither option is ideal. these ought not be the optionz we're voting on -- options we're voting on. but actually we're not going to vote on two options. we're going to vote on one option. because this is a cloture vote. when that cloture vote fails, and it will fail because it's not a good enough bill to pass, it's not a good enough bill to get 60 votes so it will fail. and when it fails, the only

purpose it failing is to say look at those republicans that killed that bill. there could be a solution, but it isn't a solution by bringing a bill directly to the floor and saying take it or leave it. it's got to be a solution by sending it to committee, having the people there work out a way that it can be done. and we've done that in our committee a number of times. and the bills that go to our committee and then come to the floor are pretty successful. but this one did not go to committee. so it isn't really two choices that we're getting. it's one choice. we can take it the way the democrats wrote it or we can per get it -- forget it. they say this closes a loophole. because if there are three shareholders or less -- i already heard people, i could hear their minds saying okay, if i want to cheat on that and you've taught me how i can, i'll add a fourth person. now your bill doesn't cover it. so it's not written properly.

you're not going to stop them by doing what you've got written in the bill. so it's not going to generate any revenue and if it doesn't generate revenue, it's not going to pay for the cost of keeping the health care down. besides that, the i.r.s. has guidelines that say how much you should be taking out of your business. as wages. and you have to pay a payroll tax on that, or you will be taken to tax court and that's what that one case is that the senator from iowa referred to, it was a case of an accountant who got caught and taken to tax court and told he can't cheat on his taxes. we ought to have more enforcement like that. and it should be pretty easy for the i.r.s. to check and see if there are some s corporations out there that hasn't paying any wages, any wages, that should be a little computer check, since so much of it -- actually every -- every return gets turned into a digital return

now. some of them you can help the i.r.s. by sending your form in digitally to begin with which saves a lot of input by somebody's part. but they could check in a moment -- a matter of seconds s corporations that have no wages. and if they have no wages, perhaps they ought to have a much lower limit than what the other side is suggesting. if we're going to do tax reform, we ought to do tax reform. to do it this way is the wrong way. now, i also heard the comment that this money is not being taken from medicare and social security. well, the way that we do federal accounting -- and we should be ashamed of the way we do federal accounting -- that can be a true statement. but in fact it is not true. here's how we do it. here's how we cook the books as the federal government. we will collect this tax that

should go to medicare and social security. and we will put bonds in a drawer and we will spend the money on the reduction in interest rates for the students. that is spending it twice because we're still showing it as owing it to the social security and the medicare folks. but we do this all the time. do you know how much money there actually is in the drawer called social security? nothing. there are tbhondz there. i used to listen to senator hol ition -- holings, democrat from south carolina, talking about how we were looting social security. looting it, because all we do is put bonds in a drawer and we spend the money and we've been doing that for decades. and so the deficit that we're talking about is probably considerably greater than what we're willing to admit. but that's what we're going to be doing here once again. we're going to be looting social

security and medicare. and providing some loopholes for them to keep on doing the same thing if they've been doing pit -- it, we'll have to get the i.r.s. on it and going better. but so if you're going to have two optionz --, options, and that ought to be a lot more options. that's not what we're doing, getting together and figuring out more options. more ways to take care of all of the problems that students are having. they're going to be demanding a whole lot more than what we're doing, and i would remind the democrats that the president did take $5 million from this prevention fund and i heard -- i heard it said he said that was enough. well, if that was enough, how come his new budget includes another $4.5 billion out of that fund? so he doesn't think that's enough. he thinks there is still more to

be taken. this is a $6 billion project that we're talking about, so $1.5 billion another way. we're just talking past each other. and that's what happens any time a bill comes to the floor here. if this is the only place we get to debate it. notice how many of my colleagues are listening to me right now. yeah, if there are two people on the floor here, it usually means one is getting ready to speak and is not listening to what is being said. that is not a debate. that's not a way to come up with solutions. what we've got to do is send these things to committee. now, senator harkin and i have a way of working on bills in committee and that's to have people turn in their amendments a couple of days ahead of time and we look at those and you would be surprised how many times an amendment by a republican is almost the same as an amendment by a democrat. the trick is to get the two of them to sit down together and figure out which words need to be changed so they can both take credit for it.

so this is a frustrating process. the wrong way to do it. but i have to answer one more thing yet and that's what i cited some cases of -- where funds were being used from that prevention fund that i thought were wrong and i do think are wrong, and the senator said that if we had some information on that, if we'd give it to him, he would make sure that the department of justice gets on it. well, now we not only need to have the i.r.s. working, we got to have the department of justice working a little bit. because there is some pretty good evidence, i think, that some money has been spent for lobbying and in some cases called advocacy. but it's by people working the legislators over and that money in my opinion is lobbying. so i do hope that this bill will be referred to committee, which is where it deserves to be, so

that a solution can be worked out. and so i would hope that if we do have that cloture vote tomorrow instead of having the bill pulled, that both sides would join in saying send it to committee and vote against cloture. i yield the floor. mr. harkin: mr. president? the presiding officer: the senator from iowa. mr. harkin: i say to my good friend wyoming, and he is my good friend, and we do a lot of work together, i wish we could have this bill in our committee. i think we could work it out. but the fact is that to raise the money has to come from the finance committee and we don't have jurisdiction over that. if we had jurisdiction over that, we could probably work it out. we have a good way of working things out in our committee. but we don't have committee over finance on this darn thing. if we did, we'd probably figure

it out. but -- mr. enzi: could i amend my comments to have the finance committee take the bill and work out a solution? mr. harkin: i think that's what this came from, i think. i don't know. i'd say to my friend also from wyoming, listening to him, i think it's fair, i think it's fair that if we're going to have a vote on ours, that we ought to have a vote on yours. i think if we're going to have a vote, we ought to have a vote on ours which is the subchapter s corporation, see how that falls, have a vote on whether or not we went to end the prevention and public health fund, and use that money. i'd love to have that vote. i'd like to see how my friends on the other side of the aisle want to vote on whether or not they want to kill the prevention and public health fund. so i'd also say that on this

subchapter s corporation thing that the i.r.s. right now audits about .5% of the returns from subchapter s coarpgdz. .5%. so you got to think what are the odds they're ever going to catch me? if they do, i pay a fine. that's it. now, the i.r.s. just don't have the personnel to do that. so what we're doing here, i want to say again, just to make it very clear, that because of the sort of fog that surrounds s chapter corporations right now, because of that fog, the i.r.s. simply can't audit them all, they don't have the personnel to do that, and there's a lot of questions about whether or not something is income or dividends. but let me repeat again what our

bill does. we create a bright line test, bright line, it affects only a narrow class of subchapter s corporations, it affects professional only, professional subchapter s corporations, those engaged in professions such as doctors, lawyers, accountants, lobbyists, where the campaign is due to the professional work. this provision does not include subchapter s gains from unrelated retail, wholesale, or manufacturing activities. the provision only covers subchapter s corporations where there are three or fewer stockholders. it only covers those earning more than $250,000 a year as a joint filer. and it only covers the portion of the gains that come from professional services. so if a subchapter s company has

income partially from professional activities such as lobbying, and partially from other activities such as real estate investments, the investment income does not fall under the rule. the joint committee on taxation and the treasury inspector general for tax administration have both issued reports that shows that underreporting of earned income subject to fica taxes is a significant issue. using i.r.s. data, the government accountability office in 2009 calculated that in 2003 and 2004 tax years, the net shareholder compensation underreporting amounted to nearly $23 billion. since then, the number of subchapter-s corporations have been increasing rapidly. increasing rapidly.

and i would suggest that's why. lastly, i just want to point out, for the record, to my friend from wyoming that the house bill did not go through the committee either. they just brought it directly to the floor, did not go through the education committee. only went through the rules committee and then to the floor and so they did the same thing. they didn't go through their -- their committee either. so, again, i'm hopeful that we can work this out but if we -- if we can't, i say to my friend, i hope we do have an up-or-down on both -- both provisions here. with that, i see my friend from florida is here. i yield the floor. mr. nelson: mr. president? the presiding officer: the senator from florida. mr. nelson: thank you, mr. president. mr. president, i took the opportunity to meet with several students over the course of the

past week while we were back in our states and i want to share with the senate some of those thoughts. did the chairman of the committee have something additional that he wanted to say senator harkin, did you have something additional? you look like you have something else? mr. harkin: i thank my friend from florida. there's one other thing i wanted to mention before i -- before i leave the floor this afternoon and leave this debate on the -- on the student interest rate bill. and that is i've heard time and time again from the other side about the fact that the president took $5 billion out of this and the fact that i said earlier that, yes, and that was the limit. that was -- that was all. and he didn't want any more taken out of it. well, then someone said, well, but he's got $4.5 billion in his budget to take out of it. well, what happened is the president did put $4.5 billion

in his budget to take out of the prevention and public health fund. which, by the way, i oppose. that comes as no surprise to anyone. then when the house and senate earlier this year were engaged in negotiations on extending the unemployment compensation and also the payroll tax deduction, when we were engaged in that, they put that on the table. the president stuck with his $4.5 billion. the congress added another $500 million and they come up with the $5 billion cut to the prevention and public health fund. so the president said, well, okay, that was in our budget. if you want to use it for that, use it for that, but no more. as i said, we have a statement of administration policy that says that if this is in the bill, the president -- if the elimination or any cuts to the prevention and public health fund are in here, he will veto the bill. and i just wanted to make clear that that $5 billion and the

$4.5 billion are one in the same. they're not $9.5 billion that he wanted to take out of the prevention and public health fund. i wanted to make that clear. i thank my friend from florida for giving me this time to clear that up. mr. nelson: and i thank the chairman and the ranking member, the senator from wyoming, for all of their hard work on bringing this important legislation to the floor. did the senator from -- mr. harkin: mr. president, i would just ask consent that my remarks appear before the senator from florida took the floor, so it would be connected to my earlier remarks and not disjointed. the presiding officer: without objection. mr. nelson: thank you, mr. president. i wanted to add and try to paint a personal face of some of the students that hi met with this -- that i had met with this past week on how it's going to impact them. but let me just set the table by

saying that we voted on this back in 2007 in order to give some relief to students. and we cut the loan interest from 6.8% to 3.4% for undergraduate stafford loans. and the whole idea was in this time of economic trial that you would give some little break to students. and, indeed, it is and has been a break. it's something like on the average a thousand bucks a year that we're looking at on a student saving in extra interest payments on these loans. and when it comes right down to the personal stories, they are -- are wrenching. at the university of florida, meeting with a group of students this past week, a young woman --

i won't use her name -- because they just broke down in tears. and she pointed out how not only did she have stafford loans but that her mom, who had gone through school as an adult raising a family, had gotten a degree in computer science, could not get a job, was going back to school because she had an l.p.n. associate degree and wants a register's nurse degree, where she can get a job, and so the mom and the daughter both were having a considerable number of loans. and this young woman just absolutely broke down as to what it was going to be in the way of a financial burden.

over at the university of south florida in tampa, the student body president, matthew diaz,s, "you're -- diaz, said, "you're cutting down on the dreams of an entire generation." another student at u.s.f., emanuel catalin, a political science major. he said that he's the first in his family to attend college and he questions if we don't give this break on interest whether his brother and other members in his family are going to be able to pursue higher education. another student, austin prince, a sophomore, microbiology and chinese major, wondered how in the world students are going to make it in this kind of economy if they are mired in debt. he said, "it reduces consumer buying power if you're paying

off loans for 20 years." and at the university of florida, madison todd, a political science major, said she took out the maximum amount of loans available to attend the university of florida and her family has been scraping together everything that they could in order that she could continue her education. now, why is this important? can we remember back to world war ii when we defeated two enemies on either side of the globe and all of those g.i.'s came home and for the first time we had a major part of american youth under the g.i. bill going into college?

and what did that do? america was at the pinnacle of our power and influence in the world and then with that generation of young people getting educated like they never had before, all of a sudden we had an expanding middle class as we went into the 1950's and the 1960's. you'll also remember that was a time of attention to high technology because we suddenly found ourselves behind the soviets in the space race with sputnik and then gargarian going up. and all the more kids went into math and science and technology, and look what that spawned in the generations to come because of education. and a lot of that came directly out of the g.i. bill. and now are we to adopt policies that are going to reverse that

trend? well, we tried to take care of it in a diminishing economy as we slipped into the recession back in 2007 by saying, it is a matter of policy that we should lower interest rates for students who want to get their education. and here we are. and what this boils down to is, how are we going to pay for it? it costs $6 billion for one year. now, the house of representatives has taken a position -- and that's been discussed here -- their position is to take it out of the health care bill. well, when you take it out of the health care, you're taking it out of diabetes screening, heart disease screening, cancer screening for breath and cervical cancer. do we want to do that? i don't think so.

do we want to take it out of antitobacco programs to try to keep kids from getting hooked on tobacco? i don't think so. do we want to take it out of childhood immunizations, where the spending of $1 on chilehood immunizations by the federal government saves the government $16 in the long run? that's a ratio of 1:16 because of children not getting the diseases that they were immunized for. do we want to take it out of that? i don't think so. so what have we come up here with in the senate? we came up with a narrow part of the tax-paying public,

subchapter-s corporation individuals that pay individual tax, not corporate tax, and only those in a joint return above $250,000 gross income and they would do what? they would pay the payroll tax, medicare and social security, that they do not pay under the existing law now because they're treated as if they were a corporation instead of a partner which, in effect, they are save for the tax laws. now, that's the choice. all right, if this vote does not get 60 votes today in order to break the filibuster, or even if it does, we have to reconcile

the pay-for for the $6 million that this student loan interest bill will cost. and it is my hope that common sense, that bipartisanship, that noni had lodge qual rigidity -- idiological rigidity will rule the day and that we will simply ask what's best for our people and for our country. mr. president, i yield the floor. the presiding officer: under the previous order, the senate will proceed to executive session to consider the following nominations which the clerk will report. the clerk: nominations, jacqueline h. nguyen of california to be united states circuit judge; kristine gerhard

baker of arkansas to be united states district judge, john z. lee of illinois to be united states district judge. the presiding officer: under the previous order, there will be 60 minutes of debate equally divided in the usual form. mr. leahy: mr. president? the presiding officer: the senator from vermont. mr. leahy: mr. president, for the last four months, the senate has been forced to slowly work its way through the backlog created by republican objectio s issued last year to consensus nominees. the distinguished presiding officer knows the number of nominees that we have voted on unanimously usually in the judiciary committee and then they have to wait and wait and wait to get a vote. now finally, with the consideration today of the long-delayed nomination of judge jacqueline nguyen to fill a

long-standing judicial emergency, a vacancy on the overburdened ninth circuit, the senate will complete the confirmations that it could have, that should have taken place last year. in my 37 years here, it's been my experience with republican and democratic administrations, republican or democratic control of the senate such nominees were always disposed of by the end of the year in which they'd gone through the committee. now, actually five months into the year, today is the first time the national is considering judicial nominations reported by the judiciary committee this year, not that they were just reported; they've been on the calendar for months. the nominations considered today are but three of the 22 judicial nominees available for final senate action. most are by any measure consensus nominees who could and

should be confirmed without further delay under either republican or democratic administrations. actually, if they were confirmed, if i cannily confirmed, that would go a long way toward getting us on track to make real progress to reducing the judicial vacancies that have plagued the federal courts around this country. mr. president, if i might, i want to share this chart that compares vacancies during the first term of president george w. bush and president barack obama. it shows the vacancies under president bush. during part of that first year -- actually i think 17 months of that first year, the democrats were in charge and we

dramatically and quickly moved through president bush's nominees, brought those vacancies way down. and what's happened? we get down to 28 vacancies. now we have president obama. it has just gone skyrocketing up with vacancies, not because we've had nominees. we've had nominees. they go through unanimously in the committee and they have to wait and wait and wait and wait. many times the majority leader has had to file cloture to get them through. so they will be delayed again for weeks. we get the cloture vote, then we have the final vote and they go through 95-2 or 100-0. i mean, it is -- it shows such blatant disregard for the

integrity and the independence of our federal judiciary. as i said, during president bush's first term we reduced the number of judicial vacancies by almost 75%. when i became chairman in the summer of 2001, there were 110 vacancies, partly because the republican-controlled senate under president cline it unhad pocket-filibustered over 606 his nominees. but actually, let's change that. let's change that kind of gamesmanship. as chairman, woirked wit, i wore bush administration and senators from both said toes of the aisle to confirm 100 judicial nominees of a conservative republican president in 17 months. and you can see on the chart, look how that sloped, straight

down. o-that's a steeper slope than some of the ski slopes in vermont. and when we were in the minority, we continued to work with senate republicans and confirm president bush's consensus judicial nominations well into 2004, a presidential election year. in fact, ten at the end of that first year, the senate acted to confirm 205 circuit and district court nominees. the chart notes where we stood in may 2004, having reduced judicial vacancies under 50 on the way to 28 in august. look how little has been done now. look how long vacancies remain near or above 80 during the four years of president obama's first term. not because the nominees weren't there. they are. but because they are stalled beyond any amount of time that

any president that i can remember has had them stawvmentd i came here -- has had them stalled. came here when president ford was president. nobody has stalled tha was stal. if we could move forward on senate votes on the 22 judicial nominees ready for, a the senate could reduce vacancies to less than 60 and make progress. also today marks the first action this year to address the needs of the ninth circuit, by far the busiest federal appeals court in the country. i say "busiest. " appeals court anywhere in the country. the senate has long delayed the nomination of jacqueline h. nguyen, five mounts ago. back then it was reported unanimously. every single republican, every single democrat on that committee voted for her. the nomination ha is one of thr0

nominations currently pending. with nearly three times the number of cases pending as the next busiest circuit, we can't afford to further national votes on the other two nominations, paul wattford of california reported favorably by the senate over three months ago, or andrew hurwitz of arizona reported over two months ago favorably. and given all three are superbly qualified mainstream nominees with bipartisan support a, the long delays that practicing these nominations are hard to understand. and look at the amazing stoamplets judge wynn, her family spled to the united states in 1975 after the fall of south vietnam. she was confirmed unanimously to the district court in 2009. the senate judiciary committee unanimously supported her nomination to the ninth circuit

last year. in fact, when confirmed, she'll be the first asian-pacific american woman to serve in a u.s. court of appeals anywhere in our country. she's the kind of nominee who should have been confirmed in five days, not fist amongsts. -- not five months. we still are waiting for republican agreement to vote on the other nominees. the nominees would never be considered controversial during any administration, republican or democratic. paul wat watford was rated unanimously well-qualified. that's the highest rating possible. he clarkedty united states supreme court for ruth ginsburg. he was a federal prosecutor in

los angeles. i do have a special place in my heart for prosecutors. he has the support of his home state senators, bipartisan support from noted conservativ conservatives. justice hurwitz is a respected jurist on the arizona supreme court. he also had the highest rating possible and unanimously. i should also note, this is not a partisan thing. his nomination has the strong support of both republican home state senators, senator john mccain and senator jon kyl. now, when the republican leader came to thand the majority leado an understanding of 14 judicial nominations awaiting consideration, the arrangement took months to implement. the senate could have done it in

ourhours. the senate could have easily done it on a friday afternoon. because it has taken so longer the backlog of judicial vacancies and judicial nominees continue. so we're right back where we started. we have 22 judicial nominees awaiting action. i know the majority leader is working to continue seeking republican agreement to debate and vote on the remaining judicial nominees. this shouldn't require overcoming a filibuster and political partisan standoffs for the senate to do its job, promptly considering judicial nominations, especially as many have bipartisan support. i've said many times, mr. president, people of our states elect us and expect us to come here and vote "yes" or vote "no." by stalling these things and not bringing them to a vote, we get

to vote "maybe." what a way to do something. does that mean we then go back home and say, oirnlings a looking at this -- i might vote or i might not vote? no. vote "yes" or note "no." i wouli don'thave any respect fg we'll vote "maybe." we'll just vote in limbo. we'll vote "meafnlt" no the american people expect us, six-year terms, to at least have the courage to vote "yes" or "no." despite 20004, president bush being a president lengths detection year, we were able to reduce vacancies to the lowest level in 20 years. 2008 another presidential election year we continued to work to reduce judicial vacancies right through to october and we were able to reduce judicial vacancies back

down to 34 vacancies. i accommodated senate republicans and actually continued to hold expedited hearings and votes on judicial nominations into september of 2008. so let's go back to what we were certainly willing to do for a republican president and today's votes have to be a starting point for considering this year's judicial nominations. if we want to even begin to match what we did in 2004. both presidential election years years, both years with a republican president, both years where democrats said, let's treat the federal judiciary as the independent body it's supposed to be. let's honestly standed upped and vote "yes" or "no." and let's get rid of some of these vacancies. every court that has a vacancy

means that people are being denied justice. it's not a question of well we'll let republicans go to this corn, we'll let independents go to this court. no the merps, they paid for these courts, they ought to at least have a judge in them. mr. president, i ask my full statement be made part of the record. the presiding officer: without objection. mr. leahy: mr. president, i suggest the absence of a quorum and ask consent the time be divided equally. the presiding officer: without objection. the clerk will call the roll. quorum call:

.

a senator: mr. president? the presiding officer: the senator from arkansas. mr. boozman: mr. president, i ask consent that we dispense with the quorum. the presiding officer: without objection. mr. boozman: i rise today in

support of kristine gerhard baker's nomination as united states district judge for the eastern district of arkansas. she is a great lawyer recognized by her peers for her dedication to litigation on a wide range of issues from deceptive trade practices to first amendment matters. i had the opportunity to introduce her during her confirmation hearing before the senate judiciary committee, and after reviewing her record and meeting with her personally, getting to know her, getting to know those that know her, looking at her reputation, looking at her abilities, i am confident that kristine's experience makes her qualified to be the next eastern district judge of arkansas. kris moved to arkansas in 1994 to pursue a j.d. from the university of arkansas school of law. during law school, she established herself as a hard worker, committed to success.

she graduated with high honors and was articles editor for the arkansas law review, a member of the board of advocates and a member of the university of arkansas' first amendment national moot court team. kris began her legal career after graduation as a legal -- as a law clerk for judge susan wright, then chief judge for the eastern district of arkansas. in 2000 she joined her current law firm, quaddlebaum and groom and became a partner two years later. i believe her litigation experience has given her the knowledge, the skills and the temperament needed to successfully serve on the federal bench. i am honored to recommend that the senate confirm kristine

gerhard baker to serve the people of america as the judge for the eastern district of arkansas. i note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

a senator: i ask the calling of the quorum be suspended. the presiding officer: without objection. mr. grassley: is it appropriate under the senate's schedule to start debate on the judges? the presiding officer: the judges are pending. mr. grassley: today the senate is expected to confirm three additional judicial nominees. with the confirmation of