gettingrepublicans do agree e idea to raise taxes on the middle-class. when we talk about that we talk about the marginal rate of income. the tax that we put on the generation of wealth and income. we want more of that. we want people to have more wealth and money and we encourage that type of growth. the payroll tax is a specific tax. i do this a lot. i travel light district and talk to a lot of retired people. they are adamant they paid for social security benefits. they are right that they have. they paid it out of the payroll tax. that is a specific flow of funds that funds at social security. the real question is whether -- not whether we should be raising or lowering, it is should we continue to increase the amount of money we take away from

social security to fund these initiatives. i think the time has come for us to say to people, if you want social security to stay healthy, you have to continue to pay into it. if you want to continue down the road of stealing from social security in a different way, that is all we are doing. we are borrowing from social security to pay for this over here. if we continue to do that, we will have to fix the system sooner than later. there is no free lunch in this town. stealing from social security is no exception. guest: a new residence south

carolina. south carolina is a major military president -- residents. the short answer to your question is, yes, it does bother me. not in a general sense. i am one of the republicans who happens to believe there are cost savings to be had in the department of defense. to freeze defense spending at 2011 levels as part of the simpson bowls. with that said, these automatic sequesters represent roughly 10% of the budget for the defense department in 2013. that is a significant one time here without a lot of time to prepare for it. there are a deficiencies to be had in the department of defense. i think the sequesters are probably not to the best way to accomplish that. i do hope we are able to find

other savings in order to alleviate those reductions to the defense department. i am not one of the folks who think we can just wave a magic wand and get rid of these cuts. we have to find savings. it will be something we deal with between now and the end of the year for sure. >> we are talking about year end spending battles. our next call comes from gary, indiana. caller: i heard the congressman nick statement about taking from one group to give to another group. he did not see that as being right. you have been doing that for years. you turn around and took the money from the poor folks and gave it to the banks of the rich. that was a transfer of wealth. secondly, as far as social

security is concerned, and agreement was made between government officials -- not government, government officials and people. we are going to take this amount of money from you and do this when you retire. that is an agreement. right now you cannot uphold that agreement because you have taken the money. i look at it as theft. when you take money from a person that you made an agreement with and it taken for what ever you see what to use it for and not use it for the purpose they give it to you, you have stolen the money. secondly, when our corporations and politicians going to do with spending in the budget. you all benefits and profits are never in this budget. the american people are constantly giving sacrifices and you are all doing nothing but sitting back and making these

laws and that these rules. host: to every much. guest: the bank bailouts. the transfer of wealth. you are right. i think if anything we have learned from that again -- there should be lessons to learn from the stimulus, lessons to learn from the bailout. it was the largest wealth transfer in our nation's history. a lot of republicans tend to agree with you. what we did while perhaps necessary as argued by some, the truth of the matter is we took a lot of money from taxpayers and give it to fox and wall street. i think the credit capitalism is something that has come under scrutiny especially under republicans. there are a large group of less that look at occupy wall street and think, maybe there is a

common ground there. if you are against chronic capitalism and i am against chronic capitalism, -- cronie capitalism, maybe we can find a common ground. you are not alone on my side of the aisle. if you expressed it exactly right. we said we would take this much from you during your life and to beat this much. the payroll tax is changing the deal. how could you take less money out of the system -- pay less into the system and still provide payments on the back and it? we have set up a system that is designed to fail in the long run. we need to fix that with payroll taxes that are coming out this month. by the way, if you are in the system right now, the money is there. it is not cash. is not gold, it is not -- there

are these government notes that are there that could be turned into cash to pay the benefits. the issue is not today but in the issues of 50203724 is if the system is still in place. you talk about not taking any cuts. one of the most ironic things since i have been here, the truth of the matter is we have not cut spending. the federal government is this -- is bigger this year than it was last year. one of the only cuts that have taken place fifth, the budget we proposed in march was a significant first step in trying to solve our spending difficulties. we will cut our budgets that we used to run our offices by 6% this year. those are real cuts and the only real cuts that are happening.

you make some very good point. i encourage you to do some research. maybe you will find out there are a lot of republican starting to share some of the same frustrations you express. >> our next call comes from john calling from san antonio, texas. sit back and give me a few minutes if you do not host: mind not a few minutes, we do not have that much time. caller: nobody has really talked about government sacrifice. the only way you are going to solve what you have, you cannot continue to pay government employees more money than we taxpayers can afford to pay. any business or they pay more money out to the employees -- we pay more money to the employees

that the company takes in, that company is going to be bankrupt or seek protection while he gets rid of the problems he created by paying so much money to so many people. it is the same thing with you guys in congress. you have janitor's making $69,000 in the public sector while objectors who paid their wages in the private sector only makes $20,000. i am sorry, you are not worth it. if you want to cut the, cut the department of education. don't cut it over 10 years, cut it over one day. at the department of energy. but it today. that is a real cut. anything else, 5% here or 10% there, those are not real cuts. you need drastic cuts. john, we will leave it there. guest: thank you for asking the

question about spending and government sacrifice. keep in mind even though these things have not become law this year, the republicans in the house of delegates up spending -- shedding light on the spending problem. pfft the republican budget would have balanced the budget in eight years. the cut the -- cut and balance plan would have exchanged for real cuts this year. if you go to the youcut website, you will see many proposals that members of the republican caucus have come up with to shrink the government. getting it down to 10% through attrition. we are trying to offer real ideas on cutting spending because we know exactly what you

are saying. in order to balance the budget tomorrow, we would have to cut the federal government 40% across the board. that is how much money we borrow. it is a real problem. there is no question. i will suggest to you this. we have not accomplished anything this year mostly because of the things robb has mentioned and we started here today. hist all of our budgets that we send over, they have increased all of our jobs bills to try to put people back to work. democrats in the senate have passed -- democrats have sat on it. we are no longer talking about health care. we are no longer talking about another stimulus plan. we are talking about spending. how to fix the spending problem. we are like to our economic malaise. how difficult it is to grow an economy when you have 15 trillion dollar debt. the language in washington has changed. the first to fix your problem is

admitting you have a problem. if i wanted to look at a silver lining for the first year in congress, we at least have washington to start to admit it has a spending problem. host: we have a tweet from the joseph ramirez who wants to know, did you assign to the norquist tax pledge to expand on that, tell us why if he did or why you did not how has that played into the debate as you see it on capitol hill regarding spending cuts or spending increases. guest: i did this question occasionally. i have spoken to tens of thousands of people. grover norquist corp. -- works for a company called americans for tax reform. they ask you if you will pledge

to the citizens of your district that you will not raise taxes without some offset some or else. it is a commitment not to or the overall size of the government. i was happy to sign it because it reflects my principles. it was not to individual or lobbying group. there are very few people who are critical of this pledge. it says, i hereby pledge to the residents of the fifth congressional district of south carolina of such-and-such. i saw in very few pledges. i have signed two or three over my course of politics. that one more than any other very succinctly laid out my principles about growing the overall size of government. i do not think it is limited in any way in a discussion. we have had discussions about closing loopholes. we have had discussions about making taxes more fair.

the jobs plan the republican study committee -- committee offered a few weeks ago reduced corporate subsidies for ethanol and green energy and oil. i do not consider that to be a tax increase. i consider that to be fixing an unfair tax system. we should tax people on how much the consumer and how much they make -- not how they spend their money. you might spend your money on buying a prius and i might buy a hum eighthvee, that should not changed how yuch we spend on taxes. the pledges of the people back home, it will be up to them on whether i keep my word or any other issues. >> you mentioned earlier in the interview about the unemployment rate in south carolina. talk to us about the high unemployment rate and help the people who are unemployed right now are going to be effected if

the unemployment benefits extension is not extended. guest: it is reported at about 50% in my district. you can take that as 12% or 20%, but let's talk about it in terms of 15%. on one hand it is easy to say, these folks are out of work. it will need help. when their benefits run out they will be in a real pinch. i have to measure that to what i see on the ground when i go home. i tell this one story. this story is just symptomatic of many stories i have heard. i was talking to a firm that was looking to hire people in cherokee county. they could not get people to come to work. i asked them if it was a lack of skill sets. are we now preparing people for this particular job? it was a job and manufacturing. this at the skill sets are here because we treat these people. these are people we laid off in 2008 during the downturn. we would back to them one month

ago and said we are growing, things are back. would you like your job back? the answer was, i have eight months of benefits left. why don't you call me at 7.5 months. i have to balance those two things. the safety net purse is the impact that subsidizing unemployment has on employment. if you pay people to be unemployed, you will get more of it. we have to do that balancing act before the proper role of a safety net and were you cross a line and start creating a society where people would rather stay home. i think in this circumstance, the guy who was trying to hire the folks at that the research at fault for making dollars an hour to stay home. the mix $60 an hour to go to work. that we too are only making $4 a month to do heavy manufacturing. many people would rather stay home. it is a very difficult decision.

is a hard decision to analyze. it is a difficult decision to explain. as long as we continue to subsidize unemployment, we will get more of it. host: back to the phones, calling from omaha, nebraska. callecaller: i do not believe f the unemployment on how people would not work. i made at $7.25 an hour. i will tell you what, if the call me today, i would surely go so i could have my insurance and everything. i have another question. you are all for jobs, right? i have not seen you do any job since you have in there except for -- you have done this "in god we trust" and all of these little things that do not really

matter to me. i need a job that pays for my bills. i hardly make it with $7.25 an hour. i do not know where you guys think that we are getting our money from. we need help. we need jobs. give us some job so we can say that you are worth paying for. host: we will leave it there. guest: 2 wafer much. the unemployment issue is a balancing act. you are the solution. you are how we fix this thing. the folks who want to work to will work for the sake of working because they do not want to take the benefits. those are folks for who the safety net is designed and it needs to be there. you are not one of the ones who are abusing the system. my job is to make sure the taxpayer dollars is spent properly on folks like yourself who are using the safety net because they need it and is a proper reverses the folks who are abusing the system. that is one of the balancing

acts that i go through. your story is just as inspiring -- i met a teacher in lancaster county who was coming off of unemployment to go back to work as a teacher. she was going to make less money teaching that she was collecting through her various benefits as a single mother of two children who have been laid off. she said i in taking a pay cut to do this. not only that, now have to pay for my child care or as if our state, to provide for them myself. those are the people who will help fix the country. those people whose dedication to work is how we will solve this together. we do have a system that encourages a small minority of people to take advantage of the system. it is my job to try to weed that part of the system out that warps the overall culture. to your larger point about jobs, i hear what you are saying. the in god we trust and did not put anybody back to work. do not overlook the fact that we have introduced over 20 jobs bills. we did not do a major large jobs

bill like the president did that spends a lot of money because that is not how republicans think. we have offered over 20 jobs bills in the house that got to the senate. your friends in the senate -- you call the democrat friend, they have killed every one of these bills. he lived in nebraska with to understand what have been a major beneficiary of this keystone pipeline that we voted to fund at the house. tens of thousands of people would be put back to work in your state. the president and the democrats are fighting that at every single turn. now the put off any decisions until after next election. these are jobs that could be available today in your home state. republicans in the house are fighting for it. i encourage you to do the research. but to the republicans' website and find out what we have done on jobs. we have tried every single step of the way. democrats want to put people back to work, republicans want to put people back to work. if you cannot agree on that, i do not think you can agree on anything. we cannot agree on how to do it.

i give very disappointed when i hear people say republicans want people to be unemployed. nothing could be further from the tree. we want you to go back to work for more than $7.24 an hour. we go about it a different way than the democrats. we are fighting in our own way. i wish it were different. all we can do in the house is passed we think are good bills i will put you back to work and let you decide whether you want to go our way it is the private sector to put folks back to work or go to the democrats' way and use the government. >> you have come out as endorsing government -- if gov. rick perry and the gop primary. tell us what you have endorsed the texas governor. had eight handed a conversation with it. he said, i need the best ideas i can possibly get. i need the best people on my team can get. i am putting together an economic team. would you tell me on things like

tax policy at entitlement policy. he did some of the other people who were helping him including steve forbes and other people who have not come out publicly yet. that is an attitude you never get from a presidential candidates. that is an attitude you get from a real leader. from somebody who knows that he or she cannot do the job by himself. somebody that recognizes that delegation is an important part of how you run a business. this is the most important and complex business in the world. the american government is the most complicated business on the face of the planet. no one person can run it. the simple self awareness that this is what to be a team effort in order to fix the country spoke volumes to me. i was able -- i was extraordinarily impressed with that. i thought he was an inside will die. is he a great debater? absolutely not.

this is petty stuff here and there. the truth of the matter is i think the government -- the governor offers real ideas and a real track record. i hope over the next couple of weeks he can do better. i am comfortable with any of our republican candidates. to this process -- to the campaign primary process, to ever the republicans offer will be better for it in the and then he or she was going through the process. president obama prove that through his tough primary with president clinton four years ago. he will see the same thing in the republican primary. >> tonight on c-span, a hearing looks at the pros and cons of taxing, and purchases. that is next. republican senators on the proposed keystone oil pipeline. after that, a house debate from

earlier from unions in the workplace. president obama calls for payroll tax cuts for workers. >> within 90 days of my inauguration, every american soldier and every american prisoner will be out of the jungle and out of their cells and back home in america where they belong to. cameorge mcgovern's pledge in nearly one decade after being one of the first senators to speak out against the vietnam war. he suffered a landslide defeat to president nixon carried his campaign changed american politics and the democratic party. he is featured this week on "the contenders." live friday at an o'clock eastern.

-- 8:00 eastern. >> in 1992, the supreme court ruled that retailers with no physical presence in a state did not have to collect sales taxes for the state. state lawmakers and executives from online retailers ebay -- ebay, amazon, and overstock testified at this hearing which was chaired by lamar smith. i recognize myself in the opening statements. i will introduce the witnesses and we will proceed to questions. but friday marks the unofficial beginning of the shopping season. over the past few years, many americans have begun to wait

until the monday after thanksgiving to shop. on cyber monday, the offer deals similar to the permissions -- promotions they find on friday with one exception -- they do not find a sales tax. i negative inference, a state may not unduly burden interstate commerce. as applied to state tax policy, the dormant commerce clause prohibits taxing a person with to it in texas. a texas refers to the relationship between the texas refers to the relationship. the court established a bright light physical presence rule for

sales tax nexsus. the supreme court was concerned with burton's to small businesses. it reasoned without a bright line physical presence role for nexus, thousands of jurisdictions across america each with their own unique tax bases and rates would use concepts like economic nexus to impose a sales tax on businesses. uncertainty about what jurisdiction has power to tax as well as compliance with numerous and difficult tax policies, they place an undue burden on interstate commerce. today we will hear testimony from online retailers, britain motor retailers, and state governments about the impacts on their operations. this hearing will board two issues. whether commerce -- congress should enact a sales tax reform legislation and if congress should act, how we can do so in a manner that does not increase

administrative and compliance burdens on the americas and small businesses. some in the on-line retail community believes physical presence is a find room for sales tax nexus. most states cannot require those online retailers to collect sales tax. some argue that children businesses from the complex patchwork of sales tax laws was precisely the method that congress should take no action. it is precisely this reality that frustrates a brick and mortar retailers to cling to suffer a competitive disadvantage compared to their online counterparts. state revenues are also effected by the "rule. 45 states in the district of columbia have a sales tax. residents must pay for the

usage, consumption, or storage of goods purchased in a non resident state and brought into the residence state. for example, a shopper in austin, texas who buys goods from a retailer that lacks the physical presence in texas is responsible to pay texas use tax even though he or she pays no sales tax on his transaction. states rely on taxpayers to self report their purchases and other states. states lack the resources and it means to effectively police use tax avoidance. online purchases usually escapes taxation altogether. some believe congress should not come to the state's assistance. if a state chooses to impose a tax, they should also find a way to enforce it. i am aware of three legislative proposals that could give states nexus over other sellers.

the main street fair this act in congress. the have introduced the marketplace equity act. most recently, senators have introduced a marketplace fairness act. although this is an oversight hearing, i invite our witnesses to comment on any of these three bills. i look forward to hearing from our distinguished panel of witnesses and kingdom for their testimony. before i recognize the ranking member, i would like to recognize a member of the committee for a unanimous consent request. >> i am sorry i will have to go to a hearing on the house administration to decide how much we are going to cut every committee. i cannot miss that. if the gentleman will not allow me to go -- past that it be made

part of a record. >> without objection to why. the gentleman from michigan. >> the thank you members of the committee. i wanted to associate myself with the chairman's opening statement and a description of why we are here this morning. i am glad that keep mentioned my bill. the only thing i regret it is that he is not a co-sponsor of it yet. we will see how this hearing proceeds. we will see whether we can enjoy the benefit of his support.

now, we all know about the quill decision. since the quill decision there has been a tremendous growth in online commerce. the number in diversity of goods purchased from large online retailers with little physical presence in the buyers state has dramatically increased. it puts it up to 36% now. 38% over the weekend. 38% is now online. the result, of course, is that online retailers have -- let's face it -- an unfair advantage over local and small businesses who are required to set up -- collect sales taxes. what we are doing today is

exploring the need for legislation to level the playing field between small businesses and on-line retailers. main street retailers, local mom-and-pop stores in many instances, and even some of the big box retailers suffer when they have to select a sales tax but online retailers do not. your purchases at lower retailers means less local jobs. i might suggest to you that that 38% retail number is going cup. the number of people purchasing over the internet is going up. it is a 38% already.

lower sales at lower retailers means lower revenue for local and state governments. sales taxes constitute a significant revenue source in each and every state. with ever increasing online sales, state and local government anticipate larger and larger revenue losses as a result of uncollected sales taxes. michigan, my state for example, estimates that it has lost a round at $368 million each fiscal year and it will lose more than $450 million in the fiscal year 2013.

the impact of such lost revenue is reflected in extracurricular activities at the public's school systems across the state. bridges and roads in need of critical repairs are neglected and reduced services even for police and firefighter protection. h.r. 2701, the main street fairness act would grant the consent of congress to the streamlined sales and use tax agreement drafted by local and state governments in the business community to simplify sales tax rules in administrative requirements making it easier for businesses

to collect sales taxes across state lines. already 24 states have changed their laws to comply with this agreement. i await your consideration -- of the great witnesses we have, mr. chairman. we urge that we consider the relative merits of all of the bills that are before this committee. i thank you. >> thank you, mr. conyers. i also would like to recognize congressman steve format. he is the author of the marketplace equity act. we appreciate you introducing that. i will go to the introduction of our witnesses. mr. conyers this will introduce going from left to right our first witness. >> thank you.

i am happy to introduce our first witness of this hearing because he is a small business owner from of lansing, michigan. dan marshall. a second-generation operator of a family chain of music stores called martial music. -- marshall music. as a failed musician, i should visit you as often i can when we have the time in this busy, chris. -- busy congress. his parents from the store in 1948. it has grown and is doing well. he now has 300 full-time and part-time employees. music instruments and

performance space and listens to musicians -- i am doing quite a bit of advertising for you today. i am glad that you are here to tell your story on behalf of many of the small business owners in the country. thank you, mr. chairman. >> our next witness is dr. patrick burns. he is the chairman of overstock.com that has been publically traded since 2002. overstock takes orders over th ninternet and relies on common carriers to deliver merchandise. in 2010 they reported 1.2 billion dollars in revenue.

he received a doctorate from stanford university. our next witness will be introduced by the gentleman from indiana -- i am sorry. the next witness will be introduced by the gentleman from texas. >> thank you. our next witness is my friend, john otto. he was elected to the house of representatives in 2004. he is from dayton, texas. this is important. dayton, texas has a population of 5000. they have a high school football stadium that seats 70,000 and is always full on friday nights. by trade, john otto is a cpa. he has served as vice chairman of the house committees on ways

and means. in 2008 he was chosen on the house committee on appraisal reform. in 2005 he was named republican freshman of the year in the house of representatives and texas monthly has named him one of the tent as legislators in texas. he is a graduate of texas a&m and a dba from that university. and your honor, i have warned orange today to celebrate last week's thanksgiving day game. -- where texas one. i yield back. >> our next witness is tod cohen from ebay. 2006 he became responsible for ebay's intellectual property work as well as law enforcement

affairs and global investigation teams. he received his b.a. from the university of utah in 1985 it his treaty -- j.t. from george washington law school in 1992. he worked as a congressional aide for four years. founded in 1995, ebay's website facilitates private transactions between private buyers and sellers. it boasts about 100 million users worldwide. many are small business owners that may take a virtual storefront on the ebay platform. in 2010, the total volume of goods sold was $62 billion. the next witness will be introduced by its intimate from indiana.

i am privileged to be here. luke kenley is a five term indiana senator. he has provided exceptional leadership on fiscal responsibility and pro-growth policies in indiana throughout his career. he is chairman of the senate committee on appropriations. i hasten to add, since we are doing a little bit of trash talk between states, indiana has found a way even in these difficult times to balance our budgets without raising taxes. senator kenley has been a driving force in making indian at the fiscal and the of the nation. his career spans several decades.

after completing his undergraduate degree at the university of miami in ohio in two years of law school at harvard university, he enrolled in officer's candid school in the u.s. army and graduated. return to harvard to complete his law degree and return to the hoosier state. senator can lead comes before us today on behalf of the streamlined sales tax governing board in his capacity as president of that organization. the streamlined sales-tax the voting board has been an advocate for fair, and sells taxes. i am confident his experience in this area and his testimony today will be of great benefit to the committee as we work toward an equitable and a common-sense solution for all parties concerned. thank you, mr. chairman, for the courtesy of allowing me to introduce this esteemed fellow

who is your senator, luke kenley from indiann. >> are final with this is paul misener from amazon.lcom. he has an engineering degree from princeton. at amazon, he is responsible for formulating and presenting the company's positions worldwide as well as managing policy specialist in asia, europe, and the north america. according to amazons website, during the first 30 days of business, demos on.com to fill orders in 50 states and in 45 countries all shipped from his home garage near seattle. today amazon is one of the largest e-talors.

appreciate the witnesses who were here today and mr. marshall, we will begin with you. >> mature your mike is on there. is or might on? >> thank you. good morning. my name is dan marsahll and i represent marshall music company. i am also here to speak on behalf of the michigan retailers association. totaling roughly 4800 individual businesses. i am here to speak on behalf of

mistreat retailers in connection the with what we see as an unlevel playing field relating to all of us as retailers being required to collect sales tax and having customers every day and every hour that we operate coming in and price shopping and comparing our price with internet retailers that do not collect the michigan's sales tax. marshall music was started in 1948 by my mother and father. i in the second generation family leadership of the business. we have seven locations throughout the state of michigan. will provide sales and service for musical instruments and accessories, repair, lessons, and a call on music educators throughout the state of michigan and the rent and sell

orchestra instruments to beginning is a participant. i cannot begin to tell you what it challenges retailing in a state like michigan have presented to martial music. myself and other mainstream retailers have adjusted to the economic realities of a fiercely competitive environment present. we are perfectly comfortable with that. in the absence of competition, i suppose we would all become complacent. that is certainly not the case with marshall music and my fellow retailers. the size of small business i think is something that somehow gets lost in the shuffle sometimes. michigan retailers -- 4800

members, a council membership -- the casual measurement. in many cases it is a husband and a white, may be a part-time employee. ministry retailing is not a big numbers game. every strip mall and shopping center and a downtown shopping district is complete with retailers just like my family who every day employ significant numbers of people for services and support. illustrative of that would be today in michigan, we got eight inches of snow overnight. there is a small business snow removal companies removing snow from all of our parking lots and helping us get our doors open for business today. we have been selling on the internet through ebay for some

time now. internet retailing is just a wonderful opportunity for small business people. it allows us to not necessarily just sell everything we have in the inventory -- in many cases, we are just not prepared or capable providing the support and fulfillment and having the computer systems to be effectively represent our entire product on the internet's. in virtually every instance, there are some products or some area of expertise whether it is oddball, obsolete or used merchandise to promote that on the world wide web to a much larger market, it is very beneficial. in our case that is exactly what we do. the product we have had in inventory for too long that is

used or you need, we will put it on the internet and find a buyer in a larger market in our area markets. i understand and accept that we have to be competitive, and we are. we price match every day. we price our products according to what the marketplace dictate. to have that additional 6% sales tax differential is something that just creates an unlevel playing field and does not make sense to me or other retailers. why in michigan resident has to pay tax that has a its presence in michigan or as if they do business with somebody who is not employing people were supporting the michigan employment -- economy, they do not have to -- the retailer does

not have to collect sales tax. as far as requiring us to collect sales tax, i see that as an entirely due will endeavor. if people perceive a need, people are going to flock to fill that need it. the resources that are available today make collection of the sales tax possible. i am sure it will only get easier and more streamlined if in fact he provide states like michigan enabling legislation to allow us to have all internet retailers collect tax. >> thank you. >> good morning, and chairman smith and members of the committee. i am the chairman and ceo of overstock.com.

thank you for the opportunity. my basic view is that brick and mortar has become a 87% -- a big box has become a 87% of brick and mortar they are trying to pull up the drawbridge after that. they are trying to get a law passed that will suppress competition from small remote sellers and internet sellers in general. for that reason, overstocked supports the current law. it is facilitated to the advent of a vibrant advent ofoverstock, ebay, and amazon. we oppose the bills now in congress that would empower states to have local retailers themselves tax collectors and have such remote sales obligations existed when we launched in 1999, we would not be here today. in 1999, we had 18 employees and

had 90 products. if we had to administer and collect sales tax without compensation, our chances of becoming an employee -- employer of 1500 americans that we are today would be small. too high of a hurdle would have been established by the cost of compliance, the unavailability of affordable off the shelf software solutions, the cost of employing people to implement and manage the software, the resolution of state audits and resulting assessments, and the rest of penalties and a lawsuit by attorneys for software errors and commissions. the question the committee must consider is whether it will continue if congress alter's current law by allowing states to burden interstate commerce. in my opinion, the pending bills allow states to shirk their responsibilities to collect taxes they get on

consumers. the force that burden onto don resident, non-voting citizens. it would poison the internet fertile ground for new and innovative e-commerce firms. more specifically, we opposed the pending bills because we believe jurisdictions should be responsible for collecting taxes from residents and should not unilaterally outsource to retailers without compensation the burden of collecting taxes from residents of states for those retailers have no presence. the absence of any nexus threshold makes remote sales tax collection a burden on commerce. however, if a majority in congress is determined to replace current law,overstock believes a fair legislative solution must include three elements. because tax collection is a function of states, the states should be required to provide a

plug and play software solution. supporters of the bill clams solutions are readily available in the marketplace. the fact is, they are not. we have been considering a warehouse in kentucky. in preparation we acquired what was a plug and play software package that would insure we were in compliance with tax collection obligations for sales for kentucky residence. the reality is the off the shelf software requires $300,000 of investment and months of an hour's to build. it would be extraordinarily costly for companies like mine, not to mention companies with fewer resources. if states want to collect tax on our sales we have no presence there, they should supply software that makes it possible to do so. they tell you this exists, but it is vaporware.

it should not be liable to state lawsuits if it ever is to arise from use of such software like missing a tax holiday, the fact that one city in the state taxes a cell of a product way while another exempted from taxation. third, taxing authority should compensate all retailers after it implicates suffer and collect sales tax on their behalf. it is expensive to implement software and to collect tax to the jurisdiction. states should not be permitted to compel companies to do their work without reimbursement and without some degree of revenue sharing. i have attached my written testimony draft bill incorporating these principles. i believe it will garner support from the majority of e-commerce companies as well as a brick and mortar retailers, particularly smaller and midsize mystery retailers who would be heard by the pending bills. thank you for the opportunity to

share my views. >> thank you. mr. otto. >> since 1992, the "decision has been did love the land and physical whether or not the retailer has to collect sales tax. over the last 19 years, technology has advanced to the marketplace to the point that a physical presence can largely be controlled and isolated to a few states while selling in many states. if you doubt that, you have two online retailers i would be curious to know how many states the selling to verses hominy they are claiming a physical presence and collecting taxes in. if action is not taken and it is allowed to remain the law of the land, are we not picking winners and losers within the retail sector? in my opinion, at levels the

playing field wall protecting state rights. that is very important on the protection of state rights. previous legislation that has been introduced in congress pretends that it needs to -- while i fully support the rights of states to join the compact, i do not believe the state should be forced into jordan the compact in order to receive the benefit of such legislation. h.r. 3179 leaves it up to each state whether they wish to join the compact or not. let me also point out that in my opinion, the streamlined states will comply with the requirements of h.r. 3179 as soon as they adopt a small- business exemption. they are at a distinct disadvantage to how quickly they could implement a chart 3179. let me address briefly why i think this best serves the interest of states. it requires a small-business

exemption. it requires a uniform tax base role within a state -- what is and what is not taxable. it requires centralized filing within a state. it also offers options on the tax rate. it can be a state only rates. if you cannot get your local jurisdictions to comply with the other three requirements, the state could implement a state only rate. it also has a blended rate possibility as well as an address based rate with software made available to the retail sector. in my opinion, it is desirable. it may cause delays in implementing the provisions of h.r. 3179 in some states. this is going to be the biggest issue if legislation is passed is how can state to implement this. and over what time. in texas we do not meet again until 2013.

it will take several legislative sessions to get to a uniform tax base if we want to go down to collecting the local tax jurisdictions as well. therefore, i believe the flexibility that is provided in h.r. 3179 best serves the interests of the states and allowing us to level the playing field. i do not fault anybody who has taken advantage of quill. they fall within the law. the problem those are the kind of businesses that support the local community. they have a physical presence there. they contribute to the little league in the pta. they employ my local citizens. that is why it is most important

to me that a bill that would follow the guidelines as set out that if congress is going to take action, this is by far, in my opinion, the best legislation i have seen proposed to assist the states and addressing this issue. thank you. >> mr. cohen. >> my name is todd cohen and i am the vice president of global government relations of ebay. ebay empowers and connects millions of buyers and sellers across the globe. e base priority on remote sales tax policies has always been the treatment of small business retailers. hundreds of thousands of small businesses across america use ebay to engage in commerce. it creates jobs, foster's competitions, and promotes innovation. the internet and mobile

technology has clearly a part of every retail business model going forward. this is true for small, med, and giant retailers. small business retailers have used the internet to survive and grow outside their traditional market. the remote sales tax debate is decades old. while the pro attack rhetoric largely states the same, the world of retail has changed around it. the idea that this debate is about the internet versus offline stores is a false paradigm. all retail business models, large and small, used the internet. they also involve physical facilities like stores, warehouses, management offices, or distribution centers. attorneys to be comfortable using is brick and click retail. -- a term you should be comfortable using is a brick and click retail. large retail stores and america operate brick and click businesses. to get some perspective, 93% of retail goes on in stores wall 7%

is exclusively on line. almost 45% of in-store sales are web enabled and that is exploding. big and small retailers offer consumers different benefits on different scales. their models, a different cost. giant billion dollar retailers with national store distribution networks offer services like same-day delivery, lower-cost shipping, and in- store returns of items bought online. being giant creates an economy of scale that has advantages. the largest retailers on the internet, including bricks and clicks, are growing their market share. national brick include retailers are 18 of the 25 top retail website. amazons version of a brick and click is based on its distribution centers. small-business retailers are losing market share even under the sales tax status quo. as has been the case for decades, the fundamental threat to small independent retailers is coming from billion dollar

competitors, not other small- business is. you hear a lot about fairness in this debate, as of sameness is equal to fairness. it is not. different sized businesses face very different conditions and different rules. retail, small businesses on the internet face higher shipping costs, higher product costs, and difficulties dealing with returns. retail competition is about more than remote sales tax. the benefits of local presence comes with a local tax cost. honestly, that is fair. if sales tax laws change without protecting small businesses, consumers will face -- the consumer will not gain any retell benefit by its physical presence. without a small-business exemption, remote sales taxes will to the scales further against small-business retailers and benefit the largest retailers that have most facilities. that is why retailers with

national stores or distribution network support changing the current law. current law regarding remote sales tax authority is not perfect. a few large retailers, amazon for example, have not operated in the spirit of the law and link sales tax collection to physical presence. some states have used tax related incentives to encourage large retailers -- investments without offering similar investment incentive to small businesses to fulfill their in state tax obligations. that is not fair. congress has the power to redress inequities among a few giant retailers without putting a new tax barrier in front of small business retailers. a real small business attention and a federal law reversing the decision would meet that law. there will always be small business retailers that want to protect and grow. it is where tomorrow's big retailers come from. protecting all businesses from regulatory and tax burdens is not a new concept. this is a traditional bipartisan legislative goal. house resolution 95 is in that

spirit. as a champion small business retailers with their resolution. it retains an aspect of current law that works. ebay stands going to work with the committee to ensure that any changes in remote sales tax law includes meaningful small business protections and creates an opening for small ree -- small retailers to grow into the next billion dollar businesses. i appreciate the opportunity to testify before the committee and look forward to your questions. >> thank you for the invitation to talk to you today. i chair the senate appropriations committee in indiana and i am a longtime retailer. i come before you today in my role as someone responsible for producing a balanced state budget, which we do every year in indiana, for developing a fair and sensible tax policy to support that budget, and as president of streamlined sales tax governing board, the country's most successful

business tax simplification initiative, with 24 fully qualified member states, and i might add, interestingly, about three-fourths of the legislators on the board are republicans because this is such a pro business activity. as a law student at harvard when i studied the case, i never imagined i would be testifying before congress about the court's interpretation of the constitution's limits on state sales taxes. the development of the internet and e commerce, but wonderful development for consumers, serious issues will state budgets and retailers have come to the fore. the government and a price disadvantage through no fault of their own. the u.s. supreme court made it clear that a state's ability to employ an effective sales predicts sales tax would defend it depends on the authority granted by congress. i come before you today to ask you to exercise that authority.

several other cases, it is clear that voluntary agreement among states are constitutional exercises of state authority. according to the department of commerce, the commerce sales in 2005 for $87 billion. this year that will total more than $175 billion, more than twice that amount. the quarterly sales of e commerce have increased on average 17% above last year's figures. sales on cyber monday two days ago increased 22% over last year. retailers across the country often by themselves acting as the display case for consumers to come in, try out the product, solicit information, and product comparisons from the local retailer, then go home and buy it on line. in fact, the amazing power of mobile phones allows them to scan product codes, check prices, and byproduct from on- line business before they even

leave the local store. today, a technology with the tremendous advances made in recent years makes tax collection simple, cheap, and reliable. it streamlines the uniformity of definitions enhances the needs of collection. we provide free software for companies and our certified service provider system will provide for free to small internet retailer collection and remission services. in many ways, the internet is the perfect environment in which to collect sales tax. it is something that can be automated. any small-business exemption for small internet retailers were further discriminates against the local small brick and mortar businesses who do not receive the exemption. with the free collection service offered by streamlined, the receipt burden is removed. the only burden is the price disadvantage placed on local retailers. is this a tax increase?

the paying a tax you previously but have not been paying is not a tax increase. if he refused to pay a tax already owed, for example federal income tax, that would be attacked the creeps. none of us elected officials who have sworn to uphold -- that would be a tax increase. we are not likely to run a campaign on the platform of don't pay your taxes and get a tax increase. asking one retailer to collect without asking the same of all retailers does not seem like equal protection under the law. some say we should use other ways to collect the tax. this feels like overzealous enforcement, practices would seem to invade the consumers' privacy, and fails to adhere to our standard believe that most people file their returns with integrity, and we trust them to do so. three bills have been filed on

this subject. there are some differences among the bills that affect businesses in very different ways. the original bill is the most business really in terms of simplicity and uniformly. that bill was not offering alternatives to non streamlined states, which streamlined agree should be available to other states. we agree on that point with mr. otto. but progress has already been made. the differences reflected in the bills or about the only serious issues left to resolve. those issues are clearly identified. i come before you today as a state legislator who develops budget and tax policy as a retailer seeking a level playing field that to ask you to exercise your authority under the commerce clause and braque states the ability to solve these problems. -- grant states the ability to solve these problems. >> thank you for inviting me

testify. amazon has long supported federal approach to sales tax collection. we have participated in the cells tech project for over a decade. amazon strongly supports enactment of a federal bill with the brokerage provisions. congress should authorize states to require collection. the great of it to protecting state rights addressing state needs in leveling the playing field for all sellers. congress should protect the state rights and authorize them to require a collection of sales tax revenue already own. doing so would not violate pledges limited to questions of income tax rates and deductions. congress should help address the state budget shortfalls without spending federal funds by authorizing states to require collection of the billions of revenue dollars already owed. congress should not exempt too many sellers from collection, for the sellers will attain a lasting a level playing field versus main street and other retailers.

congress can authorize the states to require collection. with today's technology, widespread collection no longer would be an unconstitutional burden on interstate commerce and congress can authorize the states to require all but the smallest buyers and sellers to collect. much attention has been paid to the size of the small cellar exception thresholds and federal legislation, and rightfully so. it would exempt some sellers from -- it must be kept low to attain the objectives of predestine -- protecting state rights and creating fairness among sellers. in this context, several kinds of small white and sellers must be considered. for most of the main street small -- small sellers must be considered. small volume online sellers have received most of the attention, and not without reason. no one wants them to shell --

shoulder a local burdens -- no one should want these online sellers to take event of a newly created on a level playing field over small main street businesses, and no one should want government to pick business model winners and losers this way. the consequences of a threshold level to stage rights and needs and fairness are very significant. a surprisingly large fraction of e commerce is conducted by small volume sellers. nearly 30% to sellers in online sales below one it is below $150,000. on 1% -- 01% sell below this amount. the $150,000 exception would deny the state's nearly 30% of the newly available yet already owed revenue but would exempt 99% of online sellers. today's computing and

communications technology well- off online sellers to collect and remit tax like main street cellars. service providers make the technology available to medium as small white and sellers. -- small and medium main street sellers. amazon and ebay come to mind. both use technology to serve their customers. while amazon is prepared to make the technology available to help sellers by collecting tax for them, ebay seeks to avoid any role in collection, claiming that small volume sellers -- these claims are made despite the fact that ebay manages to collect the transaction fees it charges its sellers and despite the fact that ebay already calculates state sales tax for

ebay sellers of laydown to the local jurisdiction level. amazon and any other service providers will help smaller sellers, and surely ebay can as well. congress may, should, and can attain the objectives of protecting state rights, addressing the needs of states without federal spending, and leveling the playing field for all sellers, but only if any small cellar exception is kept low. amazon is grateful for this hearing. we look forward to working with you and your colleagues to pass appropriate legislation as soon as possible. >> let me recognize myself for questions and let me address my first question to mr. byrne and mr. cohen. states already have the authority to collect sales tax from remote sellers, why shouldn't they also have the means to collect sales taxes from the remote sellers?

>> mr. chairman, the quill decision establishes that it would be -- that states can go up to a certain line and no further. that line is drawn by the supreme court. >> but congress could change in that line and the supreme court almost invited us to. >> no question that they have the power to. >> if states can collect it, why shouldn't they have the means to collect it? if they have the authority to collect the sales tax from remote sellers, why shouldn't they also be given the means to do so? >> the u.s. congress has the authority to empower the states to, but they shouldn't, because at this point, what it is really going to be about is amazon and

the big box retailers having a way to -- it is very burdensome and it will be for companies on line to establish databases or plug into databases and charger brokerage taxes on every kind of product in 10,000 jurisdictions. in some jurisdictions -- some is taxes on candy, or food and gift basket. it will be extraordinarily complex for us to implement. >> the chairman, we agree that not only do you have the powers but the means should be provided to the states. it is just a question of small business protection that we believe is where the issue lies, not whether the states should be given the right and the means to collect. >> ms. misener, which of the

three bills under consideration would you support? >> there have been free breakthroughs this year. the first was when mr. connors and his colleagues sent up the bill in july which gave to the governing board the right to decide the correct threshold for a small selling exception. the next breakthrough was the bill that recognize that not all states would be able to make the changes required by streamlined. the third character was the senate bill introduced a few weeks ago. >> do you support any of those breakthroughs? >> yes, sir, all three. we believe it is a subject for discussion here today. >> if we were to enable states to collect a sales tax from remote sellers, wouldn't that increase the cost of merchandise

to consumers? if so, is that justified or not justified, mr. marshall? >> i certainly cannot speak as an expert on that topic, but my understanding is that sales tax or use tax is owed by michigan residents on all their purchases, so it is cannot a new tax, it is simply leveling the playing field as to who is required to collect it and voluntarily disclose it in their tax return. >> that was my point, you had the in party and they can impose the taxes, just right now, most aids do not actually collected. mr. otto. >> i would agree with what he says. here is one interesting point, though. if you or a business annual sales tax permit in the state of texas, you go through on it, you are going to be found if you have not remitted use tact she should have. in texas, we have no way for a

household to remit use tax. there is no state income tax. there is no form or anybody to remit the use tax. >> you are saying the taxes are owed any way, they might as well be collected. >> my perspective is that the only disparity in the competitive world of have today in this arena is the sales tax being imposed on some retailers and not on others. i think if you eliminate that and level the playing field, you are going to see more competition. i don't think the consumer is necessarily going to suffer in that situation. >> the gentleman from michigan, mr. conyers is recognized for his question. >> i want to thank the witnesses for their individual contributions to this subject.

now that we have established that will give us the authority -- quill gives us the authority, we are encouraged to take some action in this. the question really is, how do we do it as fairly as we can? ironically, as our witness mr. marshall has pointed out, there attacks on internet transactions, but nobody is

paying any attention. am i correct that michigan is in that posture, mr. marshall? >> yes, you are. we are required to report our internet purchases and remit a use tax on that, but there is just the way for the state of michigan to know what transactions or occurring. >> i wonder how many other states are like that. does anybody know how many states might be in the same position that the state of michigan is in? namely that there is a tax already existing, and by the way, there is a 6% sales tax in michigan. there should be an internet tax

, and it is being ignored. couldn't someone argue, mr. marshall, that we don't need to do anything, just if everyone followed the law, we would be better off. what do you say to that? >> i just think election ought to be uniform. if some retailers are retired -- required to collect, that all retailers should be required to collect. it is just the unfairness of some of us being required by law to collect sales tax and other retailers that are selling product in our state are not. and's suppose we pass a law everybody did what michigan does, ignore it. what would you say to that? >> mr. conyers, the current lot in the 45 states that have sales tax plus the district of

columbia is there is a current use tax obligation for a purchaser who does not pay the sales tax when they purchase the item. some states like texas don't have a way in which they could be revisited. other states like california have a line on the income taxes for use tax collection. it is done. it is the lot. it is very difficult, and i do respect the tax collection efforts by many states that it is very hard to do and it will cost a significant amount of money to do that. therefore, it does seem to make a lot more sense that on large retailers, you impose a burden that they collect and remit sales tax. that is in 45 states. >> so you support my legislation? >> as currently written, we do not support the legislation. the lack of a sufficiently high

small business exception. >> so that is your main reservation about. >> yes, sir. >> let me ask you this. is it fair for some witnesses -- some businesses that have a sales tax advantage by not having to collect sales tax, which is why you are for this bill if we could get that small business exception straightened out? >> yes, sir. jeff bezon from 1996. the mail-order business you have to charge sales tax to customers who live in any state where you have a business presence. the bay area it is that single area for technical talent, but it did not pass the small state tax. there is the advantage he chose for his company place in washington state to take a band

of the distance state sales tax exclusion. >> thank you very much. >> i think we have to recognize something here that that choice was made under current law. what we are proposing today is to change the current law. congress has this authority very clearly. let's recall that ebay has facilities in 20 states around the country. it is not an isolated business, as they would suggest. they also are a multibillion- dollar company. doing something to carve out ebay from collection will have significant ramifications to the state in for fairness. >> can i ask my friend here if he has any rebuttal comments to that statement? >> if ebay was a retailer, of course ebay would have an

obligation to collect and remit sales tax in those states. but each day is not a retailer. it is a marketplace in which people offer items for sale and are the sellers, and the sellers have the obligation. wanted that this -- one of the things we are quite proud of it is that our sellers who are in one of the 45 states and district of columbia and collect and remit sales tax. for his sales and the state of michigan online. >> could i get a rebuttal to the rebuttal, please? >> the gentleman from michigan is recognized for an additional minute. >> thank you very much. amazon also has a platform for sellers. we have over 2 million sellers to sell through our sides. we will make the service of tax collection and remittance available to over sellers. we only ask that the they do the same.

>> mr. otto, this committee recently passed the tax simplification act which confirmed a physical presence standard for collection of taxes. would your bill apply just for the sales tax or would it reach into other business taxes as well? >> it is maya understanding that all we are dealing with here is sales and use tax. >> what do you believe is an appropriate small cellar exemption threshold? you are asking me to get into a battle i am not sure i am willing to get into. [laughter] i am only familiar with my state. you are talking about a bill

that is going to affect 45 states and the district of columbia. that is something i understand from the testimony that has been given here today, that is going to be an important issue. i don't have a preconceived idea. i cannot pick a number of the air and say this should be the small-business exemption. it will require some study on this committee's part. i do support the small-business exemption. it is just in defining what is small business. >> i am getting involved in some here say evidence here. last week a constituent of mine told me that he heard on the radio and and for blinds.com. the gist of it was to buy from blind spot, because there is no sales tax in most aids. is it true that there is no sales tax in most -- no sales

tax in most states. would you agree it could present a competitive edge over the brick and mortar sellers? >> would collect -- our rigell business has a physical presence. what we are seeking today's congressional legislation that would authorize the states to require all out-of-state sellers including amazon and blind spot, to collect, regardless of whether their business has a physical presence in the state -- blinds.com. >> brick and mortar retailers characterize the market place equity act as restoring fairness to the retail industry. how do you respond to that? >> i would say that it cuts both

ways. rick and mortar also has the advantage over us. -- over indirect -- over internet companies. they get to interact directly. they get to hand over the goods immediately. customers can return them right there. there are advantages and disadvantages. they cut both ways. we would not come and say congress has to do something new york -- in order to level the playing field on brick and mortars to take away those advantages. >> advocates of sales tax reform legislation insist that technology can easily calculate and collect sales tax at the destination rate. if this be the case, what would be the burden on ebay's small business customers is such technology were made available to them?

>> we have been very clear for at least 11 years i have been working with the company that this is not a technologically difficult thing to do. it is burdensome. it is a morass of many state laws with different taxing jurisdictions. that does not make it impossible for people to collect and remit. our basic point of view is that it would be much more fair if all small businesses were to receive the same fairness that a large retailer were to get, lower shipping costs, economies of scale. this is a place in which tax policies can be used to make sure the small businesses have an opportunity to participate in the global marketplace. >> how have states affiliate's statues affected your business, and how does amazon use

affiliate's? what toll has the ensuing litigation had on your operation? s are small websites that place links on their sites to a variety of retailers, including amazon, and when a consumer plan predicts on that and ends up buying something at the retailer, the website get the commission. it is a great advertising and business model. has been -- there have been counterproductive bills enacted around the country where states have tried to describe those advertising activities as giving an out-of-state retailers -- we rejected, but we have stopped advertising. it is unfortunate. we wish we could get those advertisers back. in north carolina, we would love to be able to welcome back our amazon.com associates.

>> the gentleman from virginia, mr. scott, is recognized. >> i does want to ask mr. eisner -- mr. meissner represents amazon, you are one of the big guys, yet you are supporting a fair tax, a balanced tax with the little guys like marshall. is there some explanation for your extraordinary, good moral bearing that you bring to this hearing today? >> personally, and it is worthy of question with me. we have long supported federal legislation. we made this decision right after i joined the company a dozen years ago. at the time we faced the choice. could we draft of the internet

tax freedom act moratorium and somehow claim that the internet deserved a privilege, not tax position. we have never taken that position. the three break through some mention this year, starting with your bill in july, really i think are breaking the logjam. we are the point of recognizing the fruits of our labor all these years. >> let the record show that there are corporate good guys in this world. >> if somebody in washington d.c. builds -- goes to a brick and mortar store in virginia and buys things, do they pay the virginia sales tax? >> if they go to the virginia store, they do. the basis of the tax is on the destination. in other words, where the transaction takes place. and if the virginia store

delivered it in washington d.c., a washing machine, for example, who would pay the taxes? >> we spent a lot of hours are doing those points and streamlined, and in some cases it would be in washington d.c., where the sale takes place. but the sale takes place in virginia and they deliver the washing machine to the residence in d.c. >> if they deliver it, it is taxable in washington d.c. >> are you aware -- is there any small-business exemption to the local sales tax? >> no, i don't think there is in any of the state. everybody is on a level playing field there. >> if the tax is due but not collected by the business, d have an estimate of how often it is actually collected?

>> you mean how often is paid for the use tax system? in endeavour -- in indiana we have less than 1% of filers to actually fill out a use tax return. >> if the business were to actually collect the taxes, what would they do with the money? how would they get to the various states and localities? >> first off, the small business can use a certified service provider. we actually have one small business in you -- in new hampshire with less than 50,000 hours of sales was signed up for this in 18 minutes. they are not charged anything to be a participant. the retailer collect the tax when they build a customer and then turn it over to the service provider. they fill out all the returns necessary in the 45 states that

have sales tax, and remit it abruptly -- appropriately. >> who pays for that service? >> the state pays for it and then the certified service providers take the amount of compensation that streamlined offers in addition to the regular compensation package. >> is that service actually available to everybody now? >> yes. we have six certified service providers who can do this. many of the larger companies have chosen to implement their own system. amazon has developed a system where they are a certified service provider on the platform. >> does that include some locale -- some localities have a local sales tax. >> it includes all those jurisdictions with local sales tax as well. no problem. >> you have some software to

tell them how much to charge? >> no charge on the software. >> the software tells them how much to charge, they collected, then they send in the aggregate amount and some service will distribute the money at no cost? >> that is right. >> thank you, mr. scott. the gentleman from indiana is recognized. >> thank you, chairman. thanks for holding this hearing. i am grateful for the testimony of all the participants. i want to appreciate mr. misene r with amazon. we appreciate the tone and tenor of your testimony and your remarks today. i wanted knowledge mr. byrne,

who i have had the pleasure to meet, because of his association with education reform. this is a distinguished panel, to say the least. i find this discussion enormously helpful, mr. chairman. it is clear that since the advent of the commerce clause itself, that under our form of government, the congress has essentially granted exclusive power to regulate interstate commerce at the national level. i have long opposed taxing the internet.

i greatly associate myself with comments that were made about extraordinary innovation that has occurred in the commerce in this country. i believe it represents bold work of american prosperity in the last 20 years. i believe that moratorium on internet taxation has been prudent. i have strongly supported it. it does strike me that as this marketplace has matured, there is an argument as has been made eloquently by several on the panel for us to consider letting states decide, but it strikes me that we ought to follow a couple of basic principles. number one is no new taxes. my colleague from texas and i

share a particular view of taxes. maybe i am presuming, but we ought to make sure there is no new taxes on the people of the several states. secondly, i do acknowledge that there ought to be no undue burden on commerce. i am also very interested in what would be the recommendation of members of the panel about the proper small-business exemption. i think the two large principles here for me, i don't think congress should be in the business of picking winners and losers. inaction by congress today results in a system that does pick winners and losers. i am a very strong advocate of federalism, as you are, mr.

chairman. it is my judgment that having congress continue to stand in the way of letting states decide if we can meet these other criteria is worthy of our deliberations here, as we preserve and promote and seek to invigorate the principles and practice of federalism across this country. we just heard about a blinds.com radio ad. we have all heard ads like this, saying in most states, no sales tax. there is no sales tax on internet sales. in a point of fact, is it that there is no sales tax on

internet sales, or is it simply that states do not have the authority to collect taxes that are owed? in our very first conversation, i believe someone who owes taxes pays taxes. what is the situation in america today? is there no sales tax on internet sales, or is there in fact a sales tax, it is just simply that indiana and other states do not have the ability and capacity to collected under the law? >> thank you for the question. first of all, i would say that this is not a tax on the internet. this is a tax on the consumer who is going to receive the government services that are provided in whatever state that is. as your question about whether not -- whether or not there is a

tax or the taxes collected, we have noticeably been unable to collect the tax other than by having the retailer remit. that is why we have gone to these great lengths to make it cost-effective or cost free, particularly for small retailers, to be able to have a collection and remission process. if we did not do this, i am afraid we would end up like greece and nobody would pay their taxes. we do not want to go there. it has just been a difficult proposition to work out. once you start down other past of trying to find ways to collect that use tax which is already "q&a" 0, then you get into saying that you are trying to get information -- which is already due and owed. all we -- are using the heavy hand of government and the tax collector to beat on people

unduly? the sales tax system, which has historically been that the retailer collect and remit the tax, that is a historical precedent, and we can make it work in the system due to the advances in technology, even since the internet age of commerce start a. >> but the tax is owed. >> it is 0 in all 45 states. they all have the same situation in that regard. >> congress, and jack e. spier is a sponsor of the marketplace equity act and has just come into the room. >> thank you for this useful and interesting panel.

i did not have the chance to introduce mr. cohen, but ebay is actually headquartered in san jose, so welcome santa fe based -- san jose based ebay. we want to stand with the little guys, because small businesses or the engines of the american economy. they are the ones creating the jobs. the difficulty is, who is standing up for the little guys? the question i have for you is, i know ebay is an entity, but you don't sell stuff. it is a platform, and people are selling. when i go on ebay, it looks like this, mainly small guys. when i go on amazon, which i do a lot, and thank you for having your service.

sometimes it is small guys, especially for specialty books, but it is mainly retailers that you get for your site. what percentage of ebay users are what you consider small business, and how would you define that? then i would like to ask the same question of the amazon witness. >> for many of our sellers, ebay is only one channel that they use. whatever statistics we know of their use of our platform, mr. marshall has only -- has a significant part of his business in the state of michigan. what we believe is important is how you define what these type -- the size of a small business should be to take advantage of an exception. we have recommended and endorsed

bills that have included the small business administration's determination of what is an electronics retailer. the number is reset annually to determine what is the appropriate size. last year it was approximately $30 million. >> that sounds like a lot, but that is gross, correct? if you had that kind of gross sales, what would that really net you as a business, ordinarily? >> in the state of texas where they don't have personal income tax, you may make a lot more money than in the state of california or another state. our general impression is that most of those sellers, even up to $30 million in sales, have a very tiny margin. what they are making from that is significantly less than what they are large retail

competitors can be. one example, our estimate is in that $30 million number, we believe that would be the amount of sales on amazon since the beginning of this hearing today. >> on the small business administration number, we need to debunk that right from the start. it has absolutely nothing to do with the conversation today, which is about the burden on small businesses for collecting sales clack. -- collecting sales tax. mr. cohen's company has told wall street that they have something like over 25 million sellers. that is the world wide number. that is probably about 10 million domestically. we have analyzed it as just over 5 million sellers.

only 1% of those sellers sell more than $150,000. >> what is the percentage of your cellars are small businesses as compared to larger retailers? >> our retail business is still the bulk of sales at amazon.com. >> in terms of dollar amounts, the booksellers are not doing big volumes. >> we have not released that amount in our filings, but just for scaling it, it is important to recognize that sales through ebay still exceed the deals by amazon retail and the number of small sellers is many times -- in my >> that doesn't tell us anything. they ask you this. we did not have an exemption for

small businesses, what would the impact be? you have small businesses all over the united states, people actually supporting themselves in these tough economic times by helping to sell stuff, including mr. marshall. what would the impact be, do you think, on most small businesses across the country. >> without robust small-business exemption, you put a limit on the size and impose a cost immediately on those people. we think the cost on the economy would be fairly significant. there is an enormous amount of income generated by the ebay platform, by the use of bad words through google, for many different small businesses -- by the use of adwords. our estimate is that there would be significant job losses with those small-business exemptions.

>> my time is up, mr. chairman. i thank you, and thanks for the -- thanks to the panel. >> the gentleman from utah is recognized for five minutes. >> does everybody agree there should be some exemption for small business, or is anybody advocating we should actually get them to be at 0? >> the streamlined organization in their plan has a $500,000 small-business exemption. the king for myself as a retailer, -- speaking for myself, i think there should be no small cellar exemption. i say that because the minute you give a small cellar exemption to the internet retailer, you are then discriminating against the small cellar of the bricks and mortar type. >> in my mind, one of the big

questions is, what should be that threshold by which small business -- what is a small business, or what threshold should it be? i would like to start with mr. byrne. let's talk about the difference in the modeling and how it affects what you are doing, what ebay and amazon are doing, and what are the advantages and disadvantages. we are really trying to empower small businesses in this country. it is a terrible burden when you are trying to supplement your income. can you go little bit deeper into that, please? cracks in the bill we propose, the small-business exemption is up to $20 billion -- $20 million. that may be the highest of any proposed cap. as far as the models, what is going on is this. if we open a warehouse in indiana, we interpret the law to be that we have to pay tax in

indiana. amazon has taken a much more aggressive tax position historically. when they open a new warehouse in a state, they put in a subsidiary. they have been doing that from the beginning. our tax accounts would never let you try something so aggressive. the ground is dissolving under their feet on that position. so now they are jumping on this, which is really giving the sleeves out of their best. amazon is turning into a big retailer. >> how many distribution centers do you have across the country? >> a couple dozen. >> do you pay taxes on those? >> it is not a tax on amazon that we are talking about. it is a collection responsibility.

>> you have taken a fairly aggressive tax position saying we have no physical presence, but it is under your control, is it not? >> it is a separate corporation. >> you see my point. that ground is eroding from beneath their feet, said they are looking more and more like a big box, and therefore they are jumping on. it is the sleeves out of the best. all this tax reform is sleeves vest for tax reform. >> ebay is so pervasive

everywhere. we are talking about the exemption threshold. where you see that line? i think it should be higher rather than lower. what number do you like, and what is your perspective on it? >> we do support the small business administration's calculation of the size of small businesses. we are also open to discussion that makes it relevant to trying to determine what the appropriate level is. our general viewpoint is that if it qualifies to tame -- obtain loans or qualifies the small business -- it makes a lot more sense than handing the power over to the tax collector, who has an interest in trying to maximize every single possible dollar and does not have any interest whatsoever in determining how to create more jobs. >> what is that threshold number? >> it is approximately $31 million right now.

>> the chair recognizes the gentleman from texas for five minutes. >> -- the gentleman from texas for five minutes. >> let me thank the number of members who have an initiative including all of my friends and the ranking member mr. conyers. it generates or speaks to the emerging reconsideration of where we are today in 2011 as where we might have been a decade ago or 15 years ago. i believe the issue was before this committee. i am delighted to see my colleague from the state of texas and listen to testimony. let me just show my cards. i think compromise and the recognition of changing times is vital. all of us have heard refrain of creating jobs.

jobs can be created, maybe, if you or a small business and using online sales and you have one or two persons in your home or in their homes working with you. we don't want to disrespect that level of jobs. we also know that the idea of building bricks and mortar, persons working in a place, creates a stream of jobs. those who are building, those who pay the parking lot, those who have worked on the roads to get you to the location, and certainly those who work in the facility. and maybe if we had a number of black friday's we would have people working the shift in retail. i want to go to my friend from texas and tell me the story you

were saying about your town and stores and how much of a difference that makes. i would then like to follow up misener. eisne you have the twist on this with amazon with all of this attractiveness. i hope you can be part of the solution. let me go to the representative at this time. >> it is estimated currently in the state of texas but there are between 600 million and $800 million a year in sales and use tax that are not collected on out-of-state sales. that is a tremendous amount of money. that point out to media unfair competition that my storefronts are competing with. -- that point out to me the unfair competition at my store

fronts are competing with. i will certainly take advantage of selling over the internet. no one is discouraging that. no one is wanting to tax the internet. but in leveling the playing field, to make sure that my local stores will continue to be developed, i concern is, are we migrating to an economy -- and it appears that way if you look at the growth, not where we are in total dollars, but if you look at where the growth is, the growth is definitely to entice people to get to the internet. anybody who thinks they will not take an 8% discount into consideration on big-ticket items such as a camera or a computer or television set, i just do not believe that. >> speak quickly to the issue of "is too complex" if you begin to tax. we have migrated to a level of

technology that is probably less complex than it might have been 10 or 15 years ago. >> all the bills, as i understand it, before congress right now call for the verification -- for example, if we take hr 179 you could end up with as few as 25 jurisdictions. there are 21 states that are not in streamline that have a sales tax. and all of these have to provide the software if they're going to get to the local area. >> one quick question and then the gentleman from amazon. if we left some state out, i think we are at a point weather -- where we need to look at whether all 50 states need to be under that umbrella. >> i agree whatever is passed needs to be not only to the compact states, but all the

other states that make and why. >> thank you. you are the mother of all. what can you live with? as you look at this legislation and dealing with the complexities of dealing with taxation and the online marketplace. >> what we are trying to do here is trying to get congress to authorize all of the out-of- state the sailor-sellers with this -- all of the out-of-state sellers with this. it seems very reasonable to us. if 1% is at $150,000, we are talking about a fraction of 1% of online sellers would be required to collect under a $500,000 exception. it seems a decent compromise to us. >> you are saying all the states

in a compact and you can't -- you believe there can be a technology system that would not be complex to collect those taxes for the states, correct? >> yes, ma'am. he is trying to prove a negative where it cannot be done where they do not want to do it and we are saying we can do it and we will for our sellers. >> i think we have come to a collaboration here. mr. chairman, may i get a yes or no answer from mr. marshall? it looks as if he has a different perspective, but mr. marshall, would you be willing to engage in a compromise discussion on the panel here recognizing the loss of resources under the present scheme?

>> if i understand your question, i have small retail stores and i collect sales tax on the first dollar of my sails. any level of the exception is still picking winners and losers. all you are doing is changing the measure of which are winners and which are losers. some of online retailers would not be required to charge that. >> the gentleman's time has expired. the diamond from arizona for five minutes. >> the first question -- the gentleman from arizona is recognized for five minutes. >> the due process clause of the 14th amendment requires that a minimum transaction between a stake in a person is the minimum transaction it seeks to tax. i want to talk about a different avenue. each of the three bills has a

clause that this does not establish a nexus for any other tax or payment that is required. my concern is, since we are getting rid of that minimum connection, are we opening the door for other states to actually apply their regulatory environment on two companies that have no physical presence within that state? whether it be they pass a law that you do not have a physical presence and you need some threshold for annual revenue that will be easily ascertained through the sales tax, then they have to abide by the regulatory environment in said state. i will give an example. if you work over 40 hours a week, over time kicks in. in california, it is also anything over an eight-hour day.

are we opening a pandora's box that we are getting rid of this connection that we are going to allow a court to interpret what congress has done and also for the ability of the state to regulate within its own environment, but since we got rid of that specific connection, are we not opening the door to the fact that states will be able to regulate companies that have no connection aside from the actual sales into their states? >> i would think that doing so is a direct insult to the dormant cause or -- commerce clause. i would not think it would be capable of being done, but i have been surprised before. >> as have i.. >> that is what my chief concerns -- one of my chief concerns as to opening doors for what is trying to be accomplished by this piece of legislation. however, if we are not looking

at the unintended consequences of this, are we opening this door that would basically is to rate a company's ability to regulate and they could move their facility to a state that does not regulate? >> a legitimate question and one that needs to be considered carefully. i agree with your fear is that were to happen, that would be totally inappropriate. there are two things that protect you on this. peirce, congress has the authority, and that is why you see the language -- first, congress has the authority, and that is why you see the language in the bill. if they restrict the sales tax, it is only congress that can change that and and large that and make it further. >> in each of the three bills, it only talks about the nexus established for state and sales tax and only in terms of the cost, not in terms of the regulations or those types of

things moving forward. that is where my concern is. we need to broaden the language. >> i think the language can be broadened and i think it should be. before we pass this bill, we need to look at that carefully. the language needs to be brought where we feel more confident that it does that. second, as to congress setting the rules as to what is happening in interstate commerce, you still have the 14th of them in due process clause, which allows any individual to go to court and say, this has gone beyond that and is a due process question, too. i agree with your thoughts that it needs to be handled very carefully. >> ok, thank you. >> the due process question is particularly important for small businesses who are not necessarily in a position to advocate on their behalf. it would be a due process violation the lower the extension is.

it is not simply just for the sales alone that they may be a separate different state laws. >> one that i want to ask you about is well is, we have different numbers. at e-bay, what percentage of your sellers had annual revenues through ebay over $150,000? do you know offhand? >> like i said before, we have a significant number of sellers below that and a significant number above that. but very few that only use e- bay. there multichannel retailers in which they use many other places. they may use e-bay for sales. many use amazon for sales. it makes much more sense to say for each retailer what their obligation is across their

entire portfolio of business. >> do you want to respond? >> yes, sir. first, that means the sellers are actually smaller -- a larger .han mr. cohen has allegedl but back to the due process, mr. cohen is right. it is already decided that the due process does not apply in the interaction by sales. they actually dropped out the due process concern and left only the commerce clause concerned. >> thank you. i yield back. the gentleman -- >> the gentleman from georgia is recognized for five minutes. >> thank you. is there anyone on the panel who disagrees with the thought that government facilitate the ability of brick and click, or

just click, as well as britain and more businesses to actually do business? is there anyone who disagrees with that? government enables, or facilitates, your ability to do business, whether or not you do it just over the internet, whether or not you do it over the internet and you have a brick and mortar distribution facility, or you are just bored and mortar. mr. cohen, you? >> no, we do not. we are thankful that the government help to create the new internet. >> ok, all state and local government facilitate your company's ability to deliver your merchandise, correct? >> yes, sir. >> yes, i mean, somebody has to drive it down a road that was

maintained or built by a state or local government. laned, properlyme maintained, traffic signals, police officers to enforce the rules of the road, a court system for those who may be accused -- those delivery drivers of who may be accused of speeding if they go to court. and even if e-bay is unable to make -- to obtain payment from someone, they may have to depend on the local court system or police funded by the state government in order to collect. is that not correct? >> that is correct. >> is there anybody on the panel that thinks we should do away with state and local sales

taxes? >> can i continue, though? >> no, i want to answer that particular question. sales talks revenues, should they be outlawed so we can -- sales tax revenues, should they be are lots of weekend level the playing field between britain and mortar and bricks and click? -- brick and mortar and bricks and click? because i'm assuming that everyone feels there should not be on equal treatment between the two. -- in equal treatment between the two. >> we do not object to that. >> you have the sales tax to the business. the question is, how do we go about collecting the sales tax? that is what we are here for today. it is not so much, i don't think, that we should not have an obligation by internet

retailers to collect the sales tax. is that correct? >> a quick answer -- i think you're right. it should be a matter of state choice. states can choose whether or not to have a sales tax. texas chose not to have a -- an income tax, so they rely heavily on a sales tax. the texas and enterprise fund grant is taking advantage of texas hospitality, but has done nothing to help with sales tax collection in the state. >> >> mr. johnson and i appreciate the need for sales tax. but just two years ago when mr. these this was describing the obligations of the state, he

said that in washington, we get police protection, fire protection, send our kids to local schools. he said, i do not see why -- >> you have to use the police and fire and roads, drainage, and that kind of thing. you use that. >> amazons position to years ago is that he did not want that to collect. >> again, things change. [laughter] let me ask this question. why is it we would need a car about 4 -- carve out for small businesses on businesses collecting taxes on internet sales when we do not have one for burton moore? why should we have one for

breivik and click? -- four brick and mortar? why should we have one for brick and click? >> if you did a cost/benefit analysis, you would see the cost -- >> how about subsidizing it for small businesses? the cost? >> i am all for that, but as long as there is some cost, which there is always going to be, that at some point, if you're having people sell $10,000 or $20,000 on the internet and how to pick up the cost in order to integrate, that cost will be higher than the taxes they met. they have actually net losses. >> you are all good spokespersons for the need for government. [laughter] >> on that note, the time of the job and has expired. [laughter] -- of the gentleman has expired.

[laughter] i will recognize myself and take us back. the history of this is not that this originated with the internet. in fact, the decision was based on a mail order case. the chairman asked earlier what the reason was for not giving to the states the ability to collect the money. the reason was delved into somewhat by the gentleman from arizona. but the principals in those states want to impose this collection requirement on taxes have jurisdictions of their citizens. they do not have jurisdiction of the citizens of other states. and therefore, citizens in other states engage in various business activities do not have a say in how the laws are constructed in those states if they're going to be forced to comply. and here we are today, and have been for the last decade that we

have been dealing with this issue. the question really becomes not only one of fairness, but also of practicality for those businesses. my first question for you, mr. nelly, why should the congress cede some of these questions to you for what the standard is of these art of state taxes and that of setting a standard ourselves -- out of instead of setting a standard ourselves? >> the reason we put forward was the set out with the proviso that you could always appeal in the courts, which is the norm or -- normal process in the interstate commerce clause.

>> but you would effectively be the legislative body that would set, for example, the size of the small business that would be exempt from having to comply with the collection of the taxes. >> the whole premise of the would be when the legislators went to the governing board and then had to go back to their states and complied, but they were acting as agents of the states. >> what about the five states that do not collect sales taxes? how would they fit into this? >> those states would be burdened -- in other words, businesses that do business online in those states would be burdened, but there would be no benefit to those states because they do not have a sales tax. >> mr. chairman, let me go back and say the streamlined organization recognizes there

needs to be an avenue for the states that do not want to join streamline and do not want to read here to those rules. >> if they do not want to have a sales tax collected, would they be able to exempt those businesses from having to collect taxes from states that do? >> i'm not sure i follow. >> if you are in delaware and you do not have a state sales tax, but you have a business in delaware that is engaged in online businesses and making sales, that business is going to be burdened by having to collect sales taxes for other states, has -- ough delaware hous >> there is no burden on the business because there is no cost to the business to do that. >> let me get to that question. you indicated that you had software that would work for the streamlined businesses, the states that participate. what about a state that wants to

collect its tax, but continue its own unique definition about what the tax rate is. do you make a difference in their rates of these at 10 unified jurisdictions? do you have one raid or a different rate for each jurisdiction? >> the software allows you to handle every jurisdiction in the united states and sort out their rates. >> is a local grocery store collects a sales tax on the tavis chips -- potato chips and another state makes a distinction between the size of the bag, and other jurisdictions do that, this software will say, this is a 5 ounce bag, so we will not impose the tax, but it will bounce back will impose the tax? >> we have toggle switches that allow you to exercise choices. but to go back to your basic

question, we do not feel it is appropriate for congress to enact a bill that allows states to not join streamline, but to have their own systems. >> that complicates the matter for that small business, particularly for states that do not have sales tax. >> not really. >> i will ask mr. byrne to respond, since he had a different experience with the software implementation for his business. >> i do not believe this offer is, at least as of a year ago, it is not called -- is not as what is called an industry, vaporize. it is not as advertised. however, that is a technical problem that could be solved in probably a year or two. software could be created that does this smoothly. there is still not quite the usge of disagreement among

as their first appeared to be. >> but he said a small-business exemption and you are saying you do not need one. >> i think you need one to reflect the fact that there will be in plantation costs for any business. -- implementation costs for any business. it will be the state providing it, but there will be still and implementation cost. >> let me ask both of you this, this fore doing thu interstate sales -- and i assume you will be doing this for mail- order businesses and telephonic businesses and so on -- why not have one uniform interstate definition of what the taxes are? if you want to collect some different formula to meet some condition in your own state, great. but if it is out of the state

taxes, why not have one uniform definition and one uniform tax? some states with a high sales tax, may be day-lewis a pointer to, and those -- may be the day lose a point or two. those with low taxes, maybe they gain a pointer to. >> sir, i believe that is the direction the bill is heading. we are saying it does not create a uniform system. it is still a complicated system. a with a much simpler, uniform system. but it would still allow the states to keep their individual rates. they would have to provide the software and the interface that would be uniform. what you are proposing is going a step further where even the rates are uniform, which i would

applaud. >> my time has expired. >> a istore with the thing that you posit because it intrudes so much on -- i struggle with the thing that you posit because it insured so much on the federalism. >> it is interstate commerce. it is not something that is confined within the jurisdiction of a state. that is why we are here. >> i will have to think that through, and are not sure i can buy that on that basis. but let me think about that. second, let me say that the technology that we have today even within streamline that allows those troubles to be developed to allow -- those toggles to be developed to allow states to decide what is taxable and what is not, those are things that are being done with in that realm. i think the technology allows us to solve that without it being a

problem. >> anyone else want to comment? >> i am ok with the states having to provide a solution and hold the retailer harmless as long as they are using it. there's nothing wrong with that. the same thing that the streamlined compaq has done, why couldn't those who do not want to join streamline and do not want to change their definitions that have met uniformly throughout their stay -- >> and are you are talking are having a small business having to deal with a variety of different software programs. you have one for the streamline folks and then you have 20 different software programs. >> not the states go together to develop a compact. >> that is why i suggest a definition for one great. >> are you talking about a definition for all the states or

within each state? >> one definition for all the states. >> i would have to agree on the federalism standpoint texas does not belong to the streamline compaq now because we are not willing to give up that right. >> i understand, but you are making it harder to get where you want to go when it comes to collecting sales taxes through businesses that are not in the jurisdiction of your estate. >> than what we are going to end up with is what we have today, states going out on the road to define physical presence in all kinds of ways. >> i think we need to develop more consensus -- more consensus. >> before i came to congress i was elected to the california state board of equalization, whose main responsibility it was to collect the state sales tax as well as the use tax. i can attest to the dramatic

decline of the state sales tax and budget revenue because of online sales. i can also attests to the complete lack of compliance with the use tax obligation despite we have -- despite the fact we have a line on the income tax forms and providing people of that obligation. a few people even know what a use tax is and are shocked to find that they actually owe that tax, regardless of whether they buy online or not. i would like to ask our two state representatives, mr. kennelly and mr. otto, wire these not effective ways to collect the use tax credits -- a tax? >> in texas, because we do not have a personal income tax. the only odd you have is a

business that hold a sales permit. those would be the only business buying -- those to be the only people buying across state lines that would be subject to weather not they are paying the appropriate amount of unused tax. we have no form or reporting system for individuals unless they hold a permit to comply with paying the use tax. >> do you have auditors? >> yes, we have auditors. because sales and use tax makes up a large portion of our state budget from a revenue standpoint, we have auditors that are very aggressive. >> and senator? >> in indiana, we do have an income tax. what you are suggesting is a full employment for auditors act. it would require a lot of auditors. i pointed out earlier in my testimony that it seemed that

traditionally, sales tax has been administered by the retailer during the collection, and been given and allow us to do so and is the most efficient way to make the collection. the secondary problem, and we have talked about this in streamline, is once you try to find ways, other than fired -- hiring of legions of auditors to do this to make this work, for example, you might say that somehow or other we will demand that all the credit card companies send us a cross reference file by a -- about all of the purchases by consumers, and then you get into that and suddenly with a married couple you have a discussion about what this purchase was from victoria's secret. i do not remember that. there is an element of privacy intrusion there that we are uncomfortable with as public officials.

we do not want to go too far on that point. it may be over time that people will declare a use tax because we are all shopping over the internet in one form or another. but i think there are some errors to the where we have done it in the past. >> in other words, it is expensive and inefficient use of vouchers to collect the use tax. >> since you are doing it -- to use auditors to collect the use tax. >> since you are doing it at the point of sale, you would have the businesses do that. >> and what would it mean to the states to collect that use tax? >> for the state? courts to collect the use

budget. >> the estimates in indiana run up to $400 million a year. the bigger issue that we have to be about in congress is that this is a growing part of our commercial environment, so it is probably going to be a growing number regardless of whatever number you settle on. >> in texas, the estimates are up to $800 million per year. >> i would like to ask mr. misener of amazon, mr. burns said it cost many hours with i.t. staff, by using to have a different attitude toward the technology available to help collect the sales tax. can you talk more about that at about the purchasing of software in the locations where

you do have nexus, and does the technology exists? >> yes, we do collect. in the four states where we have retail business as a physical presence and we have nexus there, it is possible. you only need to look around and to the multichannel retailers that are collecting nationwide in 46 states. it is doable. you might say those early big companies. what about the little guy? the little guy will get services provided for him or her. they will not have to create the software. they will obtain it as a service from service providers. it is something that we plan to do. i certainly hope the day does it. maybe our friends at overstock will take advantage of our service as well. >> thank you. i yield back.

>> the gentleman from florida, mr. ross, is recognized. >> mr. marshall, dr. burnie indicates in his written testimony that based on the quill decision, the status quo is a success. would you agree? >> no, i do not agree at all. i think the situation is picking winners and losers. the retailer's incur expenses and benefits in all types of sale endeavors. if i choose to sell nationwide, i am perfectly comfortable incurring the responsibility, just as i do not admire retail stores for the state of michigan residents. any level of consideration for a certain size of retailer is creating a not level playing

field. and that is what is difficult, not to be able to compete on a level playing field with other retailers. >> dr. byrne, you indicated in opening testimony that the cost, compliance is the significant. legislation, the marketplace of equities at -- act to bolster your concern and give an argument that we need this because we have uniformity in the taxing laws? >> the streamline initiative would not create uniformity, but that is why we have proposed a bill that says, if you are going to do this, this is the way to do with that does create uniformity. it also has a provision where there is a small reimbursement. >> that is what i want to talk to you about because i think that is important. when you talk about cost compliance, whether you are a

small business or a big retailer, if you have to consider the cost of doing business. what would you propose as a cost of collection if you were to do this? >> 2% to 3% of the taxes that would collect on behalf of the stay would be our feet. and that would be not just internet fees, but burton moore -- break and more. -- brick and mortar. >> would you agree that maybe as an inducement of these on-line companies that u.s. least should cover the cost of collection? >> -- you should at least cover the cost of collection? >> texas has a grant to cover cost of collection. i agree that we should try to

compensate retailers in our states that have to remit sales tax. >> would you agree that there ought to be some compensation to cover the cost of collection? >> yes, and in the streamline agreement we struggled to reach the compensation. it gets smaller as you move down. >> mr. cohen, you were asked this question and on not sure of the answer. how many of your members would be affected by the exemption currently being proposed in the market equities act? >> $1 million. >> there are a significant number that would be above the threshold.

>> did you want to speak to that? but in asking a question. in my position, back home, america will put their life savings into a small boutique stores. they sell barbecue the girls and smokers. they are a great corporate park -- they sell barbecue grills and smokers. they're a great corporate partner for the community. but when it comes to purchase, and this is their complaint to me, they as a retailer are having to negotiate a 6% tax and they say they cannot do it. how do i respond to that? there is a desperate need for

community partners in the retail establishment, those that invest their life savings to make sure that their livelihoods are not only maintain, but that their communities are better off because of their investment. how to respond when i say we do not have any enforcement jurisdiction to allow you a fair playing field with online retailers? >> i love the brick and mortar and i have been a break and mortar guy myself. there are advantages and disadvantages. but what i would really say is that the pressure on them came from the big boxes. they have taken over 80% of retail. that is really where their competition is coming from. some other states than years is the selling those things online. it is a false dichotomy that

says it is internet retailers verses' the brick and mortar retailers. it is small vs. large. >> the consumer makes the choice to buy it on line because they do not have to pay the sales tax. >> the gentleman from florida is recognized. >> i would like to follow-up on that point. i do not know that is entirely accurate to try to shift the debate to a battle between smaller retailers, like mr. marshall, and the bigger retailers. in many ways, some of the smaller retailers -- correct me if i am wrong -- who have specialized products, those are the products where the consumer has to go online if they want to try to find a lower price, and often does.

this is a question i would like to put to you and to mr. marshall. you spoke, mr. byrne, about the benefit the bridge and mortar retailers have and the advantages people have in being able to go in and touch the products and to interact directly and have questions answered about the products. what are the benefits? let me start with you, mr. marshall. why would anyone go online ever to buy a product? >> in many cases, the purchase decision in a final analysis is based on price. every hour of every day, our sales associates to entertain customers questions, provide demonstrations, allow them to evaluate different instruments and then they are confronted with, ok, this is the best price i can get on the internet. can you match that? and with our 6% sales price we

could end the comfortably t-- ad we comfortably do with those internet retailers that also a charge the sales tax. but with the others we cannot compete. it is an unfair plainfield. -- playing field. the customer does not care. the bottom line is priced in so many cases. we cannot compete with that. it >> that is where the bill totally eliminates a tax benefit. we say, if you are going to do something -- you can level the playing field by taking off one side or the other. if you're going to take away the benefit of shopping online vs. the brick and mortar store, and

the state's arkin conscripting retailers to do the work for them -- the states are conscripting retailers to do their work for them -- >> since mr. womack and aspire are so committed to this that they sat through this hearing, let's assume for a moment that the legislation they have introduced is passed by congress and signed into law by the president tomorrow. if you talk about all of the potential costs, and i would like to open this question to the panel as well. the with the cost be to you? -- what would the cosby to you? >> right now, i would imagine -- what would the cost be to you? >> right now, i would imagine a couple of million dollars and

there would still be a liability because no one would have a guarantee -- >> mr. cohen? >> we believe there will be a significant loss of sales. there would use other types of services -- they would use other types of services and the auditing of states would not apply to them. that is why we are so adamant we would like a small-business exemption so we are not driven from the internet. we think the costs would go up. >> i understand you think the cost will go up. he bears an enormous amount of additional costs by having his door open so customers can come in and look up a product. customers are going to be driven to where? >> to larger retailers.

the cost advantage said amazon house right now will be magnified in the push back on small businesses to have a sales tax exemption. >> is that a battle you are willing to engage in, mr. marshall? everyone will run off to the larger retailers? >> that is the battle that large retailers and small retailers are in every day. if you cannot stand the heat, you should not be in retailing. we will battle big retailers. we have advantages over them. we have connection with the community. it is a level playing field and there are advantages and drawbacks to both. >> at least at that point there is a level playing field to engage in that.

>> absolutely. >> the gentleman from texas. >> i want to start with you, mr. otto. the texas legislature meets every two years for five months, correct? >> that is correct. >> and yet is the 13th largest economy in the world. something like that. and the primary source for revenue in the state is? >> the sales and use tax. >> people who build a building and sell a product take a greater risk than someone who is someone else -- somewhere else in the furtive plane selling through the internet. since you have been elected you have had courage -- hurricane katrina, hurricane katrina, hurricane gustav and others all

had texas. some businesses were destroyed, rebuild, destroyed, and rebuilt. that is the risk they take, but they have a disadvantage with the internet service retailer. >> that is true anywhere in the state of texas. >> whether it is fires or hurricanes or droughts, all of that has occurred recently. tell me about your concept that this is not a new tax. nobody wants new taxes on anybody. well, most people don't. >> this is not a new tax. >> keep it simple. >> when the sales tax laws were passed decade ago, the use tax was put into existence. this is not a tax that the business pays, but a tax on the consumers that the businesses

that retail collect on behalf of the states. this is not a new tax we are imposing. is it? we have been unable to collect, partly because of the -- it is a tax we have been unable to collect from habré because of the lines drawn in the quill decision. -- partly because of the lines drawn in the quill decision. i read it will over and over and i cannot find where it is not physical presence. but before we went into recession, the comptroller to send them a tax notice for $269 million budget have been collected over a four-year time frame. >> has that been paid? >> not to my knowledge. what i do not like seeing on the landscape right now for taxes or for any of our state is what states -- for texas or for any other state is what state are trying to do, make a physical

presence. we need to create a level playing field where everybody understands the rules and they are very clear. this bill that has been introduced in the house calls for simplification. it calls for software to be provided. all of these additional costs, the states will have to front that. if we want to take advantage of the provisions made available to us in this legislation, we will have to provide the money for that software. >> sales revenue in the state of texas. has it been going up, down, or the same? >> when i first got to the legislature in 2005, our sales tax revenues were growing at double-digit percentages until we hit the current recession. we have just now become where our august sales tax collections for 2011 got back to the level

they had pre-recession, but they are not back to the 2006, 2007 levels in what i would call at our peak economy. >> there are a lot of factors involved. it is one factor, or not, the fact of consumers buying online? >> that is correct. what is driving our recovery right now is the well and gas sector in south texas. and we have an oil and gas boom going on that is driving most of the sales tax. our housing sector has not come back, which is a big driver of sales tax in the state. >> was the biggest story in dayton, texas? it is not sonic, but what is it? >> wow, probably western auto. >> western auto. use best buy.

the consumer goes in and finds the television they want and what they are there they are ordering it on the internet right there in the main street store. no sales tax. 5%.as is at 8.2 they're ordering the same television set on the internet. that does not seem right to me. >> we had a meeting this last session that this was occurring with big ticket items. >> the lady from california, ms. sanchez. >> i feel like a last -- the last person who gets to go at a roast and all of the bus lines have already been taken. [laughter] to i appreciate your patience and i have listened to all of the testimony and questions with a lot of care. hopefully, i will not be repeating some of the points that my colleagues made.

mr. marshall, i understand you are a family-owned business, second generation, and you have seven physical stores. and did not start out that way, did it? >> no, it is just in the last 15 or 20 years that we have expanded from a single location. >> when you opened that single location, did the government help you with any of the collecting of the costs of the sales tax of the items you sold in your store? >> it predates my time, but to my knowledge, no. the system that exist within the state of michigan for collection of sales tax seems unreasonable. -- seems reasonable, and there are considerations for the burden of collecting it. my father was a pilot in world war ii. and my mother worked for the government during world war ii. it was savings they accumulated during that time that made the

down payment on their first music store. >> and i am somewhat facetiously highlighting that point. there seems to be a lot of consternation about the cost of implementing compliance with the sales tax revenue to online purchases. you have admitted that you also sell products on line, correct? >> correct. >> and what percentage -- just give me a ballpark -- of the percentage of business done on line verses your store. >> less than 1.5% on line. >> if we were to view used for ackley through online sales and when you take in -- view you as strictly to online sales and your onlineke in sales, you might look like a small business, would you not? if we start we looked at you

through on-line sales. >> indeed, and i would have a competitive advantage over those that do have to pay sales tax. you would still be picking winners and losers. >> and with the proposed limits for what a small bomb -- small business online retailer is, and you can correct me if i am wrong -- you do not know what percentage of people strictly sell online, but it could be a situation like mr. marshall's situation where part of their portfolio is online is strictly through the prism it could look like a small business entity, but they could be doing millions or billions of dollars of business through the other platforms through which they sell. is that correct, mr. cohen? >> yes, and for many main street retailers, we think the internet is a great way to expand the business. exactly.

>> i understand, but creating these artificial distinctions between the burk and more stores and online sales, -- break and mortar stores and online sales, it brings a lot of attention to this discussion. i used to serve on the small business committee. the definition of small business is pretty much in the eye of the beholder. if you look at s.p.a., a government entity, their definition in some instances -- at small business association, a government entity, their definition some instances is a five employees. -- 500 employees. for some people, that would not be a small business. if you look at the irs and the filings they receive, in their eyes, most businesses in the u.s. employ five or fewer people. if you ask the man on the street if that sounds like a small

business, i imagine most people would say yes. but you have these huge disparities in what the definition of a small business is. with respect to the small- business exemption, and with all due respect to the idea there are startup costs to starting a new system and to implementing it and to recouping the sales taxes, you know, those are expenses that physical stores incur and nobody helped them with the cost of transition or with the cost of doing business that way. we need to be careful when we talk about what the criteria should be. what looks like a small business in online sales could actually be someone who generate a lot of sales in another context. i see my time has expired. i thank you all for your participation and your patience. i yield back.

>> i would like to thank our witnesses for their testimony today. without objection, all members will have 5 legislative days to submit additional questions or materials for the record. the hearing is adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] mitch mcconnell and richard lugar on the keystone oil pipeline. then a house debate on unions a in workplace. later president obama in scranton, pa. calls on congress to extend tax cuts to workers.

>> britain has evacuating all embassy staff after protesters stormed the embassy compound. the a senate panel looks at the u.s. policies. the chairman of the state department and the treasury under the secretary for terrorism testified. this starts at 10:00 a.m. eastern on c-span3. later, the executives from fannie mae and freddie mac will take questions at an oversight hearing along with the acting director of the bedrock housing agency predicts of the federal housing agency. -- of the federal housing agency. >> next, republicans unveil legislation to unveil the keystone pipeline.

this news conference is about 35 minutes. >> come over, and gentlemen. good morning. there is a lot of discussion about unemployment and job creation. the economy is slow. there has been a lot of talk about shovel ready, what is it and what is not? we know there is one major shovel ready project ready to go. that is the keystone pipeline. i have members of our republican congress who have been deeply involved in issue both because they are safe or because they have jurisdiction over this issue.

unfortunately, it is apparent the president has planned to delay this past the election. if i were speculating, i would conclude he is not likely to carry any of those states. by delaying it, he is making an effort to curry favor with activists who are skeptical or downright opposed to this project. what we do know is if we went forward it would create jobs almost immediately, a lot of jobs. with that, let me turn to senator lugar. his committee has jurisdiction over its legislation. others behind me have been deeply involved in issue over the last few months. dick?

>> we are grateful to you for your leadership and starting off the screen press conference. i wanted to say that our foreign all probability in danger urging -- our foreign vulnerability put us in danger. we spend billions of dollars to ensure safe passage of oil around the world. building the pipeline now is a dramatic opportunity to change that energy and national security equation. we have a dramatic opportunity to create american jobs in now. job creation is the number-one issue in nation. the keystone pipeline is the largest infrastructure project ready now. for construction in the united states. president obama has the opportunity to help create

20,000 new jobs in now. he has delayed the decision until after the 2012 election in fear of offending part of his political base and risking the ire of construction union to support the pipeline strongly. we introduced legislation today requiring the obama administration to issue a permanent within 60 days to allow the keystone project to move forward. it contains environmental protections, guards states rights, protect nebraska's ability to shift the route around the sand hills without holding up construction, and includes a comprehensive federal review of the final environmental impact statements. keystone is a $7 billion private sector investment in united

states. half a billion in salaries, a $6.5 billion worth of material and other economic activity. after constructing the pipeline, it will continue to be a job creator and encourage oil production along the routes such as the areas of north dakota and montana. reliable trade with canada has the need to pursue alternatives. my own plan would do this by 3.6 million barrels per day. at the same time, we cannot afford to lose the reliability. the administration has failed to produce a domestic strategy to

reduce foreign oil dependence. now there is the potential of energy security with in north america. the keystone bill will stop the demonstrations delayed tactics. it falls within the jurisdiction of the foreign relations committee. i will push for the quick is consideration. i want to express my appreciation for the enthusiastic leadership of mitch mcconnell as well as several senators. i want to thank each of my colleagues for their assistance. we must not delay the energy producing and job-creating opportunities of this project. it is not only a matter of our national security but also our pocketbooks. they predict a record high gasoline prices by early summer 2012. there is no time for delay. we now have 37 sponsors of this

legislation. as you can see, a galaxy of senators who are prepared to testify on behalf. let me mention and recognize urkowsky, isaacson, others have come. perhaps they will also want to speak. i have been working on this since i was governor of north dakota. most of you are aware that there is a keystone pipeline that runs from north dakota and read all the way down to illinois region

and runs all the way down to illinois. -- and runs all the way down to illinois. this would run down the western border of north dakota all the way to the refineries along the gulf coast. it is a 1,700 mile pipeline. this legislation addresses the concerns that have been raised. this is about solving the challenges and meeting the concerns and moving forward on a project that is very important to this country both in terms of job creation. more than 20,000 jobs are created immediately. potentially 250,000 jobs are created with the spinoff effects. we need the jobs to get our economy going and it reduces our dependence on oil from the middle east. it is about energy security.

also the way we structured this legislation is about making sure we met the environmental concerns that have been raised. what it provides is 60 days after it is passed, the project is deemed approved by the department of state that it meets their requirements so the construction can move forward. as for nebraska, but there has been concern about the sand hills -- where there has been concern about the sand hills, a they have a special session. they will regroup in the pipeline in their state. of this legislation incorporates that solution into what we are doing. we address the environmental concern that has been raised in nebraska. we in able -- enable it to move forward.

a big economic impact. big jobs creator. reduces our dependence on the oil from the middle east. concern has been expressed about emissions from oil production in canada. with this pipeline, there is less co2 images, not more. why is that? the production will come down to our refineries. if we do not get this pipeline, then canada will build the pipeline for the west coast of canada. it will be loaded on super tankers and be home to places like china where it will be redefined in places that have emissions. in addition to the commission's -- emmissions, we will import more products from the middle

east and places like venezuela. we will be taking of oil around the globe to wind up in the same place. you have more emissions without the pipeline. we're talking about job creation, energy security, and a common-sense solution. we need to move forward. >> thank you. i strongly support this approach as well. this is an important project that has been delayed too long. on the energy side, 700,000 barrels of oil from canada everyday with this pipeline could completely displace what we import every day from venezuela. it is almost the same amount. that could displace a large segment of import from the middle east. it does not make sense to get this energy from canada versus of venezuela or some of the oil

from the middle east. it is very important for energy. it is not just canadian energy. it is important for a domestic energy production. we have log jams for getting domestic energy to refineries on the gulf coast. it'll help but that as well. already jobs, 20,000 new jobs, $7 billion in new investments. this is long overdue. this was delay before this recent announcement. in march, many of us had legislation to mandate the movement on this. we had amendments since then. now this new announcement kicks the can down the road and insurmountable amount of time. the american people need the economic activity and energy now. this will get us going. >> i appreciate the opportunity

to be here. i would like to thank senator hoevon and sister mcconnell. -- senator mcconnell. they have move things along. i'm here to support this legislation. i'm one of the co-sponsors. there is an important point to make this morning. the issues and in and nebraska have been resolved. this legislation recognizes the agreement that was reached in nebraska. it accommodates that. ifh the president's actions, he were to act today on the permit, the jobs could start to be created. the work could commence. this legislation recognizes that there will be this and nebraska

process but nothing prevents the work be getting on this pipeline today. even though we are working on this legislation and are hopeful about the chances of passing, the simple message to the president of the united states is that if you really want to create jobs, if you really want to provide energy independence for this country, approved the permit. recognize the nebraska process but allow the construction to start on the rest of the pipeline. that literally could happen right now without having to wait for the legislation. what the legislation does is it says we think these are important issues. we want to get congress behind this. get the permits granted. the president could really do

this on his own and create the jobs right now that our nation needs. i will wrap up where i began. i think the senators for their leadership on this. i appreciate the good work of the folks back home in reaching this agreement with canada. >> thank you. i want to have the knowledge of those that have worked hard to find a solution to go forward. as a ranking member on the energy committee, i am always looking for good energy policies. this delay from the obama administration of the keystone pipeline is not good energy policy. this is bad. this is politics, plain and simple. for the people that are looking for a job in country, the 20,000 that may have held out hope that they would have been working on

this project, this is really disappointing that they will have to wait until the other side of an election. this legislation has been drafted and it tends to provide a positive path forward. that is important for us to recognize. it is not only about the jobs. jobs is the number one issue in this country. it should be the main focus. from an environmental perspective, it is the smart thing to do. what my colleague mentioned, he laid it out. we were talking about an interest in co2 emissions. it think about the full cycles if you do not have a pipeline. that is the direction it will go. if it does not come into this

country. from the environmental perspective, this is critical. from the jobs perspective, this is necessary. from a north american energy independent perspective, it is important. we need to be talking about north american energy sources. why will we not go to our closest neighbors, our best ally when it comes to trade, to provide for a resource that we as a country will continue to need? to turn our back on canadair as this delay did was the wrong step. it was misguided. it was politics at its worst when people are counting on jobs and economic activity. >> every time president obama

makes a speech, he talks about jobs and lessening our dependence on the middle east to run this machine called america. there is not a piece of legislation right now that will do more to achieve both of those goals. if you look at the jobs we talked about, at in my state of oklahoma, we are talking about 14,000 jobs that come with this legislation. when you talk about dependency on the middle east, there are two things that can stop it. to use our own reserves because it is a political problem that we have a. if we were to do that, we would not reduce our dependence. we would stop our dependence. that is how significant this is. senator hoevon spoke about the long ride around. it will still be shipped around the world and end up here.

we remember the exxon bao says. -- valdez. we remember the utilization of the pipeline. we would have the incident. most of this would go through. it has to go through it to get down to texas. it is imperative. this is our opportunity to do something real. >> everyone has made such good point. -- points. we have spent so much in this country on a stimulus packages that have not stimulated employment. here we have a non taxpayer funded entity that will create jobs and create cheaper energy

for the small businesses in our country. what is not to like about that? i am so proud that congress is saying to the president "to do this now. you do not have to wait to congress. you can get this pipeline going and 25% of the refinery is done in taxes." sure that we have the cheapest and most abundant energy sources in country if the president would pass it. congress will give him a bill that will let him make that choice. thank you. >> thank you. thank you for your leadership. i will say this. at a time of 9% unemployment, it

is a failure to deny the creation of 20,000 jobs. it is a failure of leadership. the middle east is very uncertain and unstable. we do not know what will happen. if something were to happen and we look back on our failures and develop a reliable source of petroleum, is to be the condemnation of the administration. we should move ahead now. thank you. >> there is a lot of debate downstairs about how to spend money we do not have. if the president waited three years to send a state agreement

would take 250,000 jobs, now it will create another 100,000 jobs. we do not need more government investment. we need more private business investment. our policy should be fined more north american energy and use that. this is the way of finding north american energy. for the first time, if we have more than we need we can make money instead of spending money. >> i am happy to join my colleagues who stepped up and provided some leadership.

i think it is a really thoughtful approach. it addresses the concern that the state of nebraska has had to come up with a good solution for their state. this does creates about half a billion dollars of hundreds of jobs and tax revenues. it is a no-brainer. it has been studied and scrutinized and analyzed. it has been viewed for three years. there is no reason why this cannot move forward. it is not because the president has put his political agenda and his job ahead of jobs for american workers. pietas been set clearly by my colleagues. it is that. -- it has been said clearly by my colleagues.

it is that. everything has been done. if you think about what it can mean for this country in terms of jobs for american workers, and the energy security has already been mentioned. it would be a great story about a net exporter of energy. this is a wonderful story that will continue to create more jobs for people in this country. we are trading with a country that is an ally. our biggest trading partner is canada. the oil either go to the united states or some place where we will benefit from it or other countries around the world like china. that is another upside to this whole equation. this has an environmental

benefit as a result of us using and refining that oil here. it is a no-brainer. you sit back and you look at this thing. did the only conclusion you can draw is that the president has concluded that this is not in his own political best interest but is in the best interest of the people and our energy security. for all those reasons, i hope this will advance through the process. the jobs will be created. this country will benefit as a result. >>, it of the oil that has been imported will be -- how much of the oil that has been imported

will be used? >> we import 2 million barrels a day from canada. this will increase by 700,000 barrels a day. we will be along the route and putting product into the pipeline as well. right now there is 100,000 barrels a day produced in north dakota and montana. we will have an on ramp. that will be put into this pipeline as well. we are still a net importer of crude oil. some of it, depending on transportation, could go offshore. >> are there any plans to try and get a vote on this? >> hopefully we will have a

hearing shortly. this is important in terms of our process. we will work with the leadership, both democratic and republican to bring legislation. we perceive it as a crucial item. >> we have 37 sponsors' right now. we are continuing to add them. we hope to get it to the floor. >> there has not been a discussion this far. >> has the president spoke about this project?

>> not specifically. this is a project we have been working on for a long time. a goes all the way back to last year when i was working on it with the governor of montana to try to get on ramps to the pipeline. the breakthrough came after talking both to transcanada and nebraska. that was the breakthrough. this seeks to address the issue so we can move forward. >> they said that it could not read about it. does this give you much space? it will be used in the united states.

>> i do not think it was a credibility issue so much as they were fixated with the pipeline route had to be the route. what happened is the state of nebraska called a special session. the purpose was to consider legislation that would place nebraska in the middle through some process. it was and that atmospheric that transcanada realized that there is a huge downside. it would create a very impossible situation. the best approach would be to see if they could reach an agreement with nebraska. that happens.

that happened right after the special session started. for me it is that a credibility issue. i think they prefer the original route. they realize that practically speaking they needed to come to some kind of agreement with the state. that has been done. this legislation respect that process. the president can start this by the granting of the permit. he does not have to wait for us. one last thing i would like to say. if you check the comments that have been made by secretary clinton, at the state department has jurisdiction, she said we will be done by the end of the year. then there was the circling of the white house by the environmental groups. the president's got in the middle of it. all of a sudden now we are being

delayed more than a year. the president can build this pipeline today. >> there is one other issue, too. transcanada has gone through three years of the process. to change it starts over with the process. that is why it is so important that they have their special session and stepped in. this was also part of their concern. there would have to start over if it was changed. >> [inaudible]

that says that nebraska will conduct an environmental statement with their own contractors. is this bill the same, that you have 60 days to get approval? isn't that going to speed of the nebraska and our mental process? -- up the nebraska environmental process? >> no. >> there are provisions that say [unintelligible] to see the impact on the pipeline. don't you think it is better to udy is donethe stod

before you move forward? >> we worked on this for quite a while. this legislation provide it isal 60 days after passed of the projects will commence. -- past so the project will commence. they have the time they need. that approval will be included once it is completed. it does not set a limit on their process. it allows the project to comment and for the new route to be cited. is that will be incorporated into the 1,700 mile pipeline. to the extent that co2 emissions are a concern from oil, this

provides a total net reduction. if that is your concern, this helps address that concern. >> john has raised the exact point. this respect the process. construction can start right now. we will go through the nebraska process. the governor will certify the route chosen. the president accepts that. we have a complete the process of recognizing that nebraska has a role to play. we will complete that. construction can start now. >> will the pipeline project have an effect on [inaudible] >> anytime you increase the

supply you put downward pressure o. this is reducing our dependence on places like the middle east. it is about energy security. supply is a huge job creator. >> thank you very much. well done. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> tim griffin will talk about proposed changes to federal benefits. then an update on what the house will be working on before it adjourns for the winter break. congressman earl blumenauer

joins us. "washington journal" each morning at 7:00 a.m. eastern. >> when i look at why a country does well or does not, it is a value thing. it is not resources. these are really crucial values. do you believe the future can be different than the present and do you believe you can control it? this is not universal. people have it or they do not. in u.s., we have an exaggerated sense. >> and david burke so take your calls and e-mails on a variety -- david brooks will take your calls and e-mails on a variety of topics. live this sunday at noon eastern. >> president obama was in

scranton, pa. today and called on congress to extend tax cut. that is later. earlier, the house passed legislation to block a proposed rule by the relations board that would speed up union elections. the vote was 235-188. here's part of that debate. chairman. mr. chairman, i rise in support of h.r. 3094, the work force democracy and fairness act and yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. clines: thank you, mr. chairman. the -- mr. kline: thank you, mr. chairman. across the country, the american people are asking, how can we get this economy moving again, what will it take to finally put people back to work? and washington is responding with a number of answers. some think we should support

more spending, more taxes and more regulations. in essence they're asking the country to double down on the same failed policies of the past. my republican colleagues and i believe we should chart a different course, one that includes removing regulatory roadblocks to job creation the work force democracy and fairness act is part of that effort. the legislation says we shouldn't allow unelected bureaucrats to dicta policies that make our workplaces less competitive. in june, the national labor relations board proposed sweeping changes to the rules goveing union elections. under the board's radical scheme, employers would have just seven days to find an attorney and navigate a host of complicated legal issues before confronting an nlrb election official. employees will have as little as 10 days. 10 days, mr. chairman, to decide whether they want to join a union, denyg them an opportunity to gain valuable

information and make an formed decision. the nlrb is already telling employers like boeing where they can and cannot create jobs. now, the board wants to take away a worker's right to make a fully informed decision in the union election. this proposal largely prohibits employers from raising additional legal concerns, denies ansrs to questions that can influence the votend turns over to union leaders even more personal employee information. . let's get sothing straight. the board scheme isn't about modernizing the election process. this is a draconian effort to stifle employers' speech and ambush workers with a union election. less debate, less information, and less opposition. that's big labor's approach to workers' free choice and it's being rapidly implemented by the activists nlrb. mr. speaker, for four years democrats controlled this congress. to my knowledge not once did

they try to streamline the union election process, not once. they did champion a failed effort to strip workers of their right to a seet ballot, but they didn't bother to offer any solutions to the alleged problems they now say plague the election process. today union elections take place on an average of 31 days, giving workers a month to consider the monumental question of whether or not to join a union. one month. cases where delays have occurred? yes. without a doubt these are the exceptions to the rule, and former and current members of the nlrb have cited partisan shifts on the board as the leading cause of such delay. a broken board is no excuse for trampling on the rights of american workers. i'm aware the board recently revised, meaning yesterday, its earlier proposal and setaside some of the more egregious provisions, however the latest iterations still denies employers access to a fair

election process, still drives workers of the opportunity to make a fully informed decision, and still perpetuates the threat of more punitive measures in the future. the board teams utterly determined to finalize a flawed proposal regardless of the damage to the integrity of the board and our workplaces. we must act now. the work force democracy and fairness act reaffirms work force protections our natn has enjoyed for decades. employers currently have a fair opportunity to prepare for a pre-election hearing. the bill ensures employers have at least 14 days, two weeks, a fair opportunity to prepare for the hearing. employers and unions can currently seek board review of issues raised before the election of the the bill preserves their right to seek board review before the election. workers currently have an average of 31 days to decide their vote. the bill guarantees workers at least 35 days. before the board's reckless specialty health care decision,

a commonsense standard determined which employees would participate in the election. once again, h.r. 3094 takes steps to restore traditional standard, ensuring employees continue to have freedom and opportunities in the workplace and employers can effectively manage their labor costs. despite the heated rhetoric we will hear from opponents today, the bill is a responsible effort to set in law, set in lawmr. chairman, protections workers and employers have long enjoyed. i urge my colleagues to support the bill and i reserve the balance of my time. the speaker pro tempore: the gentleman from minnesota reserves. the gentleman from california, mr. mier, is recognized. mr. miller: i yield two minutes to the gentlewoman from new york, ms. slaughter a. member of the rules committee. the chair: the gentlewoman from new york is recognized for two minutes. ms. slaughter: thank you, sir. i appreciate the gentleman yielding. mr. speaker, with millions of americans out of work, job creation certainly should be the

number one priority of this congress. and yet where are we today? not creating any jobs here. but when using the precious floor time considering the bill that attacks the rights of all american workers and has no chance of becoming law. that unfortunately is something we do week after week here. as my colleagues have pointed out, rather than minimizing delay in union voting procedure, today's bill mandates delay. e bill empowers employers interfere in union elections by adding anti-union employees to voting blocks, gerrymandering the elections. that by itself should be enough to vote against this bill. letting employer delay and manipulate union elections is an attempt to put the fox in charge of the hen house. it is a direct attack on the ability of workers to bargain collectively to protect their rights and we have seen in america with lots of protests and uprisings that american

citizens don't like that so much. now, wherever you work, whether it's union or not, if you appreciate a 40-hour workweek, for sick leave and vacation days, for safer working conditions, don't blame the men and women for the unemployment crisis, but thank them for bringing those things to you. it was not a ben nevillent employer that gave you those. it was the union movement. rather than considering a bill to attack the american worker, we should be working together as we plea on the floor day after day to create jobs so the american people's situation gross more dire every day. i urge my colleagues to oppose this bill and see if we can get to work to create jobs. i yield back the balance of my time. the chair: the gentlewoman yields back. the gentleman from california reserves. the gentleman from minnesota is recognized. mr. kline: thank you, mr. chairman. the gentlelady just said we should be addressing legislation to create jobs. that's exactly what we are doing

today. at this time i'm very pleased to yield three minutes to the chairman of the subcommittee on health employment and labor pensions, the gentleman from tennessee, mr. roe. the chair: the gentleman from tennessee is recognized for three minutes. mr. roe: thank you, mr. chairman. i rise today to urge my colleagues to support the work force democracy and protection act. our country is in the middle of a jobs crisis. the national unemployment rate is hovering at 9%, in tennessee where i live it's higher. millions of american families are struggling to make ends meet. amidst this economic uncertainty, the house has passed over 20 bills, jobs bills, that would help secure our economy that's sitting on the senate side right down the hallway here unvoted on. sadly the senate isn't the only road block to economic recovery, that's why we are here today. to rein in a national labor relations board that's run amuck. i grew up in a union household. my father was a member of the united rubber workers union and i know about this.

lived with it. grew up with it. in june what problem are we trying to fix? currently elections are held as the chairman said within 31 days and unions win almost 70% of the elections held. let's say the first of october of this year you wanted to have an election, by the end of that month you could vote on whether a worker wanted to be in the union or not. a very fair process. if this rule goes into effect as he said, seven days for an employer to fi representation to go through over 400 pages of rules, on this very complicated subject, it gets worse. rely only 10 days, as little as 10 days, to vote. so a worker would have to make their mind up in some cases, it could be as quick as 10 days. imagine voting on the presidency of thebs in -- united states in 10 days. it gets worse. workers would then be required by law to hand over personal information. what we want to do is allow the employee to decide what information is given to the

union about how theyant to get contacted. mr. speaker -- mr. chairman, i should say, this just isn't right. nor is the national labor relations decision to redefine how a bargaining unit is determined right. instead of creating jobs, employers will be forced to negotiate with a multitude of small bargaining units whic will raise labor costs and destroy possibility of advancement opportunities. something must be done to restore the fairness to the union election press. that's why i'm a proud co-sponsor of this legislation. the bill simply does this. gives 14 days to pass before a pre-election hearing is held. this hearing will allow both sides to raise any relevant or material issues in a nonadversarial environment. it would protect the workers' right to make an informed choice by requiring an election take place in not less than 35 days. we owe it to our constituents, let them hear both sides of the stor and make up their own minds. workers' privacy should also be protected. allowing the employers of a union's access to what the

employee decides they want be contacted. this bill also restores long-standing rules for defining what a bargaining unit is. it's over three decades of rules. mr. chairman, there's only one way i can describe this bill as common sense. i respect the right of the workers to form unions. that's their right under the law. but i believe that the union election should follow a proses is that is balanced and protects the rights of employees and employers. not just the unions. i urge support of this bill and i yield back the balance of my time. the chair: the gentleman yields back his time of the the gentleman from minnesota reserves. the gentleman from california is recognized. mr. miller: i yield myself four minutes. the chair: the gentleman is recognized for four minutes. mr. miller: mr. speaker, members of the house. during the depth of the great depression congress gave the american worker the right to band together with co-workers and bargain for a better life. for more than 75 years the national labor relations ted to vest the ultimate decision to form or belong to a union with the workers themselves.

the principle underlying this law when workers decide they want a union, they should get a union. these rights and this law have served this country well. it's built the middle class. brought us the 40-hour workweek, safe workplaces. these rights ensure that economically secure families the prospect that our children could build even a better life. these rights have been an unqualified success. they help to create an econoc engine unparalleled in the history of the world. but especially this year forces have gathered that would do anything to take away those rightsrom american workers, from american families. these forces subscribe to the pervis ideology that says workers should just accept whatever the powerful decide that's good enough for them and that's the end of the discussion. they use real crises as an excuse to gain more power. we have seen it in wisconsin and ohio across the country where the real goal was to takeway the rights of workers not to soe the economic problems of those

states. where the real goal was t constrain workers from collective bargaining process not to deal with the economic problems of those states. where they don't control the state houses and state legislatures, they have come to the congress of the united states. this bill today is part of that scheme. this bill is part of a national effort by the republican party, by the chamber of commerce, and the business -- much of the business community in this country to strip workers of their rights at work. to take ordinary working men and women and they will them they will have no right to join a union. they will not be able to gather for an election because this legislation prevents that election from happening. how does it do that? it does that, one, by having the employer be in the bargaining unit. not the employee as is dictated under the law and as affirmed by this congress over and over again. that decision belongs to them. how does it do that? it stuffs the ballot b at the outset and the employer making

up the bargaining unit as opposed to the employee. then they throw in the ability to have whatever frivolous appeals, issues you want to raise, no matter how frivolous, they must be raised before this time, before the election, and all of the appeals must be decided. so while they talk about how this gives us a tight time frame, what we see is endless delays, endless running up of legal costs, of attorneys on both sides, all in the idea of buying time for the employer to intimidate the employees from joining the union, to constantly hold businesses in the workplace, face to face businesses, to advocate against the union so they can turn around the decision that the employees essentially have made when they say we want to go to an election,e want to have a union. this is ourargaining unit. and that's the goal here is to destroy the ability of this law to function. and you cannot have the

situation where that exists in this country because this law is not only important to employees in the workplace, it's important to millions, millions of americans who are in the middle class in this economy today. these are people who are there because of the collective bargaining rights of people over the last 75 years in this country to bring the benefits, to bring the wages, to bring the job security, to bring the health care benefits, to bring the pension benefits, and protections to middle class families. we have seen as the unions have declined, so have the wages, so have the benefits of workers to their own productivity. the american worker continues to increase their productivity. they are the most productive workers in almost every sector of our economy in the world. and yet more more of their productivity is being siphoned off by the 1% if you will. by the employers who decide they need more bonus, by the employers who decide they need bigger paychecks, by the employers who decide they need more shareholder dividend. employers who decide they need

more golden parachutes. the chair: the gentleman's time has expired. mr. miller: that's what this is about. it's about stealing from the american workers and not giving them a right to continue to bargain for the benefit of their families and their community. we ought to reject this bill today. the chair: the gentleman's time has expired. the gentleman from minnesota is recognized. mr. kline: thank you. mr. chairman, i'd like to yield two minutes to the chairman of the subcommittee on work force protections, the gentleman from michigan, mr. walberg. the chair: the gentleman from michigan is recognized for two minutes. mr. walberg: thank you, mr. chairman. mr. speaker, as i a former united steel workers union member stand here today, the unemployment rate in michigan stands at 10.6% and in areas of my district it is as high as 14%. our primary focus in congress as passed in the republican jobs plan and seated in the senate right now, our primary focus is

to get burdensome governments regulations out of our way and out of the way of the american people and let them get back to work. the national labor relations board has taken actions that directly oppose american job providers and job creators. how can any michiganian operating a business expect to compete on a level playing field with nlrb membership like craig becker who once wrote, and i quote, employers should be stripped of any legally interest in their employees' election of representatives. and also that, and i quote, employers have no standing to insert -- to assert their employees' right to fair representation. . in their recent action to create an ambush-style election process, the nlrb took a special interest attorney over the will of the american people. the rogue majority of the nlrb wants to set conditions that

stifle job creation and expansion. job creators are terror find of the nlrb's actions to create an ambush-style election process that will prevent employees from making an informed decision. and more stunningly, they reversed 30 years of precedent through their specially health care decision which would allow unions to carve up a work site however they choose. america's job creatorsnd work force deserve fairness to ensure that union representations like elections for our political leadership are done in a just manner that allow all participants to make an informed decision on their representation status. the work force democracy and fairss act will ensure that employees and employers will have a level playing field that the nlrb and its special interest allies are determined to tilt. and i yield back. the chair: the gentleman's time has exred. the gentleman from minnesota

reserves. the gentleman from california is recognized. mr. miller: i recogze the gentleman from new jersey, mr. andrews, the ranking member of the committee. the speaker pro tempore: the gentleman is recognized for how many minutes? -- the chair: the gentleman is recognized for how many minutes? the gentleman from california has yielded time to the gentleman from new jersey but for how many minutes? mr. miller: three. the chair: the gentleman is recognized for three minutes. mr. andrews: mr. chairman, the american dreams have been based on a basic deal -- if you go to work every day and work as hard as you can, you'll make a decent wage. if you get sick and have to go to the hospital, you'll have health benefits that means you won't lose everying youave because you got sick. at the end of the 40th hour of the week your time belongs to you and your family, not to your boss, unless your boss is willing to pay you time and a half.

and you don't have to work until the day you die because you can earn a decent pension and spend the golden moments and days of your life taking care of your grandchildren and family. that's the deal. none of that existed for most americans before collective bargaining existed. america has a middle class because america has collective bargaining. this bill is not about the number of days before an elecon or the size of a bargaining unit. this bill raises the issue of whether you truly believe in collective bargaining. and what this bill does is say to the minority of employers in america, and i think they are the minority by far, who would choose to subvert an election process, who would choose to intimidate and coerce their workers into voting against a union, this bill gives them the

road map of exactly how to do that. it is a subversion of the american middle class because it's a subversion of collective bargaining our grand fathers and grand mothers stood on picket lines to fight for collective bargaining. the people of ohio stood on election day to fight for collective bargaining. colleagues, let us together stand today against this legislation and for collective bargaining and the american middle class. i yield back. the chair: the gentleman yields back the balance of his time. the gentleman from california reserves. the gentleman from minnesota, mr. kline, is regnized. mr. kline: mr. chairman, at this time i'm pleased to yield two minutes to the gentlelady from alabama, mrs. roby. the chair: the gentleman from alabama is recognized for two minutes. mrs. roby: thank you, mr. chairman. mr. chairman, i rise today in support of h.r. 3094, the work

force democracy and fairness act, a bill i proudly sponsor. as a representative from alabama, a right to work state, the continued activist agenda of the national labor relations board is alarming. its proposed rules are a clear example that the white house and the nb are committed to a culture of union favoritism. the nlrb's proposals undermine the rights of employers and employees by empowering unions to manipulate the work force for their own gain. the work force democracy and fairness act is one of many bills put forward by my republican colleagues that will prevent the nlrb from imposing sweeping changes to our nation's workplaces. additionally and most importantly, this bill restores

key labor protections that both workers and employers have enjoyed for decades. i want to say that again. this bill restores key labor protections that both workers and employers have already enjoyed for decades. congress has the responsibility to ensure that the nlrb's labor interests are not undermining an employer's efforts to create jobs and grow their businesses. at a time when approximately 14 million americans are unemployed and searching for work, not to mention the millions that have given up, congress must imement policies that encourage new jobs, not hinder them. this legislation will rein in the activist nlrb and we affirm protections workers and job creators have received for decades. thank you, mr. chairman, and i

yield back the balance of my time. the chair: the gentlelady from alabama yields back her time. the gentleman from minnesota reserves. the gentleman from california is recognized. mr. miller: i yield two minutes to the gentlewoman from california, ms. woolsey, the the ranking subcommittee member of the committee. the chair: the gentlelady is recognized for two minutes. ms. woolsey: h.r. 3094, the so-called work force democracy and fairness act, what a great title for legislation that assaults theajority's year-long war against unions, against workers and the national labor relations board. this is just the latest of that, and they gave it this wonderful title. since they took control of this body in january, my colleagues on the other side of the aisle have been doing everything in their power to stack the deck begins labor unions and those who aspire to join them. seemingly, the bills they bring to the floor are designed to make life easier for the

corporate special interests and, as usual, hard-earned workers who just want a fair shake. curious, since the labor movement is the most powerful force for economic security and upper mobility that we have in this cntry and unions are the reason there is a strong middle class in the united states of america that they would want to attack it. we need to remove obstacles to union elections and we need to create ways for members to join unions, not prevent them from being union members. it's baffling to me that my republican friends from absolutely no plans to create any kind of job, but a carefully orchestrated plan to undermine the rights and protections of working people. instead of helping people who are reeling from this sluggish economy, they work to create distractions and to create

scapegoats. mr. speaker, workers deserve better than a government of, by and the wealthiest 1%. vote no on h.r. 3094. mr. chairman, i'd like to ask unanimous consent to enter a letter from the a.f.l. that expresses their views against this legislation. i'd like to enter their words into the record. the chair: the gentlelady's request will be covered by general leave and the time has expired by the gentleladyrom california. the gentleman from california reserves. the gentleman from minnesota is recognized. mr. kline: mr. chairman, i'm very pleased to yield to another member of the committee one minute, the gentleman from nevada, dr. heck. the chair: the gentleman from nevada is recognizedor one minute. mr. heck: thank you, mr. chairman. mr. chairman, i rise today to pose an important question to nevadans -- how would you feel about having only 10 days' notice that an election would

be held? that would give you only 10 days to research the candidates and find out where they stand on the issues 10 days to decide who best represents you, your voice, your values. and to my distinguished colleagues in this body, how do you think your constituents would react if we changed the law so that they had only 10 days' notice that an election would be held? it would be unconscionable for congress to advocate its responsibility and allow a board of unelected bureaucrats to do something that this by would never do itself. that's the debate today, whether or not congress allows the national labor relations board to radcally change the way union -- radically change the way union elections are governed with little or no input from those most affected by by this decision. i ask my colleagues to vote yes for the work force democracy and fairness act. i yield back the balance of my

time. the chair: the gentleman from vada yields back. the gentleman from minnesota reserves. the gentleman from california is recognized. mr. miller: two minutes to the gentleman from new jersey, mr. payne, a member of the committee. the chair: the gentleman from new jersey is recognized for two minutes. mr. payne: thank you, mr. chairman. the h.r. 3094, the work force democracy and fairness act, really as you know should be called the election prevention ac i'm grateful concerned about today's -- i'm gravely concerned about today's legislative proposal. current law says that workers should be able to associate with other units, enter any appropriate bargaining unit. this bill says that every worker should be in a bargaining unit unless proven otherwise. that's just the reverse of the way law should be. it allows employers to stuff the ballot boxes with workers who are not engaged in the

organizing drive in the first place, therefore, likely to vote no. it increases the chances that workers petition for an election will be rejected which the nlrb has proposed rule which is would eliminate loopholes in current law that allows unscrupulous employers to delay elections, frustrating workers' efforts to organize this would impose arbitrary delays and block those pending nlrb rules to eliminate avoidable delays. the fact of the matter is this bill encourages frivolous litigation. the original bill provides employers with an unqualitied right to raise a new issue at any point in the pre-election hearing in order to drag out the hearing. this would include any issue that may reasonably be expecd to impact the election's

outcome this bill does not limit these problems but states that these issues, even when immaterial to an election are considered relevant. based on this fact, a hearing could go on indefinite. that's what the purpose of this is furthermore pares could bring up issues such as economic conditions, unfair labor practices or other items not normally considered in hearings. this seems to require that the board must finish a request for review before any election can be directed. this will encourage employees to file requests, mr. chairman, i ask unanimous consent to add three letters into the record. the speaker pro tempore: the gentleman's -- the chair: the gentleman's request isovered under general leave. the gentleman's time has expired. the gentleman from california reserves, the gentleman from minnesota. mr. payne: may i have 15 seconds, mr. chairman. >> i yield the gentleman 15 seconds. the chair: the gentleman is recognized for 15 seconds.

mr. payne: i'd like to include in the record a letter from the national other space workers a letter from a building and construction trade, president mark ayers, an an -- a letter from the sciu's international president. yield back the balance of my time the gentleman continues to reserve. the gentleman is recognized. >> mr. chairman, i'd like to yield two minutes to another distinguished member of the committee, the gentleman from florida, mr. ross. the speaker pro tempore: the gentleman veck -- the chair: the gentleman veck niced for two minutes. mr. ross: thank you mr. chairman an thank you for bringing forth this most necessary legislation. i se in support of house resolution 3094. simply put the national labor relations board has lost all credibility. from its anti-american attack on boeing to its inability to

allow delta employees to choose their own labor future, the nlrb has become nothing more than a taxpayer funded big payer advocate. this act is just what it says it is, legislation that if passed will enshrine the rights of workers to both information and choice, two things my friends on the other side of the aisle believe in as well. what's truly sad is that taxpayers already living under the exploding debt are paying the salaries of nlrb attorneys and administrators to ship jobs overseas. the proposed rule requiring lech be held in as little as 1 days gives workers virtually no opportunity to inform themselves about their right, show how radical this nlrb has become, we must k ourselves when, in the history of this great republic, has shortening the time for an election been consideredore fair?

we hear members from the other side of the aisle saying even requiring some to show identification to vote is unfair and restrictive but drastically cutting short the time for an election is more fair? as if that was not radical enough, the decision on microunions overturns 30 years of successful precedent. for example, at retail stores, multiple labor unions could target and organize different groups of workers. department managers, stock clerks and security guards could form parate unions this will pit worker against worker and they'll spen more time working with unions than focusing on their jobs an business. the question we must ask is what are they so afraid of? the answer is, they are afraid of an american worker free to work hard and earn the fruits of that labor. they're afraid of the american worker given the right to choose their own future. i don't know about anyone else, but i trust the american worker to make the right decision. i don't trust the government.

i yield back the balance of m time. the speaker pro tempore: the gentleman from minnesota reserves. the gentleman from california is recognized. mr. miller: i yield two minutes to the gentleman, mr. kucinich. the speaker pro tempore: -- the chair: the gentleman is recognized. mr. kucinich: the right to organize is a fundamental right of society. workers' rights are human rights. this bill seeks to frustrate workers rights to an lech through attacking the national labor relations board. today, workers have to wait an average of 121 days to cast a bat lot in an election. 101 days to wait for union representation. how long should work verse to wait to be able to assert their fundamental rights in a democratic society, if we really believe in democracy? some of us believe that when a majority of workers want to be

able to have a union, they should be able to do so forthwith. we believe in government of the people. why, then, would corporations want to block or frustrate the right of workers to organize? i think it's obvious. when workers are organized they have the ability to be able to participate in being able to say what their wages are worth. this is about wages, it's about benefits, it's about workplace safety, about working conditions. workers' rights are human rights. this assault on the nlrb is translated into a fundamental assault on our democracy. if we belie in democracy, we believe in right to organize a right to collective bar geaning, a right to decent wages an benefit a right to a secure environment a right to workers to participate in a

secure environment. this is america, let's lift up the standard of workers, not attack it by making the day of their election and claiming a union farther and farther away, almost to the point of nullification. stand up for he american workers, defeat this bill. the chair: the gentleman from ohio yields back. the gentleman from california resevens. the gentleman from minnesota is recognized. mr. kline: i yield two minutes to the distinguished gentleman from virginia, mr. hurt. the chair: the gentleman is recognized for two minutes. mr. hurt: i rise in support of the bill offered by chairman kline and thank him for his leadership on this issue. we have seen a vast expansion in the size and scope of the fovet which has resulted in a suffering economy and job market and uriendly business environment for job creation and investment. a recent troubling example of the overreach is the national

labor relation board's rule making which would alter the procedures that govern union elections. this wouldo little more than empower big labor bosses by restricting employers from talking to employees in the process, preventing them gaining access to critical information necessary for their votes and diminishing the fundamental rights of employees and employers around the country this government intervention in the workplace is an attack on our economic freedom and will only provide more uncertainty in our economy at a time when we are struggling to recover. with far too many fifty district virginians and americans out of work we must put an end to arbitrary rule making that comprise the nlrb. we must provide our job creators the opportunity to hire and grow out the uncertainty caused by unnecessary an burden somebody government regulations. we must preserve the protections and freedoms that american workers deserve, allowing them to participate in a full an fair election

process. i urge my colleagues to support this important legislation and i yield back the balance of my time. the speaker pro tempore: the gentleman from virginia yields back. the gentleman from minnesota -- the chair: the gentleman from virginia yields back his time they feel gentleman from minnesota reserves. mr. miller: i yield one minute to ms. pelosi. the chair: the gentlelady is recognized. ms. pelosi: i thank the gentleman for yielding and for his leadership on behalf of working families and for bringing the opposition to this legislatio to the floor today. mr. speaker, and my colleagues, more than 75 years ago, president franklin roos vell signed a bill which created the national labor relations board and said he did so to give every worker the freedom of choice and action which is justly his. today we say which is justly his or hers. that was a very important moment for workers because it said that they could negotiate,

they could bargain collectively. giving great leverage to workers in our country. an it was necessary. the freedom of choice in action has rested at the core of a growing, thriving american work force. it has created the american middle class that has made our country great and is e back bone of our democracy. this legislation on the floor today undermines freedom of choice in action. it will weaken our middle class and again weaken oudemocracy. for months in wisconsin, ohio and other states nationwide, americans have seen republican governors and legislatures attack teachers, firefighters, and police officers and other publicer is vabts. and we've servants and we've seen american workers, union and nonunion alike, fight back, inspiring the nation. my colleagues on the other side

of the aisle have promoted many myths about what their misguided legislation that they're bringing forward today and how it will impact the national labor relations board. so i'd like to clarify a few facts. first, the bill -- this bill mandates delay. rather than minimizes it. it encourages frivolous litigation rather than discourages it. it convolutes and distort elections rather than simplifying them. simply put, this legislation would deny workers their right to a free and fair election to form a union. it adds extensive delay to the process as workers organize with the clear intention of, if my colleague, congressman george miller, the ranking member of the labor -- education and labor committee has said, wearing down workers so they give up fighting for a

better deal. it's an age-old tactic. it must be rejected. at a time when americans are demanding jobs and job growth, economic growth for our country, today's legislation is the lg -- wrong priority. we need to be solving the problem an challenge of creating jobs and not adding to the problems as this bill would do. there's a great deal of work to be done, reigniting the american dream. igniting the american dream is what franklin roosevelt did when he siped this bill and many other initiatives of that era. and they corrected many ills in our economy and our society and communities across the country in terms of fairness. fairness, an american value. so we want to reignite the american dream to build ladders of success for all who want to

work hard, play by the rules, remove obstacles to fuller participation in our economy so that many more workers can participate in america's prosperity. this is about, again, strengthening the middle class, the back bone of our democracy, instead this legislation will have the opposite effect of eroding rights and opportunity. i urge my colleagues to vote no. i yield back the mans of my time. the chair: the gentlelady from california yields back. the gentleman from california reserves. the gentleman from minnesota is recognized. mr. kline: can i inquire as to the time remaining on each side. the chair: the gentleman from minnesota has 13 1/2 minutes. and the gentleman from california has 14 3/4 minutes left. the gentleman from minnesota. mr. kline: i'll be submitting to the record this letter from

the polish democratic work force with 243 associations in support of this legislation. now i'm pleased to yield two minutes to another member of the committee, the distinguished gentleman from indiana, dr. brow shon. the chair: the gentleman's request is covered under general leave. the gentleman is recognized. mr. brew shon: the national -- >> the national labor relations board has had a bias in decision making. though this addresses several onerous rules i want to focus on one in particul. on august 1 of this year, the brd overturned decades of precedent with its decision in the health care case and by standing up to this we can stop an out of control agency from causing irreparable harm to

workers across the nation. mr. bucshon: they will no longer -- this will encourage unions to create the smallest so-called microunions possible and could result in employers having to negotiate with multiple units within their own business, and this undermines the workers' ability to think about whether to join a union and may potentially fracture the work force. h r. 3094 reinstates, i should say again, reinstates the decisional standard for derchg employees make up an appropriate bargaining unit. this bill is about fairness for workers and employers. it returns the board to the precedent that it has operated on for the last 20 to 30 years urn both republican and democratic administrations. returning to this precedent will provide certainty and clarity to workers and employers and it will undue --

dun do the biased behavior of the current board. i support this bill and urge my colleagues to do the same. i yield back the balance of my time. the chair: the gentleman yields back. the gentleman from minnesota resevens. the jell from calirnia is recognized. mr. miller: i yield two minutes to mr. holt. the speaker pro tempore: the gentleman is recognized for two minutes. mr. holt: i thank the gentleman. today the majority is showing the american public again that the majority doesn't think we have a jobs crisis in america. getting americans pack to work isot their top priority. getting the american economy back on track and creating jobs is my first, second, and third priority. and until the majority gets to work, we're not going to move this country forward. democrats remain committed to creating jobs immediately and expanding educational opportunity for all americans. and rather than bringing to the floor legislation to help create jobs, we're wasting time

with this attemptto undermine workest' right the right to organize, to have safe working conditions, fair wages, you know, on monday night, i had a town hall and not one person, not one, wanted to talk with me about the nlrb or its rule making. many wanted to talk about job creation. wanted to make sure we were investing in our children's education. i offered an amendment to this bill to help keep teachers in the children's classrooms. i offered a real solution to a real problem. not a special interest giveaway to big business. unfortunately, the majority blocked my amendment on procedural grounds. now acss the country, budget cuts and teacher layoffs forced schools to reduce days of the school year or cut classes in literacy or artsr music or physical education or increase class sizes or reduce library hours. my amendment would have invested in a work force -- in

our work force, my amendment would have supported nearly 400,000 education jobs. enough for states avoid harmful layoffs and rehire tens of thousands of teachers who lost their jobs over recren years. i heard from a student who said, teacher layoffs is a bad thing, he said. i had many oversized classes this year. our students don't get a second chance to achieve in school. our future depends on a well-educated work force. that's what we should be doing --ealing with today. my amendment would have supported our children, this bill ignores those pleas for help. the chair: the gentleman from minnesota is recognized. mr. kline: thank you, mr. chairman. i am pleased to yield to another distinguished member of the committee, four minutes, the gentleman from south carolina, mr. gowdy. the chair: the gentleman is reck thesed for four minutes.

mr. gowdy: thank you, mr. chairman. i want to thank chairman kline for his leadership on this and so many issues, other issues on the education work force committee. mr. chairman, when so many of our fellow citizens are looking for work, when so many of our fellow citizens want nothing more than to be able to meet their familiaral obligations and their obligations to the -- familyal obligations and their obligations to the demuent, -- community, when so many americans want nothing more than the most fundamental of all family values which a job and they look and they see that america is increasingly competing with other countries for work, it is no longer just competition among the states. we're competing with other countrie for work. and the nlrb continues to pursue an activist, politically motivated agenda, thwarting economic recovery and continuing to place our companies at a competitive disadvantage worldwide and, mr. chairman,

virtually everyone is family with the most glaring example of nlrb overreach and union pandering whicis the complaint against boeing, despite not a single example of a job being lost in washington state, despite not a single example of a worker losing a single benefit or right in washington state, the nlrb sued boeing seeking to have boeing close its south carolina facility, mothballing a $1 billion facility, displacing 1,000 workers and return the wo to washington state. and then, mr. chairman, they had the unmitigated temerity, as we recently learned, to joke about it in emails. to joke about a competitor called airbus which is boeing's number one competitor. wanting work and not getting it is not a laughing matter. boeing is exhibit a. among the evidentry reasons that

the nlrb has overreached its statutory mission, but it is not the only piece of evidence, mr. chairman. currently union elections take place on average within 31 days of the filing of an election petition. additionally unions are victorious more often than not when there is an election, but, mr. chairman, that's not good enough. the nlrb wants more. so theproposed sweeping changes to the election process, shifting the balance of power even further towards union seeking employees by promoting rush elections and ruling that elections can take place in as little as seven to 10 days, the board severely limits e opportunity for workers to hear all sides of an issue and they can inform -- and make an informed decision. additionally employers would only have seven days to retain legal council and decipher the complex labyrinth of federal labor law before presenting their case before an nlrb hearing officer. so education work force chairman

john kline smartly introduced h.r. 3094, the work force democracy and fairness act, to simply, mr. chairman, level the playing field. this legislation requires no union election occur less than 35 days, thus granting all parties the ability to present their arguments and ensuring works have the ability to reach an informed decision. h.r. 3094 acknowledging that full and complete -- acknowledges that full and complete information is treasured when employees are contemplating how they will vote. some unions have already endorsed president obama in an election that is well nihg a year offer off but -- nigh a year off but somehow 31 days is too long for employers in an election that's ever bit as important them. the hypocrisy and blind advocacy has to stop, mr. chairman. the purpose of the nlra is to balance the rigs of employers,

employees and the general public. the nlra is not calculated to drive up union membership because they're a loyal constituency for the democrat party. because the nlrb, through its filings and proposed rules and regulations, has lost all pretebs of -- pretens of objectivity and bor issues, pieces of legislation like this one are necessary. i yield back. the chair: the gentleman yields back the balance of hitime. the gentleman from minnesota reserves. the gentleman from california is recognized. >> i yield two minutes to the gentlewoman from connecticut, ms. delauro. the chair: the genewoman from connecticut is recognized for two minutes. ms. delauro: mr. speaker, this legislation will delay workers' attempts to uniize and will deny -- unionize and deny americans their rights to bargain collectively. in the next three weeks we have jobs legislation to consider, middle class tax cuts and unemployment benefits to extend. a 2012 budget to pass.

the labor education, health and human services appropriations subcommittee has not even seen a bill yet. and yet just as they have all year long, the majority has chosen to waste precious time, time that we should be spending on the people's business, to continue their misguided war against workers' rights. once again the majority's put forward a bill that has no other purpose than to roll back hard-won gains by american workers and erode the right of collective bargaining in this untry. the legislation before us attempts to deny the right to form a crune by imposing excessive delays on the process, stifling the flow of information to workers and looking the other way while workers' rights are being violated. how long is this majority going to persist in this wrong-headed crusade against hardworking american men and women? the same hardworking men and women who built the middle class of this nation. mr. speaker, last month the c.b.o. found that wages have

stagnated in this country and medium income has fallen in recent team, even as the income of the top 1% has tripled. it is no coinciden that this has happened. while union membership has decreased. but the majority persists in trying to squeeze middle class workers and accelerate this race to the bottom. this is not the american way and it is not what the american people want. in ohio last month they rejected yet another republican attempt to eviscerate the right to collective bargaining. it is timeo stop these attacks on basic american rights, it's time to roll up our sleeves and get to work on creating jobs, reducing the deficit and restoring economic growth to this nation. sano to this legislation. the chair: t gentlewoman's time has expired. the gentleman from california reserves. the gentleman from minnesota is recognized. mr. kline: thank you, mr. chairman. i yield to another member of the committee, two minutes, e distinguished gentleman from

pennsylvania, mr. platts. the chair: t gentleman from pennsylvania is recognized for two minutes. mr. platts: thank you, mr. chairman. i appreciate the gentleman yielding. i co-sponsored and rise today in support of house of representatives bill 3094 because it aims to restore key protections to the american workplace. protections for both workers and their employers from overreach by the national labor relations board. this legislation intends to protect job growth by deterring harmful nlrb regulations. the nlrb's recent notice of proposed rule making wod significantly alter union procedures, thus undermining the rights of employers and employees alike. the proposed rules will unably shorten the time between the filing of a petition and the election date which will limit the opportunity for a full hearing of contested issues, including the appropriate bargaining unit, voter eltjibblet and election misconduct. i share the concerns of my constituents regarding the short and -- shooteren -- shortened time frame for elections and the potential it may have on an

employers' ability to communicate with his or her own employees regarding unionization. h.r. 3094 aims to ensure that employers and employees arable to participate in a fair union election process. by providing 14 days for employers to prepare their case to present before the nlrb, providing employees with at least 35 days to deliberate over the pros and cons of unionizing prior to voting on this issue. discouraging the practice of ambush elections and guaranteeing the rig of employers to discuss the pros and cons. this legislation is not about whether employees should have the right to unionize. as a former teamster member, i certaiy strongly support that right. this legislation is abouting employees a fair and deliberate opportunity to make that decision, one of the most important decions they'll make in their life because it deals with their livelihood.

outside of family matters and health concerns, deciding where you work and in what type of environment in which you work is going to be probably more important than anything else you do related to your career. what this legislation says is, we think employees should have a fair opportunity to make that decision. i support this legislation and urge a yes vote. i yield back. the chair: the gentleman yields back the balance of his time. the gentleman from minnesota reserves. the gentleman from california is recognized. mr. miller: i yield to the gentlewoman fr california, ms. waters. the chair: the gentlewoman is recognized. ms. waters: i rise in strong opposition to the work force democracy and fairness act. this bill would severely undermine workers' rights to organize and if implemented will eventually silence and end unions as we know them. congressman george miller was create in -- correct in referring to this bill as the election prevention act. h.r. 3094 would require the national labor relations board to hear trivial appeals from

companiesn order to stop elections. this is an outright assault on middle class workers and the families they support. the middle class is in decline. a c.b.o. report found that between 1979 and 2007 the top 1% of earners experienced income growth of 275%, that's the top 1%. while the middle income earners only saw 40% in growth over the same period. statistics like these are startling and pay a dis-- paint a distinct picture of this country as one that is quickly evolving into a two-teared society with no room at the top at all for the middle class. the work force democracy and fairness act is nothing more than an outright assault on the middle class. if this misguided and dangerous legislation is passed, you will see an even more rapid decline of the middle class in our country. i urge all members of the house

to rebuke this misguided legislation and instead focus on polici that facilitate job growth. i yield back the balance of my time. the chair: the gentlewoman's time has expired. the gentlemafrom california reserves. the gentleman from minnesota is recognized. mr. kline: mr. chairman, again, may i ask how much time is remaining? the chair: the gentleman from minnesota has six minutes remaining. and the gentleman from california has 9 3/4 minutes remaining. mr. kline: i have two speakers which may or may not arrive so i will be prepared to close and i'll reserve. mr. miller: i'll yield to the minorityhip two minutes. the chair: the gentleman from maryland is recognized for two minutes. mr. hoyer: ihank the gentleman for yielding. mr. speaker, i rise in strong opposition to this misnamed bill

which would promote neither democracy nor fairness in the workplace. now, i have just been on this floor a few minutes but it's ironic that i've heard speaker after speaker in favor of this bill but who vote consistently against working men and women's right to organize and bargai collectively. ironic perhaps. the right of workers to organize and bargain collectively for better and fairer conditions has been protected by ou laws since the era of the new deal. which was opposed by so many. this legislation is part of an agenda frankly that the republican party continues to pursue which no economist believes creates jobs in the coming year. this bill before us won't do

anything to help the economy or create jobs, period. and it places obstacles in front of workers seeking to exercise their right to organize. now want to poi out to my friends that interestingly enough in terms of trying to protect elections, there's all about -- you can't have an election before but there's nothing in this legislation you have to have an election by. that would perhaps be more critical. if said not sooner than this, but not later than this. that would show that you really wanted to pursue elections for working men and women so they could organize and bargain collective for pay and benefits and working conditions. but it doesn't say that. it says, you simply can't have it before. it never says you have to have it. it never says you can't delay it by suit after suit after suit. it never says you've got to get

the issue, it never says you've got to get the employees the right by a certain date. i ask for an additional minute. the chair: the gentleman from marynd is recognized for an additional minute. mr. hoyer: this bill before us won't do anything to help the can economy or create jobs, as i said. i continue to have the strongest faith in the american worker, that they are the most talented and most productive in the world. we should not be rolling back their protections. instead we should focus on helping to get more americans back to work and as for the nlrb , the real trauma is it is now a pro-worker and employer nlrb as opposed to simply aro-employer nlrb. that's the problem you have. the courts sought to ensure equal treatment. the nlrb ought to ensure equal

treatment. it has not been doing that for some period of time. and now, in my view, it is. god bless them. that's what they should do. employers and employees ugget to get a fair shake and a fair election. and i agree with that premise. timing is obviously of concern to both parties. i would hope that we would defeat this bill and then if we want to talk about assuring elections, we protect democracy and protect workers. i thank the gentleman for yielng his time. the chair: the gentleman's time has expired. the gentleman from minnesota. mr. kline: i reserve. the chair: the gentleman from california. mr. miller: i yield one minute to the gentleman from massachusetts, mr. lynch. the speaker pro tempore: the gentleman veck niced. mr. lynch: thank you. i thank the gentleman for yielding. i come before you as an iron worker for 18 years before

coming to congress. i prack disease an attorney for 18 years before coming to congress. i practiced in front of the national labor relations board. i have heard time and time again by my colleagues that the nlrb, national labor relations board is an advocate for unionism, an advocate for big labor, it's nothing more than overreaching and trying to create unions. for those who lee that i ask you to look at the american work force. what percentage, since the nlrb is creating these unions and is overreaching, what percent amming of the american work force is working under a union agreement right now? the answer is 11%. so if those guys are in the tank, the nlrb is in the tank for creating unions, they're batting about .110. they're doing a lousy job. i've heard a lot about 31 days

for an average election. that's where the union and employer agree it's 31 days. if the union and company don't agree it's over 31 days. i urge my colleagues to vote against this bill. this is an attack on the middle class in america. we need to put people to work instead. thank you. the chair: the gentleman's time has expired. the gentleman from minnesota continues to reserve. the gentleman from california is recognized. the gentleman from california is recognized. mr. miller: i yield one minute to the gentleman from missouri, mr. carnahan. the chair: the gentleman is recognized for one minute. mr. carnahan: thank you, mr. speaker, why aren't we talking about jobs today?

we're here at the floor to talk about this bill, this so-called work force democracy fairness act. not surprisingly, it's neither democratic nor fair. it is, in fact a blatant attack on workers' right the latest in a long line of republican assaults on workers this time the right wing is attacking the very right to organize. labor unions helped create the middle cla and build the american dream. they help establish f all american workers much-needed protections and bargaining rights for wages and work force conditions. this deal would undo that progress. this anti-worker bill would so en-- empower employers to engage in anti-union campaigns and weaken the ability to protect people at work. just as voters stood together to stop the republican assault on workers, today i stand here on the floor against yet another assault on working families.

when will we get beyond another republican sideshow and get back to talking about jobs? the chair: the jet's time has expired. -- the gentleman's time has expyred. the geleman from miesota continues to reserve. the gentleman from california. mr. miller: the gentleman from new york, mr. crowley, one minute. the chair: the gentleman is recognized for one minute. mr. crowley: thank you, mr. speaker. i rise in strong opposition to this so-called work force democracy and fairness act. the sponsor of this bill recently said, and i quote if we remove an obstacle standing in a way of a stronger, more competitive work force. i find that puzzling. this deal would make the organization process longer, less efficient and more litigious. it would drag out leches so the deck is stacked even higher against american workers. but the truth is unions have been at the forefront of workers' rights f over a century in the united states. they have been instrumental in

achieving the 40-hour work week, safer workplaces and a guarantee for injuries sustain odd the job. they havereated an entire generation of middle class meshes an helped build the most prosperous country in the world today. i think we all agree that unions have made the american work force stronger. so how can legislation that makes it harder to form a union strengthen the american work force? if someone has an answer i'd like to know. if not, let's get bacto the job of creating jobs for the american people, strengthening the economy and creating more jobs for these people. i urge members to vote no on this bill and with that, i yield back the balance of my time. the speaker pro tempore: the gentleman yields back. the gentleman from minnesota continues to reserve. the gentleman from minnesota has six minutes. the gentleman from california has 3 3/4 minutes. he is recognized. mr. miller: i yield one minute to the gentleman from minnesota, mr. ellison. the chair: the gentleman is regnized for one minute. mr. ellison: i ask unanimous consent to submit this letter for the record from the

transportation union. the chair: the gentleman's request is granted under general leave. the gentleman is recognized. mr. ellison: mr. speaker, this particular piece of legislation that uns mines unions,makes it more difficult to organize and generally frustrates american working men and women to organize on the job takes place just a few weeks before the republican majority was trying to take down the clean air act in the e.p.a. when you look at the amican -- the republican job approach, it seems to me their argument seems to be that workers and people who want to breathe are the problem with the american economy. people who want to drink clean water and breathe clean air and people who want to have some rights on the job, they're the reason the american economy doesn't work. well that happens to be about 99% of us, mr. speaker.

and i hope that as people are watching this debate on this floor today, that they are taking careful note of who is on the side of themerican worker, who son the side of amerans trying to breathe and have clean air, and what in the world does getting rid of the clean air act and gutting unions have to do with making american jobs in the fact is, the republican majority is abandoning their responsibility to create jobs and i hope the american worker is watching today. the chair: the gentleman's time has expired. the gentleman from minnesota continues to reserve. the gentleman from california is recognized. mr. miller: the gentleman only has himself to close? mr. kline: that appears to be the case. mr. miller: i'm the only speaker left. e chair: the gentleman has 2 3/4 minutes remaining. mr. miller: 2 3/4. ok if anybody thinks this is

just a technical change, let's understand what has gone on since republicans took control of the house. first effort, they cut $50 million out of the nlrb account. then there was an amendment on this floor to try and zero out the money for th nlrb. then they passed a rule that said that you could retaliate against rkers and you could move work away from workers, outsource it, they assigned the work to outsource work to retaliate against workers. now we have the effort to try and to preventlections from taking place. this is a systematic effort, joined by a number of states and the republicans in this congress to take away the rights of workers at the workplace in america. the basic rights that have built the middle class. while they've continued to campaign against the nlrb thank god the nlrb has conned to wo. we see today a settlement has

been reached in the boeing case and you don't get to retaliate against workers. the new 737 work will go to washington, the 787 will continue to go to south carolina. the nlrb worked thatgreement out between employer and employ. let's remember boeing's on the record they didn't support that legislation. that was put there in behalf of their name. just a few minutes ago, the nlrb voted on a compromise rule dealing with leches. that compromise rule hopefully will now become a permanent rule and that will go forward. that's what the nlr bmbing does. it works out arrangements between employers and employees over issues about how the american workplace will be managed. but it does not strip away the basic rights of workers to choose to join the union. it does not allow you to retaliate against the union. it does not alw you to delay elections or at a point where

you beat the union into submission, people get dispirited or move away, it doesn't allow that. that's the basic labor law of this country. so today, the nlrb, working with employers and employee, have reaffirmed that principle. today on this house they continue the effort to try to strip workersf their rights. they continue the effort in light of the evidence that these things get word out in the workace. yes these are contentious, they're big issues, but we have a vehicle, that's 75 years old, that has worked well on behalf of this economy. not only did it build the middle class in this country, it built one of the largest economies, because we have the most productive workers. the most productive workers in the history of the world. industry after industry after industry. however you measure it. why aren't our steelworkers competitive with china? because our plants are cost competitive on tons of steel but when you manipulate the currency our people can't win.

but our workers continue to be there every day and the nlrb will continue to be there every day for employers and employees to settle their differences. the chair: the gentleman's time has expired. the gentleman from minnesota is recognized. . kline: thank you, mr. chairman. i yield myself as much time as i may consume, the remainder of think time. the chair: the gentleman is recognized. mr. kline: l's clear up a few things today. we heard in if -- in this debate, it's interesting, we clearly have different views, no question about it. we have heard repeatedly that this bill strips workers of their rights. sometimes my colleagues confuse workers with big labor leaders. this bill in fact protects workers' rights. union workers' rights, nonunion workers' rights. the pr posed regulations which are apparently under modification as we speak from the nlrb were in fact an attack on workers' rights. a demand that more personal

information be provided union organizers whether or not the workers approved that. rinking the amount of time that workers mig have a decision, to make a decision on one of the most important aspects of their life to as little as 10 days. this bill protects workers' rights, makes sure they have time to make this important decision. we've heard today that bargaining units would be gerrymandered by employers. in fact, this bill puts us back to the standard that has been in place for decades. to make sure that workplaces aren't fractured and fragmented and you have worker against worker. worker against employer. making it harder for empyers to run an eective business. making it harder for them to have confidence to hire americans.

we've been told that we are wasting time today, that we ought to be having a jobs bill, which apparently means spending more borrowed money. we're already borrowing 42 cents on every dollar, mr. chairman, that we're spending now and yet apparently you can't create a job in this country unless the goverent does it with borrowed money. we disagree. we think -- we believe that we have been moving legislation in this house which will in fact help american job creators put americans back to work. one of the obstles is confusion. it's uncertainty. it's worry about the regulatory climate an what's coming down the path. the president of the united states has said this economy needs a jolt, mr. chairman. i disagree. it needs certainty. it needs redictability. employers, employees, consumers need confidence in the future. they d't need to be jerked. the distinguished minority whip said the nlrb ought to be fair

he said employers and employees ought to get a fair election. i couldn't agree more. employers and employees ought to have a fair shake. they ought to get a fair election. that's what this bill does. so the choice today is pretty simple. if you support an employer's right to speak to his or her employees during an organizing campaign, then support the work force democracy and fairness act. if you support a worker's right to make an informed decision in a union election, support the work force democracy and fairne act. if you support giving workers a say in the personal information, the personal information, mr. chairman, available to union leaders, then support the work force democracy and fairness act and if you support reining in an activist nlrb and reaffirming congress' responsibility to write the law, then support the work force democracy and fairness act. i urge my colleagues to stand by our workers and their

employers by >> britain has evacuated all embassy staff in iran after protesters stand the embassy compound in tehran. a senate panel looks at u.s. policy towards iran. live coverage from the senate foreign relations committee starts at 10:00 a.m. eastern on c-span3. later in the day, executives from fannie mae and freddie mac will take questions at an oversight hearing all along with the acting director of the federal housing finance agency. that is live at 2:00 p.m. eastern, also on c-span3. >> president obama continued to push his jobs plan with the stop in scranton, pennsylvania.

the president called on republicans in congress to extend payroll tax cuts for workers and small businesses. those tax cuts are set to expire at the end of this year. [applause] >>hello, scranton. thank you. it is good to be back in scranton. go, knights.

it is good to be here. thank you, principal schaeffer, for letting us hold this little assembly here at the high school. the principal was bragging about both the basketball team and the football team. i understand they're right up there? all right. thank you, donna, for the wonderful invitation. we had a chance to visit in the festas' living room, and just a wonderful family, and their kids are doing great. so i'm really, really proud to be with all of you. >> can you come to my house? >> what did she say? you want -- next time, your house. all right?

now, i will say, donna put out some really good cookies. so i'm just saying. all right. now, i also want to bring greetings from somebody you guys know pretty well - a guy named joe biden. joe is in iraq as we speak, and he's visiting with our brave men and women in uniform, thanking them for their service. and part of the reason he's going now is because, pretty soon, we'll all get a chance to say thank you. this holiday season is going to be a season of homecomings, because by the end of december, all of our troops are going to be out of iraq. they're going to be back home.

now, i mention joe, first of all, because he loves scranton. he was born here in scranton. he spent his early years here in scranton. this town helped make him who he is. this is a town where he and so many of you grew up with a faith in an america where hard work matters. where responsibility matters. where if you stay true to those things, you can get ahead. where no matter who you are, no matter what you look like - whether you own a factory or you work on the factory floor - america is a place where you can make it if you try. make it if you try.