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[Congressional Record Volume 141, Number 73 (Thursday, May 4, 1995)]
[Senate]
[Pages S6165-S6168]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

         UNITED STATES ENRICHMENT CORPORATION PRIVATIZATION ACT

  Mr. DOMENICI. Mr. President, I want to speak about a bill I 
introduced yesterday and I did not get a chance to speak on it. It has 
been introduced and has been referred. It is now known as S. 755. It 
has a very uninteresting caption and name: United States Enrichment 
Corporation Privatization Act.
  Actually, while that does not sound like much, we hear a lot these 
days about Russia, Iran, and Russian scientists having to find some way 
to earn a living. We hear a lot about the fact that Russia has a very 
significant amount of enriched uranium and that we have agreed, in a 
sense, to buy it.
  Now we find ourselves kind of in a quagmire. Our own trade laws do 
not let us buy and resell the material because that is dumping. So we 
have a $4 billion commercial transaction going and the Russians are 
saying, ``Fine, we made a deal, let's do it.''
 And so we have an entity here, the U.S. Enrichment Corporation, 
currently in existence. It is Government owned, and thus it is 
corporate only in the sense that we call it a corporation. The U.S. 
Enrichment Corporation, when we sell it--and what we propose here has 
been cleared by and looked at by a lot of marketplace people--we 
believe it will generate $1.5 billion for the Treasury of the United 
States, when we take the existing Government corporation and put it on 
the market, make it a corporation.

  One of the most difficult issues facing this enrichment corporation 
and the uranium industry as a whole is how uranium from the Soviet 
Union is allowed to enter the United States market. Currently, the 
Department of Commerce enforces a suspension agreement that limits the 
amount of uranium we can import from the Soviet Union. The suspension 
agreement enforces U.S. trade laws. Obviously, a straight purchase and 
resale into the U.S. market would result in dumping. So it will not 
work.
  In 1993, Russia and the United States signed an agreement under which 
the United States would purchase up to $4 billion worth of natural 
uranium derived from highly enriched uranium from Soviet nuclear 
weapons. However, as I indicated, the U.S. trade law prevents that 
natural uranium from being sold in the United States. The enrichment 
corporation is responsible, nonetheless, for implementing the Russian 
agreement. As a result, the $4 billion obligation falls squarely on the 
enrichment corporation, the one we now have, the Government 
corporation, because the enrichment corporation is prevented from 
selling the natural uranium into the U.S. market, which would be 
illegal since the material is below market price. As a result, the 
United States Enrichment Corporation cannot pay the Russians. In turn, 
the Russians argue that they are being shortchanged $4 billion. I do 
not think one can blame them for that. We have an agreement. But our 
enrichment corporation cannot buy it, because if they buy it, they 
cannot use it.
  So this legislation solves that problem by enabling the creation of a 
futures market for natural uranium derived from the Russian agreement. 
The material could only enter the U.S. market in a controlled manner 
starting in 2002. Thus, it is not inconsistent with our trade laws.
  So this proposal preserves the United States trade commitment, 
protects the United States uranium industry from unfair dumping, and 
encourages Russia's important work of dismantling nuclear weapons to 
continue. This proposal enables the Russians to be able to pay the 
people that are doing the dismantlement work that with some of the 
fruits of the disarmament, namely the revenue from the natural uranium. 
The money would provide the cash flow necessary to keep the Russian 
minatom employees working to dismantle the Russian nuclear capability 
and, in turn, the Russians might not be so adamant about selling 
reactors to Iran for a billion dollars.
  So in a very real way, the notion of privatization, which is given 
sort of a rebirth because of the last election, finds itself settling 
in on this situation. I happen to have the privilege of chairing the 
Subcommittee on Energy Research and Development that has this as one of 
its responsibilities. So the idea of privatizing it fell on our 
subcommittee, and with the work of some experts and some really 
exciting ideas encapsulated in this bill, we may indeed retain the 
enrichment corporation, that is privately owned, privately run, that 
can indeed make money, and we will succesfully implement the Russian 
agreement using the futures approach. I do not think we have seen a 
nicer fit and match than this. In the meantime, we pick up $1.5 billion 
for the U.S. Treasury.
  Now, obviously, there will be a lot of questions about this, and we 
are understanding of that. We hope that within a month, as soon as we 
get the budget behind us a little bit here, we can have some hearings 
on this and get it to the floor this year. We think it is an exciting 
idea of privatization which accomplishes so many good things at one 
time that we want to move full speed ahead and see if we cannot get it 
done. I have good cosponsors. I invite other Senators to take a look. 
Mr. Ford is a cosponsor. He is ranking member of the subcommittee. We 
have Senators Johnston, Campbell, Thomas, and Simpson.
  I am sure we will have others as soon as they understand it. I look 
for some of those who work in foreign relations and are worried about 
Iran and the growing relationships of a monetary nature between Iran 
and Russia, I look to them to analyze this, and perhaps they can see 
fit to join us.
  I yield the floor.
  Mr. KERRY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Nebraska is recognized.
  Mr. KERREY. Mr. President, I come to the floor--and I listened with 
great interest earlier to the majority leader, the distinguished 
Senator from Kansas, talking about a letter that he and the Speaker of 
the House have written to the President asking for some bipartisan 
cooperation having to do with Medicare.
  Mr. President, for 12 years when we had a Republican President, any 
time anyone would say, gee, how come Ronald Reagan does not submit a 
balanced budget, or George Bush does not, the standard response that 
would come is--mostly, I must say, from Republicans in defense of their 
Republican President--they would say, ``Gee, the President does not 
spend any money, Congress spends the money.'' I must say, the 
Republican defense is accurate. Congress does spend the money. For us 
to say, gee, the President has the responsibility for spending the 
money is inaccurate. It is the Congress of the United States of America 
that passes laws that determine how much money we are going to collect 
and in what manner we are going to collect it from the American people 
and how we are going to allocate that money across a whole range of 
programs.
  In fact, the Budget Enforcement Act requires the Congress to produce 
a budget resolution by the 15th of April, which is several weeks past.
  Mr. President, if the majority leader wants to get a bipartisan 
movement to do something about deficit reduction, there are a number of 
us on this side of the aisle who are all too willing to do exactly 
that. It seems to me that is what we need. If we are going to get 
movement, it ought to be movement inside of the U.S. Congress. There is 
a ferocious debate. There are ideological differences. The biggest task 
that faces us is that deficit reduction is tough. The problem with 
Medicare is not caused by mean and nasty Republicans or mean and 
liberal Democrats; it is caused by demographics and technology.
  The good news is that we are living longer. The bad news is that it 
is getting more and more expensive for us to pay for the health care 
for those where we have made a commitment. If you think it is bad over 
the next 4, 5 years, you ought to see what the entitlement commission 
says this looks like when my generation begins to retire. This thing 
goes clear off the charts after the 
[[Page S6166]] year 2008. So the insolvency of the year 2002 forecast 
by the trustees is only the tip of the iceberg, Mr. President.
  Deficit reduction is difficult precisely because it forces us to make 
tough choices. This Congress needs to get about the business of doing 
that. I was disappointed when the President's budget did not address 
the issue of entitlements. Our Presidential commission worked for an 
entire year. We made recommendations to the President to try to do 
something. But I think the President made a calculated judgment. He has 
to say, I have a Republican Congress and I had a 1993 deficit reduction 
act and did not get a single Republican to vote for it. In fact, part 
of the Contract With America promises to take the increase in taxes on 
a small number of Social Security beneficiaries, about 15 percent, 
reduce that tax which reduces the flow in Medicare and
 makes the problem worse. For that and other reasons, perhaps the 
President decided not to address the issue of entitlements. We know 
what we need to do in this Congress.

  I am very much concerned that this thing is going to degenerate into 
merely an attempt by Republicans to say, ``No, we are right and the 
Democrats are wrong,'' or the Democrats saying, ``No, we are right and 
the Republicans are wrong.''
  For Members to do that for very much longer, Mr. President, maybe we 
can survive for a week or two or three with partisan blasts back and 
forth across the bow, but at some point we have a lot of educating, a 
lot of explaining, and a lot of leading to do.
  I spoke last week to the National Press Club and unfortunately the 
answers that I gave to some questions afterwards got most of the 
attention. But at the heart of my message is that in deficit reduction, 
there is not a free lunch. Deficit reduction is not something that we 
are doing just to seek political advantage or curry favor with the 
voters, because the voters want deficit reduction. Deficit reduction 
has a positive effect upon our economy because it increases savings.
  The majority leader indicated we do not need to do anything with 
Social Security. With great respect, I disagree. I believe Social 
Security also needs to be reformed, because unlike the common 
perception of Social Security, Social Security itself is not a savings 
program.
  I inform anyone who might be listening to this right now that Social 
Security is a commitment on the part of those generations that are in 
the work force to allow themselves to be taxed at a fixed percentage of 
their wages, the money going to those generations that are out of the 
work force, who are retired.
  The program started off as a 1-percent tax on wages. The retirement 
age was 6 years after normal life expectancy when the program started. 
Today, it is 12 percent of our wages. And 12 percent of our wages, 
promised to pay beginning in the year 65, which is 11 years this side 
of normal life expectancy.
  It is a demographic problem, Mr. President. I appreciate the majority 
leader saying we do not need to address it because we have enough money 
coming in, but do not tell that to a 20-year-old, a 30-year-old, or a 
40-year-old.
  We had Director Rivlin before the Treasury Postal Subcommittee on 
Appropriations this afternoon, and I asked her about the deletion of 
intergenerational accounting in last year's budget. She expects the 
report to come out.
  My effective tax rate over the course of my lifetime is about 34 
percent--my generation. But the generation right behind, if we do not 
take action with Social Security and with Medicare relatively quickly, 
they are looking at an effective tax rates in excess of 80 percent--in 
excess of 80 percent--in an economic environment where their lives are 
apt to be more difficult to begin with.
  I believe what is needed is for Members of Congress to come and say, 
OK, we will fire a few shots across the bow here at Democrats, pointing 
out that Republicans, for 12 years when a Republican President was in 
the White House, said it was Congress' responsibility. Now that we have 
a Democrat in the White House they are not looking across the aisle and 
saying, as Congress we should fix it. They sent a letter to the 
President and said, ``How come you are not doing something about 
this?''
  I believe it is our responsibility under the Budget Enforcement Act 
to deal with this budget problem, and it is going to be tough. I note 
with great alarm a poll--in fact it has been distributed not just to 
Democrats but to Republicans as well, and may, in fact, have 
contributed not just to the President's address to his Conference on 
Aging, but to a remarkable address on the part of the Speaker of the 
House, going to the seniors coalition. He got several standing 
ovations, I might point out.
  Why would he not? He made it sound like the Medicare solution is 
easy. ``We will give seniors choices. We will let you keep the savings 
of 10 percent. If you find waste, fraud and abuse, it will be easy. We 
do not have it get Medicare all tied up in that nasty old budget 
deficit debate, we will move it aside, and it is all going to get real 
easy.''
  It is not easy. We either ask Americans to pay more or we give them 
less, or some combination of the two. Or we turn and honestly say to 
our kids that their effective tax rates will be higher. It will not be 
15 percent of wages. That is what it is today. But if we do not take 
action in the next couple of years, that tax rate will be 20 percent. 
Or they will have to look to their parents and cut their benefits 
enormously. Time is on our side right now, Mr. President, but it is not 
going to be on our side for very much longer.
  I genuinely hope that after we fired our few little political rounds 
here that the Democrats and the Republicans can, in fact, get together. 
We are the ones that by law have the responsibility for passing not 
only authorizing legislation but appropriation legislation and we have 
to change our laws.
  I was very alarmed to read in the newspaper this polling data that 
shows that 45 percent of the American people would not vote for any 
representative who voted to reduce the increases in Medicare. Fifteen 
percent would vote for them, if they did.
  I note again in Gerald Seib's piece in the Wall Street Journal, I 
believe yesterday, saying that a full 48 percent of the American people 
think that we are not spending enough on seniors, 48 percent.
  If we think that is greedy seniors, it is not. Only 34 percent of the 
people over 65 say we are not spending enough. It is people 18 to 34, 
by over 50 percent. Less than 5 percent say we spend too much.
  That is not what our budget shows, Mr. President, whether it is at 
the State or Federal level. No one who seriously examines our budget 
believes that the problem is we are not spending enough on people over 
the age of 65. That is not the problem we face.
  I sincerely hope--I must say it may require me to do more than hope. 
I may have to raise my voice and do a lot of praying before we can 
bridge the rhetorical gap that divides the Republicans and Democrats on 
the Senate floor. I think there is a bipartisan group that is willing 
to come to the American people and begin by simply saying ``This is the 
truth,'' not hyperventilate and say things that sound like we are on 
the side of the angels and the other side is on the side of devil, but 
just say, ``This is the truth.''
  Look at the numbers. We do not fix this thing by getting rid of 
waste, fraud, and abuse. We will not fix this thing by sort of 
tinkering at the edge and say, ``I will give you choice. We will put it 
off into managed care.'' That is not going to work.
  We either accept responsibilities that we have as citizens to say 
that if we ask for something we will pay for it. And we are not going 
to ask for any subsidy that we neither need or deserve. That is part of 
the problem now.
  We have an awful lot of people in America, whether corporations or 
individuals, that do not need subsidies and we are giving them 
subsidies. They make a good case for it for social or economic reasons, 
and we shovel the money out and find ourselves when it comes time to 
taking care of people who need it, we are woefully short of either the 
resources of trying to do anything.
  I am down here right now to offer a constructive engagement to the 
majority leader saying that this is not the President's problem. This 
is not his 
[[Page S6167]] fault. The President of the United States submits his 
budget. I was critical of it for leaving entitlements out and not doing 
the intergenerational accounting, but by law it is the Congress of the 
United States of America that must make these decisions.
  We are now almost 4 weeks late, according to the Budget Enforcement 
Act, of coming up with a budget resolution. I trust that when the 
distinguished chairman of the Budget Committee, the Senator from New 
Mexico comes up with a budget, that he will need Democrats on this 
Senate floor to come with him and say, ``We will join to make an effort 
to go out and explain it to the American people.''
  I will say what my price is, Mr. President, so it can be clear. I do 
not want anybody saying, ``I wonder what Kerrey wants?'' We will not do 
a $300 billion, 7-year tax cut. That is for openers. That is my price. 
Want to negotiate a bipartisan fashion? Have to give the $300 billion 
tax cut? That is nonsense. What kind of nonsense is that? Give up $300 
billion?
  Only yourself to blame when people get up and say, ``Gee, $300 
billion tax cut and $300 billion Medicare cut. Aren't you paying with 
Medicare for the tax breaks to individuals?'' It looks that way. We do 
not have to do much in the way of pumping hot air into that argument. 
It looks like that is what is going on.
  Republicans have to take that $300 billion tax cut and forget it. 
Democrats on the other hand, will have to say we will give on 
entitlements. We will tell the truth on entitlements. We will inform 
the American people.
  I believe Republicans as well will have to say, OK, maybe we scored 
some great political point in last year's election by alleging that 
when Democrats voted for the 1993 Deficit Reduction Act without a 
single Republican voting for it in the House or the Senate, we took a 
little political advantage by saying that every Social Security 
beneficiary had a tax increase.
  Do not tell me that Republicans were not saying that. I have heard 
it. I have seen it in advertisements. It worked. If I was a Republican 
and I had not voted for that, I would have done the same thing. It is 
an effective way to score political points.
  For gosh sakes, we cannot take that tax, I think, fairly applied at 
85 percent of income, reduce it to 50 percent, that takes money out of 
the Medicare part A fund.
 That makes the problem worse, not better. That is my two opening 
steps.

  I also think, by the way, that those of us who worked in the 
mainstream group last year, Republicans and Democrats, led by the 
distinguished Senator from Rhode Island--who worked so very hard to 
hold that mainstream group together--were pretty close to being on 
target when it came to health care. We did ask people to pay the full 
bill. We did ask people to share the cost of health care. We did not 
say there is a free lunch here.
  We had a reasonable plan, it seems to me, that was in the middle. 
Today, of course, health care reform is not very fashionable. But we 
had a bipartisan group of Republicans and Democrats who worked long and 
hard and got very close to a piece of legislation that I think, 
frankly, had we had a little more time, we might have been able to pass 
and we might not be in this fix we are in right now, trying to figure 
out what we are going to do about Medicare.
  If we treat Medicare only as a budget issue and not as a health care 
issue, we are going to find ourselves doing what none of us wants to 
do, in my judgment, and that is taking that couple out there who is 
working really hard, that American couple out there, where you have 
both the husband and wife--and we all know who we are talking about 
here--working for $5 and $6 and $7 an hour each and by the time they 
pay their payroll taxes and income taxes they have precious little 
money left; those individuals are, right now, if we treat Medicare only 
as a budget issue, going to find themselves paying a lot more money 
than they already are for health insurance. We are going to make their 
lives more miserable. Those Americans who say: I do not want to be on 
welfare; who say I do not want the Government of the United States of 
America to give me food stamps; I do not want to be on AFDC; I am 
willing to work at McDonald's; I am willing to work at Radio Shack; I 
am willing to work wherever I have to, but I am going to earn my own 
way-- those are the individuals in the United States of America today 
that are in the greatest amount of trouble, the ones who are not asking 
us for anything. Those individuals are going to suffer, in my judgment, 
if we treat Medicare only as a budget issue.
  So I say, here is one Democrat who is willing to work with 
Republicans. I have worked with the Senator from New Mexico on budget 
issues before and was pleased to be able to join with him on his U.S.A. 
Tax, an item that I believe in fact will generate more money for the 
U.S. Treasury by allowing people not to pay taxes on their savings and 
businesses expense off their investments that they made.
  We have to look not just at how much money we are generating, we have 
to look at ways to generate tax money that encourage economic growth, 
because in the end that is going to determine whether or not we are 
able to pay for anything, whether it is defense, or Medicare, or Social 
Security, or whatever it is.
  So I hope in the end of perhaps the next 3 weeks, after we have all 
had a little political fun here and scored our political points, that 
Democrats come and say: Here are our values. I am a Democrat and I 
believe the laws of the United States of America ought to say every 
single American has an opportunity to move up the economic ladder. I am 
willing to say you have to make an effort. There is no free lunch here. 
You have to work hard to do it.
  But I understand, if you are making $5, $6, $7 an hour, you have a 
tough time paying for health insurance; that retirement does not mean 
much for you; you are having a difficult time with child care because 
it is $500 or $600 a month for a couple of kids. I understand you are 
frustrated because you read in the newspaper and see there is an 80-
percent differential between what you can earn with a college degree 
and what you can earn with a high school degree, and yet you are not 
setting enough money aside for your kids. Then, when it comes time for 
you to get a college loan, you are told you are maybe making too much 
money; you are no longer eligible.
  So I am prepared to come and say: Here are my Democratic values. Here 
is what I believe in as a Democrat. I will bring those arguments to the 
table. But when it comes to deficit reduction, we are going to have to 
act like Americans. At some point, I am going to have to be willing to 
give. I am willing to give on entitlements. I am willing to go out on 
Medicare, Medicaid, Social Security, and say to the American people: 
Here is the truth.
  This is not the time, it seems to me, for us merely to hope we can 
score political points over the other party. This is the time for us to 
surprise the marketplace--and it would be a surprise if the Congress of 
the United States of America, in spite of the fact that we have a 
budget recommendation that calls for $200 billion deficits and no 
action on entitlements, can somehow manage to get together, Republicans 
and Democrats who care about deficit reduction, and surprise the 
marketplace and enact this year a 5- or 6- or 7-year deficit reduction 
plan that would get us to a balanced budget.
  I think the American people would not only be pleased--they may not 
like some of the cuts we put in place--but I think they would be 
pleased because the economy of the United States of America would grow, 
long-term interest rates would go down, the dollar would strengthen, 
and we would be creating more jobs again.
  I hope and pray in fact that this Congress does what the laws and the 
Constitution say we are supposed to do, and that is do the hard work of 
budgeting; make the hard choices that are required in budgeting. Then, 
once we have produced a budget resolution with both Republicans and 
Democrats on board, then it is time for us to challenge the executive 
branch, the President, to pony up and share some responsibility by 
going to the American people and saying he believes Congress has 
finally got it right.
  Mr. President, I yield the floor and I suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will please call the roll.
  [[Page S6168]] The bill clerk proceeded to call the roll.
  Mr. DOLE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  

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