[Congressional Record Volume 162, Number 91 (Thursday, June 9, 2016)]
[Senate]
[Pages S3668-S3677]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2017
The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of S. 2943, which the clerk will report.
The legislative clerk read as follows:
A bill (S. 2943) to authorize appropriations for fiscal
year 2017 for military activities of the Department of
Defense, for military construction, and for defense
activities of the Department of Energy, to prescribe military
personnel strengths for such fiscal year, and for other
purposes.
Pending:
McCain amendment No. 4229, to address unfunded priorities
of the Armed Forces.
Reed/Mikulski amendment No. 4549 (to amendment No. 4229),
to authorize parity for defense and nondefense spending
pursuant to the Bipartisan Budget Act of 2015.
Mr. REID. Mr. President, is the time automatically divided?
The PRESIDING OFFICER. It is not.
Mr. REID. I suggest the absence of a quorum and ask that the time be
divided equally between the majority and minority.
The PRESIDING OFFICER. The time is not generally divided.
Mr. REID. Oh, it is not divided.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BLUNT. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Rounds). Without objection, it is so
ordered.
72nd Anniversary of D-day
Mr. BLUNT. Mr. President, this week, as we are debating the National
Defense Authorization Act, we also celebrate the 72nd anniversary of D-
day. On June 6, 1944, more than 160,000 allied troops, including 70,000
brave Americans, did something that no one had ever tried before--a
cross-channel landing the size and scope of which had never been
envisioned as a reality by warriors. These brave soldiers stormed the
beaches of Normandy.
I had an opportunity a few years ago to visit the Normandy American
Cemetery and Memorial. I walked through the cemetery with a Belgian
guide who had a great appreciation for everything our American soldiers
had done to try to bring freedom to Europe again. By the way, later
that summer he visited the National World War I Memorial in Kansas
City, MO. We talked about the cemetery. One of my sons and one of my
grandsons were with us, and they had a chance to identify two brothers
buried side by side and a father and son who were buried side by side.
These Missourians had given their life on D-day.
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Our guide sat us down on this low wall with the English Channel
behind us where the Atlantic Ocean flows in and out and with the 8,000
or so graves in front of us. He then opened up his computer, and there
was a picture of General Eisenhower and Walter Cronkite sitting in
exactly the same place 20 years after the D-day landing, June 6, 1964.
Former President Eisenhower said something like this: You know, Walter,
my son graduated from West Point on D-day, and many times over the last
20 years, I thought about the family that he and his wife have had a
chance to raise and the experiences they shared, and I thought about
these young men who didn't have those 20 years because of what they
were asked to do.
To hear those words spoken by the person who was ultimately the one
who asked these brave soldiers to do what they did showed the
responsibility he felt 20 years later for the many lives that were lost
and those bodies that were brought back to the United States. That
Normandy cemetery doesn't even begin to reflect the lives that were
lost. It really made me think when he said: Many times over the last 20
years, I thought about these young men and the lives they didn't get to
have because of what they were asked to do.
We have debated this bill for over 50 years now, and we have passed
this bill every single year. Every time we debate this bill, we should
think of what those who defend us are asked to do. We should think
about men and women who are carrying on the legacy of that generation
of D-day and World War II and Vietnam and Korea and wars before that
and after and the obligation we have to be sure that they have every
possible advantage in any fight. Frankly, we never want to see
Americans in a fair fight; we want it to be an unfair fight. We want
those who defend us to have the best weapons, best training, best
support, and the best of everything so they have every possible
advantage when they do what they are asked to do.
This bill came out of committee with three ``no'' votes. It has
strong bipartisan support. It is time to get this work done just as the
Senate has done for 54 straight years. This will be the 55th year.
I am particularly glad that this bill takes new steps toward
recognizing the sacrifice we ask military families to make. GEN Ray
Odierno, the immediate last Chief of Staff of the Army, said that the
strength of a country is its military and the strength of the military
is its families.
This legislation includes language that Senator Gillibrand and I
introduced last fall which, for the first time ever, would give
families more flexibility if there is a job or educational opportunity
for a spouse. Many times, military families are asked to move a little
quicker or stay a little longer. If our language is in the final bill
and the President signs it, for the first time ever it will allow
families--without being questioned in any detail beyond whether they
meet the conditions of the Military Families Stability Act--to go ahead
and move so the kids can start school on time, or whatever the case may
be, and the servicemember would stay or a family could stay a little
longer so that their spouse can complete any career obligations they
may have so they can continue to do what they do. Too many of our
military spouses are unemployed and don't want to be or underemployed
and don't want to be because their careers are constantly impacted, and
the cost of maintaining two residences that those families now have to
bear really makes no sense at all. This bill allows us to move forward
on that issue.
The men and women of the Armed Forces, as well as the civilians and
contractors who support them, work every day to meet the challenge.
They have faced more than 15 years of active military engagements and
have made all kinds of sacrifices so we can continue to have the
freedoms that we have.
The bill before us also enhances the capability of the military and
security forces of allied and friendly nations to defeat ISIL, Al
Qaeda, and other violent extremist organizations so they are no longer
a threat to us. This bill ensures that our men and women in uniform
have the advanced equipment they need to succeed in any future combats.
The bill reduces strategic risk to the Nation and our military
servicemembers by prioritizing the restoration of the military's
readiness so they are able to conduct the full range of all of its
activities. We need training dollars, training time, and airplanes that
are younger than the pilots who fly them, and this legislation
continues to move forward in that area.
It also continues with comprehensive reform for the Defense
Acquisition System that is designed to drive more innovation and ensure
more accountability to not take more time than it needs to take, but to
be sure that everything is being done with the interest of the
taxpayers and the security of the country in mind.
Finally, this bill puts the Senate on record again against the
President's plan to remove terrorist detainees held at Guantanamo Bay.
We apparently need to continue to do this over and over again because
somebody is just not getting it.
There was a front page article, I believe in the Washington Post this
morning, about the absolute certainty that people who are freed from
Guantanamo Bay over and over again reenter the fight and kill Americans
and our allies. The people who are there now need to be kept there. The
Obama administration itself admitted earlier this year that Americans
have been killed by terrorists from Guantanamo. By the way, that
admission came just days before another dozen inmates were transferred
out of Guantanamo.
According to the Director of National Intelligence, nearly one-third
of terrorists who have been released from Guantanamo are either
confirmed or suspected to be rejoining the fight, and those were
supposedly the detainees who could be released. They were supposedly
the least dangerous of the detainees. The people who are there now are
clearly understood to be the most dangerous, the most likely to be back
in the fight, and the most likely to inspire others to be in the fight.
The number of detainees released under the Obama administration who
were suspected of engaging in terrorism has doubled since July of 2015
according to the Director of National Intelligence. The President of
the United States supports and appoints the Director of National
Intelligence. This is not some outside person suggesting things that
the Obama administration wouldn't want to hear. This is their Director
of National Intelligence and ours. What we need is a President who has
a real plan to defeat terrorism, and while this bill can't ensure that,
this bill does provide the tools to defeat current terrorists in the
Middle East and continue to secure our liberty.
The No. 1 job of the Federal Government is to defend the country. The
No. 1 job of those of us in the Congress is to be sure that those who
defend the country have what they need to defend the country and to
ensure that those who have served have every commitment that has been
made to them fulfilled, and then some.
It is time to pass this bill for the 55th straight year. We need to
do what we should do for those who serve and protect us.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. McCAIN. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Arizona.
Mr. McCAIN. Mr. President, I ask unanimous consent to be permitted to
engage in a colloquy with the Senator from South Carolina.
The PRESIDING OFFICER. Without objection, it is so ordered.
Amendment No. 4229
Mr. McCAIN. Mr. President, we will have a vote around 11:30 a.m. on
my amendment that would increase funding under OCO to address the
consequences of an $18 billion shortfall from last year. All the
reports we hear from the military are that sequestration is killing
them. The mismatch of what we are now seeing in the world as compared
with a continued $150 billion less than fiscal year 2011 is putting the
lives of the men and women who are serving this Nation in danger.
I am told there will be a lot of people who will vote against this
increase to
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bring it up just to last year's number--an increase of $18 billion. I
say to my colleagues: If you vote no on this amendment, the
consequences will be on your conscience. If you ask any leader in
uniform today, they will tell you that the lives of the men and women
who are serving this Nation in uniform are at risk. I think we have a
greater obligation, and that is the men and women who are serving in
the military.
The Chief of Staff of the United States Army said: We are putting the
lives of the men and women serving in uniform at greater risk. That
didn't come from John McCain or Lindsey Graham. Talk to any military
leader in uniform, and they will tell you that sequestration is killing
them. Planes can't fly; parts of the military can't train and equip.
Only two of our brigade combat teams are fully ready to fight. Look at
the world in 2011 when we started this idiotic sequestration and look
at the world today.
My colleague serves on the Armed Services Committee and spent about
33 years as a member of the United States military and has been a
regular visitor to Kabul and Baghdad. I think he understands that what
we are doing with sequestration and voting against this amendment, in
my view, is putting the lives of the men and women who are serving in
danger. Have no doubt about it. There will be further attacks in
Europe, and there will be further attacks in the United States of
America. We won't be ready, and the responsibility for it will be on
those who vote no on this amendment.
I recognize my colleague.
Mr. GRAHAM. I thank the Senator.
Here is the issue: To those who are a slave to these sequestration
caps, to those who believe sequestration and this budget practice we
are involved with is going to save the country, boy, I couldn't
disagree with you more. We haven't moved the debt needle at all.
Discretionary spending is not the reason we are in debt. We are
spending at a 2008 level. So these blind, across-the-board cuts limited
to discretionary spending and a lot of programs that are not even
subject to sequestration are not moving the debt needle; they are
destroying the ability to defend this country.
The theory we are advocating here today is that there is an emergency
in the U.S. military that needs to be addressed and we should be able
to add money to the U.S. military, the Department of Defense, based on
an emergency that is real and not be limited by caps that are insane.
Here is the issue: Is there an emergency in terms of readiness? Is
there an emergency in terms of operations and maintenance? Are we
putting the ability to modernize our force at risk in an emergency
situation because we don't have enough money to fight the wars we are
in and modernize the force for the wars to come?
If you don't believe us, here is what the Commandant of the Marine
Corps said about the current state of readiness: ``Our aviation units
are currently unable to meet our training and mission requirements,
primarily due to Ready Basic Aircraft shortfalls.''
I can tell you that in the Marine Corps today, 70 percent of the F-
18s have a problem meeting combat status. I can tell you today that the
Army is stretched unlike any time I have ever seen. I can tell you
today that the Navy is robbing Peter to pay Paul to keep the ships on
the ocean, and with the numbers we have in terms of defense spending,
they are having to forgo modernization to deal with readiness, to deal
with the ability to fight the war. I can tell you that the Commandant
of the Marine Corps is going to take six B-22s out of Spain that are
used to rescue consulates and embassies that come under attack in
Africa because we need those planes to train pilots, and if we don't
bring back those planes, we are not going to have an airworthy B-22
force at a time when we need it.
We are creating a hole and a vacuum in our ability to protect our
diplomats and U.S. citizens.
Mr. McCAIN. May I ask my colleague whether he is aware that, at a
hearing, General Milley, the Chief of Staff of the U.S. Army, testified
that the Army risked not having ready forces available to provide
flexible options to our national leadership and, most importantly,
risked incurring significantly increased U.S. casualties.
I say to my colleagues who are going to vote against this, you are
taking on a heavy burden of responsibility of incurring significantly
increased U.S. casualties in case of an emergency. The military is not
ready. We are at $100 billion less than we were in 2011 when
sequestration began, and the world has changed dramatically.
I can't tell you my disappointment to hear that the chairman of the
Appropriations Committee--I don't know if my colleague knows this--said
he is going to vote against it, using some rationale that they are
increasing it by some $7 billion. That is insane. That is not only
insane, it is irresponsible, and most importantly, it is out of touch.
I say to my colleague and the chairman of the subcommittee, you are out
of touch with what is going on in the world and in the U.S. military.
You better get in touch.
Mr. GRAHAM. I will add that anybody who doesn't believe there is an
emergency in the U.S. military is not listening to the U.S. military
and has not been following the consequences of what we have done over
the last 5 or 6 years in terms of cuts to the military.
Over the last 7 or 8 years, we cut $1 trillion out of the U.S.
military. We are on track now to have the smallest Army since 1940, the
smallest Navy since 1915, and the smallest Air Force in modern times.
We are on track to spend half of what we normally spend in time of war.
Normally we spend about 4.5 percent of GDP to defend this Nation; we
are on track by 2021 to spend 2.3 percent of GDP.
I want to say this: In my view, this is an emergency. I want you to
go back home and explain to those who are busting their ass to fight
this war, who can't fly equipment because it is too dangerous, who are
having to cannibalize planes to keep some planes in the air, who are
stretched so thin that it is creating high risk.
Here is what the Chief of Staff of the Army said: ``I characterize us
at this current state at high military risk.'' This is the Chief of
Staff of the Army telling all of us that the Army is in a high state of
risk because of budget cuts.
This $18 billion will restore money that has been taken out. That
will have a beneficial effect now and is absolutely essential. It will
give us 15,000 more people in the Army. And if you are in the Army, you
would like to have some more colleagues because you have been going
back and forth, back and forth. So we need more people in the Army, not
less.
We need 3,000 more marines. If anybody has borne the burden of this
war, it is the U.S. Marine Corps. Here is what I say: Let's hire more
marines.
Let's start listening to what is going on in the military.
The whole theory of this amendment is that we have let this
deteriorate to the point that we have an emergency situation where we
are putting our men and women's lives at risk because they don't have
the equipment they need and the training opportunities they deserve to
fight the war that we can't afford to lose, and you are going to vote
no because you are worried about budget caps.
Oh, we love the military. Everybody loves the military. Well, your
love doesn't help them. Your love doesn't buy a damn thing. If you love
these men and women, you will adequately fund their needs. If you care
about them and their families, you will adjust the budget so they can
fight a war on our behalf.
We are up here arguing about everything. The state of politics in
America makes me sick. This looks like one thing we can agree on--
Libertarians, vegetarians, Republicans, and Democrats--that those who
are fighting this war deserve better than we are giving them.
So I want to tell you, when you come and vote against this amendment
because you are worried about the budget caps, well, the Budget
Committee is not going to fight this war.
To my friends at Heritage Action, I agree with you a lot. You are
saying this is a bad vote. Nobody at Heritage Action is going to go
over to Afghanistan, Iraq, Syria, or Libya to protect this country.
You talk about a head-in-the-sand Congress. You talk about people who
are not listening, who are so worried about special interest groups and
concepts that have absolutely no basis in reality.
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If you fully implement sequestration, all you will do is gut the
military and some nondefense programs that really matter to us. You
won't change the debt at all. So don't go around telling people you are
getting us to a balanced budget. You are not. The money is in
entitlements, and we are not doing a damn thing about it.
Ryan-Murray added some money, and I want to thank him, but it wasn't
enough. I want to thank the appropriators for adding $7 billion, but it
is not nearly enough. The $18 billion that is in this amendment goes to
buy airplanes--14 F-18s, 5 F-35s, 2 F-35Bs. There is $200 million to
help the Israelis with their missile defense program.
What this buys is more people, more equipment, more training
opportunities at a time when we need all of the above. It breaks the
cap because we are in an emergency situation. These caps are straining
our ability to defend this Nation. I hate what we have done to the
military. This is a small step forward. This is not nearly what we
need, but this $18 billion will provide some needed relief to the
people who have been fighting this war for 15 years.
I hope and pray that you will start listening to those we put in
charge of our military and respond to their needs, and this is a small
step in the right direction.
If we say no to this amendment, God help us all. And you own it. You
own the state of high risk. If you vote no, then as far as I am
concerned, you better never say ``I love the military'' anymore because
if you really loved them, you would do something about it.
Mr. McCAIN. I also point out to my colleague that, as a sign of
priorities around this place, yesterday we had a vote on medical
research--nearly $1 billion that had nothing to do with the military
but was a place where the Willy Sutton syndrome took place, and it was
a 5-percent increase. The appropriators could increase by 5 percent
medical research which has nothing to do with the military, but they
won't add money that the military could use to defend this Nation.
There is no greater example of the priorities around this place.
I see my colleagues are waiting. I just want to point out what voting
no means.
Voting no would be a vote in favor of another year where the pay for
our troops doesn't keep pace with inflation or private sector
advocates. For the fourth year in a row, the military will receive less
of a pay raise than the rate of inflation. If you vote no, that is what
you are doing.
If you vote no, it would be a vote in favor of cutting more soldiers
and more U.S. marines at a time when the operational requirements for
our Nation's land forces for the Middle East, Africa, Europe, and Asia
are growing. Every time you turn around, you will see that there are
more troops deployed in more places, whether it be Iraq, Syria, Libya,
the European Reassurance Initiative. Every time you turn around, there
is more deployment--more deployments in the Far East and the Asian-
Pacific regions. Every time you turn around, there are more obligations
that we ask of the military, albeit incrementally. Yet we are going to
cut the funding while we increase the commitments we have. So you would
be voting in favor of cutting more soldiers and marines at a time when
the operational requirements of our Nation's land forces are growing.
Voting no would be a vote in favor of continuing to shrink the number
of aircraft that are available to the Air Force, Navy, and Marine Corps
at a time when they are already too small to perform their current
missions and are being forced to cannibalize.
We have people who are having to go to the boneyard in Tucson, AZ,
and take parts from planes that haven't been operational for years.
That is how bad the system has become thanks to sequestration. Our
maintainers--these incredible enlisted people--are working 16 to 18
hours a day trying to keep these planes in the air.
When an Air Force squadron came back, of their 20 airplanes, 6 were
flyable.
There was a piece on FOX News the other day about how, down in
Beaufort, SC, the F-18 squadron--they are having to have a plane in the
hangar that they can take parts from so that they can keep other planes
flying. They are exhausted. They are exhausted, these young marines.
And by the way, don't think they are going to stay in when they are
subjected to this kind of work environment.
Voting no would be a vote in favor of shrinking the number of
aircraft. They are too small, and their current missions are being
forced to cannibalize their own fleets.
Voting no would be a vote in favor of letting arbitrary budget caps
set the timeline for our mission in Afghanistan instead of giving our
troops and our Afghan partners a fighting chance at victory.
Voting no is a vote in favor of continuing to ask our men and women
in uniform to perform more and more tasks with inadequate readiness,
inadequate equipment, inadequate numbers of people, and unacceptable
levels of risk in the missions themselves. It is unfair to them. It is
wrong. It is wrong.
For the sake of the men and women in the military who put their lives
on the line as we seek to defend this Nation, I hope my colleagues on
both sides of the aisle will make the right choice. For 5 years we have
let politics, not strategy, determine what resources we give our
military servicemembers. Our military commanders have warned us that we
risk sending young Americans into a conflict for which they are not
prepared.
I know that the vast majority of my colleagues on both sides of the
aisle recognize the mistakes of the past 5 years in creating this
danger. This is a reality. This is the reality our soldiers, sailors,
airmen, and marines are facing. So I say it doesn't have to be this
way. It doesn't have to be this way. And if you vote no, as my
colleague from South Carolina said, don't say you are in favor of the
military. Don't be that hypocritical. Just say that you are continuing
to put the lives of these men and women who are serving in the
military, in the words of the Chief of Staff of the U.S. Army, ``in
greater danger.'' That is your responsibility. But just don't say--
don't go home and say how much you appreciate the men and women in the
military, because when you vote no, you are depriving them of the
ability to defend this Nation and themselves.
I yield the floor.
Mr. DURBIN. Mr. President, I rise in opposition to the amendment
proposed by the senior Senator from Arizona. What it comes down to is
that Republicans and Democrats have fundamentally different approaches
to providing for our troops, our national security agencies, and our
government.
Democrats are committed providing the funds necessary to protect our
Nation, grow our economy, invest in research, and shelter the most
vulnerable. Republicans have a different approach. They accept massive
cuts to almost every agency and only provide defense funding through an
accounting trick which the Defense Department's own leadership has
rejected as inadequate.
This is a debate about how best to protect our national security. And
my Republican colleagues are on the wrong side of it.
Senate Democrats are committed to defeating ISIS on the ground in
Iraq and Syria, dismantling its terror network, and protecting our
homeland. The only way we can do that is by supporting budget relief
for all of our national security agencies, including Homeland Security,
the FBI, and many others. Republicans haven't been willing to do that
so we must figure out how to allocate funding with the existing budget
agreement.
The amendment offered by the chairman of the Armed Services Committee
is a return to gridlock. Last year's attempt to provide only the
Defense Department with additional OCO funds resulted in a stalemate
and a 3-month long continuing resolution. Do we have to repeat this
failed strategy again?
The answer is no. The chairman of the Appropriations Committee and I
took a different approach in drafting the Defense appropriations bill:
no poison pill riders, stick to the budget deal, eliminate wasteful
spending proposals, and reinvest in our priorities.
If you compare the results in the Defense appropriations bill to the
amendment proposed by the chairman of the Armed Services Committee,
here is what you will find: His proposal violates last year's budget
deal with $18
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billion more in spending. Our bipartisan Defense appropriations bill
invests $15 billion in important programs while adhering to the deal.
The pending amendment relies on an OCO gimmick to authorize increases
for Israeli missile defense programs. However, every cent requested by
the Israeli Government, all $600.9 million, is funded in the Defense
appropriations bill without using OCO funds.
This amendment authorizes OCO funding for a littoral combat ship and
a DDG-51 destroyer. This would be the first time that OCO funds would
be used to buy ships for the Navy.
The appropriations bill goes even further in supporting shipbuilding
by providing $1 billion for a new icebreaker to support our Arctic
strategy, an item not included in the pending amendment.
The amendment also adds various aircraft--more F-18s, F-35s, C-130s,
helicopters, and so on--that are also funded in the Defense
appropriations bill without running up the Nation's OCO charge card.
The bottom line is that, in the Defense appropriations bill, we were
able to fund most of the items in Senator McCain's OCO gimmick
amendment, but we were able to it within the budget caps. It wasn't
easy, but we made it work.
I would prefer that we find a way to increase both defense and
nondefense funding so we can invest more in all of the agencies that
work together to keep America safe.
The Reed amendment does exactly that. It amends last year's budget
deal to include $18 billion more for defense and $18 billion more for
important nondefense programs.
The Reed amendment includes $2 billion more to address cyber security
vulnerabilities to stop the type of attacks that resulted in the theft
of millions of personnel records from the Office of Personnel
Management. It includes $1.4 billion for more law enforcement efforts,
including more security screeners at airports, more FBI agents and
police officers on the street, and more grants to State and local first
responders.
The Reed amendment addresses public health emergencies, including
$1.9 billion for the response to Zika. It also provides $1.9 billion to
fix our broken water infrastructure, which would help ensure we don't
face another lead contaminated water crisis like what happened Flint,
MI.
Finally, the Reed amendment includes $3.2 billion in funding to
address infrastructure problems at VA hospitals, fix our roads and
bridges, and invest in our rail and transit systems.
Last year, Congress voted to provide fair and balanced relief to our
Defense and our nondefense agencies. The Reed amendment is consistent
with that agreement, and it deserves our support.
In conclusion, we should be supporting all of our national security
agencies as they work to protect this Nation, including cyber security,
homeland security, and local law enforcement, the FBI, and TSA.
We also should support critical issues like the opioid epidemic,
water infrastructure, the Zika outbreak, and research across the
Federal Government among other items.
I urge my colleagues to support Ranking Member Reed's amendment.
The PRESIDING OFFICER. The Senator from North Dakota.
Unanimous Consent Request--Presidential Nomination
Ms. HEITKAMP. Mr. President, I ask unanimous consent that the Senate
proceed to executive session and the Banking Committee be discharged
from consideration of PN1053, the nomination of Mark McWatters for the
Board of Directors at the Export-Import Bank; that the Senate proceed
to its consideration and vote without intervening action or debate;
that if confirmed, the motion to reconsider be considered made and laid
upon the table with no intervening action or debate; that no further
motions be in order to the nomination; that any statements related to
the nomination be printed in the Record; that the President be
immediately notified of the Senate's action, and the Senate then resume
legislative session.
The PRESIDING OFFICER. Is there objection?
Mr. SHELBY. Mr. President, I object.
The PRESIDING OFFICER. Objection is heard.
Ms. HEITKAMP. Mr. President, we would like to engage in a discussion
of what this means to American workers, to American exports, and to
American manufacturing. I think we have worked very, very hard over the
last several months to try and move this nomination forward. We fought
this fight. Many appearing with me today fought this fight, whether it
was on TPA or whether it was just simply trying to get reauthorization
of the Ex-Im Bank advanced and furthered.
We won this fight. Today we are losing the fight again by this
restriction, by this inability to move this nomination forward. So we
want to talk about this today. I am going to yield to several of my
colleagues here for their short comments. We will start with Senator
Schumer who has a commitment with the Judiciary Committee.
Mr. SCHUMER. Mr. President, I want to thank my dear friend, the
Senator from North Dakota, for her leadership on this issue, as well as
our two great Senators from the State of Washington, Maria Cantwell and
Patty Murray.
I support my colleague from North Dakota and echo her comments. We
should have a full complement of Board members at the Ex-Im Bank and,
at the very least, they must have enough to reach a quorum and continue
to conduct its business. I also want to thank my three colleagues who
are here for their tireless efforts to get the Ex-Im Bank reauthorized
last year. The legislation to reauthorize was carried by the Senator
from North Dakota, as well as Senators Cantwell and Murray, after
Republican obstruction caused it to lapse for the first time in its 80-
year history.
What a shame it was that it lapsed. The Ex-Im Bank is one of the key
tools in our toolbox for supporting and growing manufacturing jobs
across the country. We talk about increasing good-paying manufacturing
jobs. Both sides of the aisle do that regularly. Then, when it comes to
supporting the Ex-Im Bank, they obstruct one of the best tools we have.
They vote no. Now they have found a clever way to stop it from working,
because it won't have a quorum.
The Ex-Im Bank provides necessary financing for domestic
manufacturers to compete with foreign companies that are heavily
subsidized or are owned entirely by their government and simply to have
access to their own domestic import bank. To purposefully prevent the
Ex-Im Bank from being able to properly function is like having America
unilaterally disarm in the global competition for exports and good-
paying manufacturing jobs here at home.
But there are a small band of folks--ideologues--so ideologically
opposed to the Bank that they will do anything to see that it can come
to a screeching halt. They will use every trick in the book to do it.
That is what they are doing now. Opponents of the Bank are hamstringing
the agency by denying it the staff it needs to operate.
We are losing $50 million a day in exports. Some of these come from
my home State of New York. We have not only GE, which makes turbines, a
large percentage of which are exported. They are losing business to
Siemens and other foreign companies.
We have lost some little companies that depend even more on the Ex-Im
Bank because it gives them the ability to find markets overseas. So I
don't want to hear my colleagues on the other side of the aisle talk
about how they care about jobs, how they care about building America
and building our exports, as long as they continue to play this trick
and hamstring the Ex-Im Bank from functioning. Mr. President, as I
said, I rise today to support my friend and colleague the Senator from
North Dakota and echo her comments: We should have a full complement of
Board members at the Ex-Im Bank, and at the very least they must have
enough to reach a quorum and continue to conduct its business.
I also want to thank her for her tireless efforts to get the Export-
Import Bank reauthorized last year. The legislation to reauthorize the
bank was carried by the Senator from North Dakota and several other
colleagues of ours, like Senators Cantwell and Murray, after Republican
obstruction caused it to lapse for the first time in its 80-year
history.
And it was a shame that it ever lapsed.
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The Ex-Im Bank is one of the key tools in our toolbox for supporting
and growing manufacturing jobs across the country. It provides the
financing necessary for domestic manufacturers to compete with foreign
companies that are heavily subsidized or owned entirely by their
governments or simply have access to their own domestic Ex-Im Bank.
To purposefully prevent the Ex-Im Bank from being able to properly
function is like having America unilaterally disarm in the global
competition for exports.
But there is a small band of folks who are so ideologically opposed
to the bank that they will do anything they can to see it come to a
screeching halt. And they will use every trick in the book to do it.
That is what we are seeing now.
Opponents of the bank are hamstringing the agency by denying it the
staff they need to operate.
Right now, the Export-Import Bank is unable to approve any of the
financing deals over $10 million because the Bank only currently has
two members serving on its five-member board.
This is a problem because the Board needs at least a quorum of three
to approve financing for large deals.
But the Banking Committee has so far refused to even consider a third
nomination to the Board of the Export-Import Bank and has given no
indication that it even plans to hold a hearing on the nomination any
time soon.
It can't be because the chairman opposes the nominee's politics or
views--the nominee is a Republican, irony of ironies. The President has
put forward Mark McWatters, a former staffer for Republican Hensarling,
the Republican Chairman of House Financial Services.
The delay on the nomination has nothing to do with the nominee or his
qualifications and everything to do with keeping the Ex-Im Bank from
doing its job.
The delay, as Senator Heitkamp pointed out, has real consequences:
30 major projects in the pipeline valued at more than $10B are now
mired in uncertainty.
The Peterson Institute estimated that each day the confirmation is
delayed, the US is losing $50 million in exports.
This impacts major companies in my home State of New York like GE,
which makes turbines near Schenectady and employs over 7,000 folks in
the Albany area alone.
GE not only employs thousands of people in my state, it supports an
entire supply chain in the capital region. So when a contract or sale
abroad is not approved or bids are not even sought because of the
uncertainty surrounding the Ex-Im Bank, there is a real cost to the
economy.
I understand there are those on the other side of the aisle,
including the distinguished chairman of the Banking Committee, who
oppose the very existence of the Export-Import Bank.
But the fact of the matter is the Bank exists. The full Senate voted
to reauthorize it. And it is our jobs as legislators to ensure that
government agencies have the staff they need to do the job we ask them
to do.
The PRESIDING OFFICER. The Senator from Washington.
Mrs. MURRAY. Mr. President, I am here today to support the strong
statement from the Senator from North Dakota and the strong support for
a fully functioning Export-Import Bank because it creates American jobs
and helps our businesses, large and small, and, in fact, reduces our
national debt. But right now, political posturing has handicapped the
Ex-Im Bank, one of our countries most reliable tools to increase
America's economic competitiveness in our global economy.
In my home State of Washington, there are nearly 100 businesses, the
majority of them small or medium-sized, that used the Bank's services
last year to help sell their products overseas. We are talking about
everything from apples to airplane parts, beer, wine, software, medical
training supplies, and beyond.
The reality is that people in other countries want American-made
products. That is a great thing because these businesses support tens
of thousands of jobs in our country and keep our economy moving.
The Export-Import Bank is the right kind of investment because it
expands the access of American businesses to emerging foreign markets
that create jobs right here at home.
Do you know what it costs taxpayers? Not a single penny. In fact, the
Ex-Im Bank reduces our national debt.
So here is the bottom line. The Bank creates jobs. It strengthens our
businesses. It helps our economy grow from the middle out, not just the
top down.
So it is time for my colleagues to put ideology aside, to allow this
proven program to operate at its full capacity, and to allow a vote
that we were denied today to get the Ex-Im Board operating again
because it is critical that the Bank continue to receive the strong
bipartisan support we have seen in the past as we work to build on its
success.
I yield the floor.
The PRESIDING OFFICER. The Senator from Washington.
Ms. CANTWELL. Mr. President, I join my colleagues this morning on the
Senate floor in an effort to wake up the Senate to the fact that,
without action by this body and specifically the Senate Banking
Committee, Members are literally supporting shipping jobs overseas. I
believe in a manufacturing economy. I believe in a manufacturing
economy because so many people in the State of Washington work in
manufacturing and because aerospace is an industry in which the United
States is still a world leader.
Yet, by not filling the board of the Export-Import Bank we are
putting the Bank out of business when we should be making sure that it
can issue credit for manufactured U.S. products to be sold in overseas
markets.
Why is manufacturing so important? Manufacturing is important because
it pays a decent wage. It allows American workers to go from working
class to middle class. It helps secure jobs in our economy that are
stable for families who are sending their kids to school, and because
it helps people move up to a better quality of life.
I am competitive in general. I don't want to lose a manufacturing
base. But I also don't want to lose a middle class. What has happened
is that the conservative views of the Heritage Foundation have thwarted
the Export-Import Bank, and U.S. manufacturers have decided to put
their manufacturing overseas. Think about it. How long is a company or
a business going to put up with the fact that they don't have an export
credit agency here in the United States?
Now, can a big manufacturer get its own credit? Sure it can. Sure, it
can go and get credit. But can you ask it to sell in a global market? I
will give you an example of a manufacturer in our State, SCAFCO, which
sells manufactured grain silos to many countries in South America, in
Africa, in Asia, and all across the world. Do you think they are going
to finance every single deal they do? No, because they have to put
money into their manufacturing facilities so they can stay competitive,
and so they can have the best silos being produced.
So if they limited their business to only deals they could finance,
they would have very limited business. Think about it. Whom do we make
that requirement of? It is the customer who is buying the exported
product who needs the business to get credit. It is the customer who is
out there that wants to purchase what are great U.S. products who is
having trouble. Think about it. You could be a small African nation
trying to change your economy toward agriculture or you could be a
small Asian country that is trying to upgrade the quality of life.
It could be, just as Prime Minister Modi said yesterday, that they
want to diversify their energy portfolio. Well, guess what? We are
holding that up and not allowing all of those countries to buy U.S.
energy products simply because we refuse to have a working board at the
export credit agency. How ludicrous is that? It is so ludicrous,
because what happens if a U.S. manufacturer--an aerospace manufacturer
like Boeing for example--wants consumers to buy GE engines and make
sure that a South American company purchases U.S. manufactured Boeing
and GE engines?
Well, they can go and purchase Rolls-Royce engines instead, and the
European credit agency can fund the deal. Now, what has happened? GE
has lost out on deals. Do you think all of those U.S. manufacturers are
going to stay in the United States if there is no way to have credit
financing? No--they are
[[Page S3674]]
going to go where credit financing exists. So, by not moving forward on
a fully functioning export credit agency in the United States, all you
are doing is helping to ship jobs overseas. It has to stop.
We make great products in the United States. We are competitive. Our
workforce is skilled. I will be the first to say that we need a more
skilled workforce. I am all for providing our workforce with education
and skills and every resource our country has because innovation is our
competitive advantage.
But if we make great products and then we hamstring the financing of
those great products--developing countries don't have the same banking
and financial tools and edge that we have in the United States--you are
basically saying: We are not going to sell our products.
I am a big proponent of winning in the international marketplace. I
am a big proponent of saying that the middle class is growing around
the globe, and one of the United States' biggest economic opportunities
is to sell products to that middle class outside of the United States.
That rising middle class means they can purchase more U.S. products.
Well, they can't if we don't have a credit agency that finances
exports. So why are we down here this morning as it relates to the
Defense bill that is now being discussed?
Well, we are here because there are more than $10 billion of deals
and transactions that are in the Export-Import Bank pipeline.
Yesterday, Prime Minister Modi was here. The Indian Government has
announced that Westinghouse would finalize contracts with the Nuclear
Power Corporation of India to build six nuclear reactors by 2030. Well,
those deals won't get done if you don't have an export credit agency to
finance those deals.
The United States Senate is currently considering the National
Defense Authorization Act. Last month, the Aerospace Industries
Association and the National Defense Industrial Association wrote
letters to Senate leadership urging them to make sure that we had a
functioning bank. They pointed out that without a quorum, multimillion-
dollar exports of aircraft, satellite, and other things won't get done.
So we just had this little argument on the Senate floor about how we
are going to pay for things in the Defense bill and whether we are
going to have balance with our other domestic spending. By not
supporting and moving forward on the export credit agency, you are also
making defense in the United States more expensive. You are making our
security more expensive because you are not allowing that same
technology--that we have decided meets our export controls, but we are
willing because these are partners of ours--to sell that defense. You
are making that difficult.
Mr. President, I ask unanimous consent to have printed in the Record
this letter from the Aerospace Industries Association and the National
Defense Industrial Association, basically saying you are making it more
expensive for us to do business as a country in defense because you
also will not allow the export of this product.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Aerospace Industries Association, National Defense
Industrial Association,
May 17, 2016.
Hon. Mitch McConnell,
Senate Majority Leader, U.S. Senate, Washington, DC.
Hon. Harry Reid,
Senate Minority Leader, U.S. Senate, Washington, DC.
Dear Senate Majority Leader McConnell, and Senate Minority
Leader Reid: On behalf of the American aerospace and defense
industry and our dedicated workforce, we are writing to urge
Senate hearings and confirmation on the nomination of J. Mark
McWatters to the Board of Directors for the U.S. Export-
Import (Ex-Im) Bank. If his nomination is successfully
approved, a fully functioning bank will play an important
role in leveling the playing field for U.S. exports, creating
new opportunities for U.S. companies, and strengthening our
strategic alliances throughout the world.
Last year, we were heartened to see a bipartisan, bicameral
supermajority vote overwhelmingly in favor of long-term
reauthorization of the Ex-Im Bank. However, the Bank remains
effectively inoperable for large-scale export activities.
While the Bank is accepting new applications, the Bank's
Board of Directors must have a quorum to act on transactions
valued at $10 million or more. In the absence of a quorum,
potential multi-million dollar export sales of aircraft and
satellites are at risk, hurting not only major manufacturers,
but the small and medium-sized companies that support them.
The global market is fiercely competitive. U.S.
manufacturers need fair trade policy measures to level the
playing field. Other countries are aggressively utilizing
their Export Credit Agencies (ECAs) as a tool to advance
their national trade interests, and availability of financing
(instead of the quality of products) is a key discriminator
if we do not have our own ECA. Our competitors also enjoy a
greater range of support from their ECAs, including--but not
limited to--a broader scope of programs.
Without the Bank supporting some of these investment-heavy
exports, U.S. industrial production will decline, reducing
revenue, innovation, and high-skilled, high-wage jobs
throughout the aerospace and defense supply chain. The fact
that this will lead to higher unit costs for the military
systems our armed forces buy seems to be dismissed or
ignored. Also, we are only now recovering lost capacity and
market share in the commercial satellite market caused by
over-restrictive export controls, which had a similar
detrimental impact on our national security space industrial
base.
In addition to supporting U.S. export sales, the Bank is an
important foreign policy tool for the U.S. government as it
bolsters American presence and influence abroad. By
developing closer economic ties to other countries, we
enhance not only our economic power, but also our national
security. Countries which engage in close trading and
commerce with each other increasingly align around common
interests in global stability and security.
The Board is instrumental to the agency's day-to-day
operations, since it manages the Bank's reforms and approves
its transactions. The long-term reauthorization approved by
Congress in 2015 contained risk-management provisions that
require action or approval from Ex-Im Bank's Board of
Directors in order to be implemented, including the
appointment of a Chief Ethics Officer and the establishment
of a Risk Management Committee. The agency cannot implement
those provisions--or consider any other reforms--without a
quorum. We urge the Senate to move swiftly on the pending
nomination for the Ex-Im Bank's Board of Directors.
Sincerely,
David F. Melcher,
Lieutenant General, USA (Ret.), President & CEO, Aerospace
Industries Association.
Craig R. McKinley,
General, USAF (ret), President & CEO, NDIA.
Ms. CANTWELL. Mr. President, I am on the floor with my colleague from
North Dakota because we feel passionately about this issue. We are
frustrated with the shenanigans that have gone on with the export
credit agency. I say ``shenanigans'' because for a long time people
said: Oh, well, there aren't the votes. We can't get this done. We
don't have the votes.
Well, when you lift the veil behind some very conservative,
threatening tactics, there is majority support, in both the Senate and
the House of Representatives, for this export credit agency.
Now, one committee is trying to bottle up a nominee--if he doesn't
like the nominee, come up with a different name. Come up with two
names. Who cares? But what really is happening is that those on the
other side of the aisle are enabling one individual to thwart the
biggest manufacturing economic opportunity our country has to secure
manufacturing jobs in the United States of America. Let's build great
products. Let's have a credit agency that can finance deals to
developing nations, and let's get those countries buying U.S. products.
Why on Earth are we continuing these shenanigans so somebody can say to
the Heritage Foundation: I got you one more trophy for your shelf.
That is not what America is about. America is about competing,
succeeding, and growing economic opportunity.
I thank my colleague from North Dakota for her leadership on the
Banking Committee in trying to move this effort forward and all of my
colleagues who care about manufacturing who are willing to come to the
floor and make this point.
Time is running out this session, before the summer recess, for us to
get this done. It is time to get it done.
The PRESIDING OFFICER. The Senator from North Dakota.
Ms. HEITKAMP. I say thank you to my colleague from Washington.
Mr. President, the level of frustration we have over this issue is
unparalleled. We hear platitudes in the Senate.
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They usually start with: We believe in the will of the people. Let's do
the will of the people.
Guess what. We had this debate. We had the debate about whether we
should have an entity called the Export-Import Bank. We had that
debate. It was long fought. We shut down the bank for the first time in
60 years. We shut down the bank, stopping exports for the United States
of America, costing jobs in the United States of America.
We won that fight, and we didn't win it by a little. We didn't win it
by just a margin. We won supermajorities--supermajorities--in the
Senate and supermajorities in the House. When we were told the House
would never pass a stand-alone bill, they passed a stand-alone bill by
70 percent--70 percent--of the vote.
Doesn't that tell you the people of this country should have a vote
through their elected representatives? Today do you know what is
stopping that vote, the will of the people to have this entity, beyond
all of the arguments for why this entity is critically important? One
person--one person, for whatever reason.
This is why people have lost faith with their government. This is why
people don't believe we can get anything done here anymore--because
even though we fight the fight, even though we win the fight, we don't
win the fight because we need a quorum at the Bank to do any deal over
$10 million.
We have a nominee. You must say: Well, it must be a raving liberal,
right? This nominee? No, it is the Republican nominee who represented
and worked for one of the most conservative Members--in fact, an anti-
Export-Import Member of the House of Representatives. That is our
nominee. There is nothing wrong with this nominee. It is not our side
who is debating the legitimacy of a Republican nominee. It is not our
side.
How do we believe in manufacturing, believe in the American dream,
and believe we can be part of a global economy, when 95 percent of all
potential consumers in the world--guess what. They don't live here.
If we are going to be competitive, if we are going to be
participating in that global economy--which we must--then we must be
competitive. We cannot be competitive without an export credit agency.
It is just that simple, and we are not going to be competitive. So
don't say you are for trade or manufacturing, when you are not willing
to take a risk because some ideologue on the other side has decided
that is a black mark.
Earlier, Senator McCain made a passionate plea and Senator Lindsey
Graham talked about Heritage. Who is running this place? When the
Heritage Society can stop a deliberation by simply putting a checkmark
next to a piece of legislation and when once again we have this being
held up in the backrooms of the Senate--not openly, but in the back
rooms--who is running the place and who really believes in trade? Who
really believes in manufacturing? Who really believes in the middle
class?
I will tell you, my passion on this doesn't just come because I think
it is a horrible trajectory for the future, for the future of our
American economy, my passion on this comes when I hear stories. These
are real. They are not pretend stories. When I hear stories that ``We
are going to take our manufacturing out of this country.'' We are going
to lose jobs, and we are going to lose those jobs very quickly. In
fact, when we shut down the Bank, we already lost jobs--but we are
going to lose jobs.
Do you know what I think about? Because this is where I live. This is
where I am from. I think about that factory worker on the floor of that
manufacturing facility being given a pink slip and being told his job
is going overseas, her job is going overseas because they have a better
business climate.
Think about that. You have a good job, providing for your family,
believing you are doing everything right, and because of a simple
glitch here, because of, really, one person, that person is getting
handed a pink slip. Where is the accountability for that? Where is the
accountability to that family? When are we going to learn that it is
this disruption in American lives that has cost this body and this
Congress its reputation for no good reason?
I wish to close before I turn it over to my colleagues with just a
couple of statistics because, quite honestly, I get sick and tired of
the characterization that this only applies to large facilities like
Boeing, GE, and Caterpillar. I am tired of that. Let me tell you. In
North Dakota, we have 16 suppliers. These are small businesses. These
are people who have done creative things in an environment that you
wouldn't think would be successful. They are suppliers to Boeing. What
happens when Boeing cannot do a deal? What happens when Boeing moves
their operation someplace else and the requirement is that those parts
be manufactured in that country? What happens? Guess what. Those 16
manufacturers are injured. Those 16 manufacturers have their lives
disrupted, through no fault of their own, not because they didn't
produce a quality product, not because they didn't do everything they
needed to do to be successful.
Just last week, the Wall Street Journal reported that 350 high-paying
American manufacturing jobs are headed to Canada. That is a direct
result of the last reauthorization back in 2015. I think we can clearly
expect many more of these stories. I would ask my colleagues: Who is
going to go to that manufacturer or worker? Who is going to talk to the
children who now have a father who no longer has a job or a mother who
no longer has a job and say: Because someone told me, I am not going to
do it. I am not going to support you. I don't represent you. I
represent an ideology here.
This is a tragedy at so many levels. I guess I naively thought, when
you win, you win, and when you win by big majorities, you ought to win
for at least more than a day.
I stand ready to fight this fight. I stand ready to attach and do
everything I can to either get this nomination or to get a patch or
legislation that will, in fact, provide opportunities for the Bank to
function. I will do everything I can because when I go to bed at night,
I don't think about the Boeing and the GE executives. That is not whom
I think about. I think about that person on the factory line who is
working every day putting food on the table for their children and how
this dysfunction here is costing them their livelihood and their
security. That is a tragedy we can't ignore.
Mr. President, I yield the floor to my colleague from Indiana.
Mr. DONNELLY. Mr. President, I echo the words of my colleague from
North Dakota.
I have 6.5 million bosses in Indiana. These think tanks out here,
these other organizations, they are not my boss. That family who wants
to make sure there is a paycheck coming into the house, and all mom and
dad wants is a chance to go to work, they are whom we should be working
for--for the same people my colleague from North Dakota works for in
Bismarck, in Fargo, in Muncie, in Richmond, in Maryville, in Lafayette,
and all of these suppliers around my State whose jobs are dependent on
these export opportunities that we are walking away from by standing
against the Export-Import Bank.
Here we are again, on the floor of the U.S. Senate, talking about our
responsibility to do our job and to consider the President's nominees
to important Federal offices. The nominee we are talking about, Mark
McWatters, is a Republican nominee for the Board of Directors for the
Export-Import Bank, and we are all lined up on this side to support
him. It is the official export credit agency of the United States. It
helps American companies--so many in my State of Indiana--create jobs,
an opportunity, and a chance for people to go to work, put a roof over
their kids' heads, to be able to retire with dignity, and to be able to
compete in a global economy.
That is what this is about. Every other country you look at has one
of these export-import banks. It is helping their organizations, their
businesses, and their countries compete.
Each of us speaking today worked closely with Senator Heitkamp last
year to reauthorize the Bank. It was a strong, overwhelming bipartisan
vote in support of reauthorization. It demonstrated the need for this
entity that helps create American jobs at no cost to taxpayers and, in
fact, sends money back to the Treasury.
[[Page S3676]]
In 2014, the Ex-Im Bank supported 164,000 American jobs. That is
164,000 moms and dads who are able to have dignity, a job, take care of
their children, and be a tremendous credit to their community. That is
what this is about; $27.5 billion in exports and it returned $675
million to the U.S. Treasury. It creates jobs, reduces the deficit, and
spurs economic growth. Despite widespread support, our inaction here
keeps the Bank from being in operation. In order to approve certain
financing, the Bank needs a minimum of three Senate-approved Board
members. We have two.
McWatters' nomination has been pending in the Senate Banking
Committee for 5 months. All it takes is a vote. Requests to confirm the
nominee by unanimous consent have been rejected.
American companies are struggling to compete against foreign
competitors that benefit from currency manipulation, illegal trade,
intellectual property theft, and other foreign barriers. Yet a handful
of Senators are making life more difficult by not considering this
nomination. If we are not willing to stand up for our own companies,
for our own workers, then what are we doing?
It is disappointing that an important tool for economic growth isn't
being utilized simply because some in the Senate refuse to do our job.
The American people expect better, the American people deserve better,
and the workers of this country deserve better.
I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Utah.
Mr. LEE. Mr. President, what my distinguished colleagues from North
Dakota and Indiana are proposing is to unleash the Export-Import Bank
from the constraints under which it currently must operate and to begin
authorizing transactions above $10 million. Between 2007 and 2014, 84
percent of the Bank's subsidy and loan guarantee deals exceeded $10
million--84 percent--and the vast majority of those were given to the
wealthiest, most well-connected businesses in America that should have
no problem at all obtaining financing in the open market.
The Export-Import Bank represents so much of what the American people
resent and despise about Washington, DC. This is a Great Depression era
relic, one that lives on today and has grown into one of the most
treasured relics for favoring banks. It is a favored relic for well-
heeled lobbyists, big government, and politically favored businesses.
It is an 82-year-old case study in American corporate welfare, and for
some reason this Senate continues to support it.
Ex-Im has managed to live through more than 30 corruption and fraud
investigations into its system of doling out taxpayer-backed subsidies
and loan guarantees to foreign buyers of U.S. exports. In 2013, for
half of the financing deals within the Export-Import Bank's portfolio,
Ex-Im was either unable or unwilling to provide any justification
whatsoever connected to its mission. That is $18.8 billion in estimated
export value that apparently had no connection to Ex-Im's mission or,
if it did, Ex-Im didn't bother to offer that up.
Many of Ex-Im's supporters claim the Bank's main function is to
support small business. That sounds nice, but the problem with it is
that this claim doesn't stand up to even a modest amount of scrutiny.
Look at the institution's track record. Only one-half of 1 percent of
all small businesses in America benefit from Ex-Im financing--one-half
of 1 percent. And even that tiny figure may well be an overestimation,
may well overstate the case, because Ex-Im uses such a broad definition
of the term small business.
Confirming this nominee would allow Ex-Im to return to its old ways
of approving massive financing deals for the largest corporations, in
coordination with the largest banks, all with the backing of American
taxpayers.
Permanently ending the Export-Import Bank would be a small but
important and symbolic step toward restoring fairness to our economy
and fairness to our government. It would prove to the American people
that their elected representatives in Congress have the courage to
eliminate one of the many Federal programs that foster cozy
relationships between political and economic insiders, providing a
breeding ground for cronyism and for corruption. So long as this Senate
remains unwilling to close Ex-Im, we should, at the very least, make
sure it does not have the ability to further advance its cronyist
agenda.
If you want to talk about harming competitiveness, let's talk about
that. If we want to have that discussion, let's have that discussion
now. If you want to know what harms competitiveness in America,
including and especially the kind of competitiveness that has tended to
foster the development of the greatest economy the world has ever
known--the kind of competitiveness that makes it possible, where it
exists, for small businesses to make it onto the big stage--let's look
at Federal regulations.
Federal regulations are a big deal in this country. I remember being
appalled 20 years ago to learn the Federal regulatory system was
imposing some $300 billion a year in corporate compliance costs--
regulatory compliance costs. Those regulatory compliance costs might be
borne immediately and initially by big corporations, by small
corporations, mostly by businesses, but you know who pays for it? Hard-
working Americans. In fact, some have described this effect as sort of
a backdoor, invisible, and very regressive tax on the American people.
So when I first learned of this problem, I started thinking of it
this way. This is an additional $300 billion a year the American people
are essentially paying into the Federal Government because everything
they buy--goods and services--becomes more expensive. They also pay for
it in terms of diminished wages, unemployment, and underemployment, but
they do pay for it. And they pay for it disproportionately at the
middle and at the low end of the economic spectrum in America.
Unlike our actual tax system--our visible tax system--which is highly
progressive, our backdoor invisible tax system--our regulatory system--
is highly regressive. Some have estimated this regulatory compliance
cost--just complying with Federal regulations--today costs the economy
some $2 trillion a year, meaning this has multiplied roughly sevenfold
just in the last 20 years.
If you don't think that is a significant impediment to
competitiveness in America, I don't know what is. This is a problem.
And some have estimated that each and every American household pays
some $15,000 more each year for goods purchased simply because of
Federal regulations. This hurts competitiveness. So do our high tax
rates; these harm competitiveness.
So I stand with the senior Senator from Alabama and I support him in
his objection.
I thank the Chair.
The PRESIDING OFFICER. The Senator from North Dakota.
Ms. HEITKAMP. Mr. President, will the Senator from Utah yield for a
question?
Mr. LEE. Yes.
Ms. HEITKAMP. Mr. President, I share my colleague's concerns about
overregulation and the burden of regulation. I have been fighting
regulation that makes no sense here in Congress, and so I agree with
him. But that is not what we are talking about today. We are talking
about the Export-Import Bank.
I would ask my colleague: What percentage of all transactions at the
Export-Import Bank goes to small business, as defined by the Bank?
Mr. LEE. Mr. President, as my colleague is asking the question, I
assume she has the answer.
Ms. HEITKAMP. I do.
Mr. LEE. And I am sure she is prepared to tell us that.
Ms. HEITKAMP. Well, obviously, I do want to maybe make some points
that are contrary to some of the discussion that my colleague just had.
Ninety percent of all Ex-Im transactions are with small businesses
that are under $10 million. The amount of transactions over $10 million
is huge, I will give you that. But, again, we talk about the supply
chain that goes into those transactions over $10 million.
The Peterson Institute recently estimated the United States is losing
$50 million in exports each day this nomination is not confirmed.
We have had disagreements with the Senator from Utah over the Ex-Im
Bank--disagreements we debated when
[[Page S3677]]
we reauthorized the Bank. So I would ask the Senator from Utah: Why not
move the confirmation of McWatters to the floor so my colleague can
have a full-throated debate about the Bank? Why not have a full-
throated debate instead of hiding that nomination in the Banking
Committee and using that structure to thwart what in fact a majority of
both bodies of the Congress and the President have done when they
reauthorized the Bank?
Mr. LEE. I am grateful to respond to both points made by my
distinguished colleague, the Senator from North Dakota.
In the first place, as to the need to have a full-throated debate, I
welcome that. That is exactly what we need. It is what I have been
wanting to have for a long time. But last year, instead of having a
full-throated debate specifically about Ex-Im, we saw Ex-Im attached to
a much larger package--a much larger package that a lot of people were
determined to support, regardless of what else was in there. So a lot
of people voted for that package, regardless of how they might feel
about the Export-Import Bank. But as for a full-throated debate, yes,
that is exactly what we need. We would get that if we could actually
debate the reauthorization of Export-Import on its own merits, as we
should have done last year. We were deprived of that opportunity, so
now we are using every opportunity we can to have a real full-throated
debate. That is why we are doing this. That is exactly the reason we
need to do that.
As to the figure the Senator cited with respect to the percentage of
loans going to small business, sure, if one wants to talk about the
number of actual loans made, one can make that number look pretty good.
But look at the number that I think is more significant: Only one-half
of 1 percent of all small businesses in America actually benefit from
Ex-Im financing. That is a pretty significant deal when one looks at
how much of the lending authority in the total dollar amount the
Export-Import Bank supplies to larger businesses and to businesses,
regardless of their size, that could in fact obtain financing in the
open market.
Again, we are not back in the Great Depression anymore. This is a
Great Depression era relic. So regardless of what my colleague may
think about the Great Depression era dynamics at play that caused those
serving in this body and the House of Representatives in the 1930s to
put this program in place, we have other challenges today. And many of
those challenges are created by the government itself--by the
government being too big a presence within our marketplace, inuring
ultimately to the benefit of big business and harming everyone else.
Ms. HEITKAMP. Mr. President, I see other colleagues here ready to
make presentations, but I just want to make two final points.
If my colleagues want a full-throated debate, then move the
nomination onto the floor and out of the committee. Let's have the
debate. My colleagues are using the nomination to reemphasize and
relitigate the Ex-Im Bank. Let's do it.
In the meantime, let's appreciate that, in spite of everything that
is being said here, we need the Bank to be competitive. We need the
Bank to make sure that we can, in fact, manufacture in this country.
And that is something that gets lost in all the rhetoric.
I think one of the things we have an obligation to think about is all
those jobs that are going to go someplace else and all those Americans
who are going to stand in the line for unemployment benefits and who
are going to get their pink slips. And who in the U.S. Senate wants to
line up at the factory door as they are walking through the last time
and shake their hand and say: You know, too bad you lost your job.
So I yield the floor, and I intend to have further debate about the
Export-Import Bank.
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. REED. Mr. President, I would note that Senator Klobuchar is here
and she, I believe, wanted to participate in the discussion about the
IMF, but we shortly have a vote, and we would very much like to
proceed. The majority leader is here also.
I am prepared to speak now on the pending Reed amendment that we are
going to go to a vote on at 11:15.
Ms. MIKULSKI. We need to talk on the bill.
Ms. KLOBUCHAR addressed the Chair.
Mr. REED. Mr. President, I believe I have the floor.
The PRESIDING OFFICER. The Senator from Rhode Island has the floor.
Mr. REED. I yield the floor to the majority leader.
The PRESIDING OFFICER. The majority leader.
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