tv Key Capitol Hill Hearings CSPAN May 20, 2014 4:00pm-6:01pm EDT
issue. thank you. thank you, mr. president. mr. levin: mr. president? the presiding officer: the senator from michigan. mr. levin: mr. president, along with 16 cosponsors, i have introduced and i am introducing today the stop corporate inversions act of 2014. this legislation is designed to address a loophole which unless we close it will be used to unleash a flood of corporate tax avoidance that threatens to shove billions of dollars in tax burden from profitable multinational corporations onto the backs of their american competitors and other american
taxpayers. the issue that we seek to address is known technically as corporate inversion. the details of inversion sound complex, but the principle is not. inversion means avoiding potentially billions of dollars in u.s. taxes by changing a corporation's address for tax purposes to an offshore location. what we have here is a taxable scheme, an enormous loophole that allows companies to avoid billions in taxes without any significant change in where they operate, where their profits are generated, where the location of the executives who manage and control these corporations. a recent prominent example involves pfizer, a u.s. drug company, and astrozeneca, a u.s.-based company.
this corporate takeover which pfizer makes abundantly clear is all about avoiding u.s. taxes has gotten a lot of attention and for good reason. it would cost the united states about a billion dollars a year in tax revenue. but this is not just about two companies. this is not just about one merger. even a merger that could shove billions of dollars in tax burden onto other u.s. taxpayers. the pfizer-astrozeneca deal is just the latest example of abusive inversion deals. you cannot pick up a newspaper's business section these days without reading about what reuters called -- quote -- "a wave of tax-driven overseas deal making." close quote. some companies that believe in meeting their tax obligationgations are under competitive pressure to avert and it's clear that dozens perhaps scores of companies are preparing to file their change of address cards and in doing so
avoid paying billions of u.s. taxes. that burden doesn't just go away. either our remaining constituents must pick up the tab or the loss of treasury revenue adds to the federal deficit. we tightened the rules regarding inversion schemes in 2004, and we did so promptly and on a bipartisan basis. but recent events show an enormous loophole remains, and so our bill seeks to address that loophole, and i hope once again we can do so promptly and on a bipartisan basis. essentially the problem that we have today is that a u.s.-based multinational can file a change of address card with the u.s. simply by acquiring an offshore company that is much smaller than the u.s. company. our bill would ensure that any inversion meets a much more stringent test. under current law, companies can pull off an inversion if such a fraction of their stock, just
over 20%, is in the hands of the new stockholders overseas. our bill would raise that threshold to 50% or more. in addition, it would stop tax-avoiding inversions in cases where management and control remain in the united states. president obama's 2014 budget included a similar proposal which one expert told "the new york times" would -- quote -- essentially eliminate inversions as we know them. our bill provides for a two-year moratorium on tax avoidance through the use of inversions. why a two-year moratorium? this is a response to a number of our colleagues who have said that this is an issue which should wait for comprehensive tax reform. we all believe in comprehensive tax reform, or most of us do, but it's going to take time and it's uncertain.
these corporate inversions represent an immediate threat. our treasury is bleeding from these inversions and from other loopholes which corporations use to avoid paying taxes. this bill is first aid for the tax code and a two-year moratorium on inversion that is do not meet our tougher standard stops the bleeding while we debate the comprehensive tax reform that most of us believe is desirable. as of this moment, however, there is no comprehensive tax reform legislation pending in either chamber of congress. there is no debate scheduled. there is, in fact, not a single comprehensive tax reform proposal that has been formally introduced as legislation. that's not because no one in congress cares about tax reform. nearly everybody does. broadly reforming corporate taxes is a complicated and time-consuming process, but we just simply cannot wait.
multinationals are exploiting this loophole today. meanwhile, hardworking american taxpayers and small business owners and even large corporations that have to compete with the tax avoiders but believe that inversion is wrong for their companies and for america see their tax burden rise while our national debt grows. now, how do we look them in the eye and say -- quote -- we had a way to halt this gimmick, but we decided to wait for comprehensive reform that may or may not ever materialize. this is very similar to what congress did on a bipartisan basis a decade ago. then-senators baucus and grassley jointly declared that they were working on legislation to stop abusive tax inversions. the bill, along with chairman wyden -- this bill that we're introducing along with chairman wyden's announcement two weeks ago should make clear to companies that considering a tax aversion is a mistake because they are now on notice.
it's not going to gain them anything if a bill that prohibits the tax avoidance through inversion passes because the chairman of the finance committee has made it clear that such a bill is going to be effective as of may 6 of this year, regardless of when the bill passes. so companies are on notice. there is no use rushing to the door to invert, leaving the country to invert. it won't do them any good if the finance committee chairman has his way in either of these bills or other bills that set an appropriate date such as may 6 pass the congress. these multinational companies benefit from the safety and security that the united states government provides. our troops protect them. our intellectual property rights protections allow them to profit from their innovations. they benefit from federally funded research. they claim tax subsidies for their research and development.
they raise capital in u.s. securities markets. they are the envy of the world. thanks to the rule of law that this government protects. in the last four years, one of the companies at the center of this debate, pfizer, received more than $4.4 billion in taxpayer money for federal contracts. just last month, the centers for disease control and prevention awarded pfizer a $1.1 billion contract. yet, that company and others are now poised to shortchange uncle sam by billions of dollars simply by changing their address for tax purposes. i'm sure most of our constituents wish that they could do that. michigan taxpayers can't reduce their tax bill with the stroke of a pen. michigan small businesses can't pretend that they're based offshore for tax purposes. there's no pretense that any of these corporate inversions make sense from any standpoint other than avoiding u.s. taxes.
that's their motivation, and these companies aren't shy about saying so. they will continue to operate in the united states. the executives who manage them will continue to live and work in the united states. they will live under the umbrella of protection that our men and women in uniform provide. at the same time, they are cutting support to those same men and women because of the deficits that these tax avoidance schemes have helped to create. few even try to defend these inversions on principle. they are simply tax avoidance. even the corporate executives who engineer them make little pretense as to any other purpose. so let us reform the tax code, yes. while we craft and debate that reform, let us stop these transactions that add massively to our deficit and to the burden that america's working families and small businesses must carry. mr. president, i would ask unanimous consent that the bill that we're introducing be
a senator: mr. president? the presiding officer: the senator from indiana. a senator: thank you, mr. president. in recognition of memorial day, i'd like to take a moment to honor and remember three hoosier service members -- the presiding officer: the senate is in a quorum call. we're in a quorum call. mr. donnelly: i ask that the quorum call be waived.
the presiding officer: without objection. mr. donnelly: thank you, mr. president. in recognition of memorial day, i'd like to take a moment today to honor three hoosier service members we lost in the last year. we remember army staff sergeant jesse williams of elk hart, killed in action after his blackhawk helicopter crashed in afghanistan on december 17, 2013. staff sergeant williams attended elkheart central high school and completed basic training in 2006. he was deployed three times, once to iraq in 2007 and twice to afghanistan in 2010 and 2013. staff sergeant williams is survived by his daughter and his parents, grandparents and siblings. his family accepted the purple heart on his behalf last month. we remember air force tech
sergeant dale mathews from rolling prairie, indiana, who died in a plane crash during a training exercise in england on january 7 of this year. tech sergeant mathews graduated from new prairie high school in 1994. he served tours of duty in both iraq and afghanistan. his service in the air force centered on flying rescue missions, taking care of others. and after serving almost 20 years, he was involved in the rescue of nearly 300 people. tech sergeant mathews is survived by his wife, his son, his daughter, his stepson, step daughter, and his parents and grandparents. and we remember army staff sergeant randall lane of indianapolis. staff sergeant lane passed away from a noncombat-related illness in afghanistan on september 13,
2013. staff sergeant lane served his country proudly in the marines and in the indiana army national guard for over 20 years. he is survived by his wife, his three daughters, his stepson, and his parents, brothers and sister and his grandmother. these men are all true heroes. they served their country with distinction. they made their family, friends, and all of the people of indiana proud and all the people of america proud. and i send my continued thoughts and prayers to their families. like these three men, the united states has a long history of self-hr-ts warriors -- of selfless warriors, men and women choosing to serve not because of the glory it brings to them but because of the freedom and safety it brings to others. and when one of them makes the
ultimate sacrifice by giving their life for ours, it's important we pause and we remember the true price of freedom. i was proud to see my fellow hoosiers come together in reflection and remembrance when we lost these three american sons, and i'd ask that we do the same this memorial day. may god bless the united states of america. thank you, mr. president. and i yield back. mr. barrasso: mr. president? the presiding officer: the senator from wyoming. mr. barrasso: thank you, mr. president. mr. president, this week president obama told a group of campaign donors that people who still talk about his health care law, as he said -- quote -- "are not speaking to the real concerns" he said that people have. the president still does not
seem to understand that americans do have real concerns about his health care law. and these aren't partisan concerns, mr. president. they're practical concerns. and the reason americans are worried is because the law directly impacts their personal lives, their personal health, their personal pocketbooks. that's why i've come to the floor week after week to talk about some of the alarming side effects of the president's health care law. and there are many alarming side effects related to the law that people are seeing in dealing with in their everyday life. i've talked about how this law has increased premiums, how it's cut paychecks for many families, how week after week more people are realizing that they're suffering as a result of the law. not helped by the law, but suffering as victims of the
president's law. so today i want to talk about another costly side effect of the law, the massive amount of taxpayer dollars that continue to be waste under the law. for example kmov television station in st. louis recently reported about a call center in missouri that processes paper applications for insurance in the state exchanges. remember the applications were supposed to be handled on a web site, so they shouldn't really need a call center handling their many paper applications. it doesn't seem to matter. the company got a contract for $1.2 billion. according to the report, there are about 1,800 employees. what are these people doing who are taking all of this money? turns out a lot of them aren't doing very much. these are taxpayer dollars and they're not doing very much. one employee said, "there are
some weeks that a dataen try person would not -- a data entry person would not process a single application." weeks, not a single application. "they are just sitting there looking at their computers, some of them are playing pictionary funded by the taxpayers." another employee told the associated press, "it was like stealing money from people. it was like stealing money from people." it's not just happening there in missouri. another tv station, kolr, found a call center run by the same company, this one working in arkansas. and the tv station reports the same exact thing happening in arkansas that's happening in missouri. one employee told the station that he's been there six months and over six months getting paid, full-time work, has processed a total of 40 applications.
to make matters worse, we've learned of another clear way that washington is wasting taxpayer dollars while implementing the law. over the weekend, "the washington post" reported that the federal health care subsidies may be too high or too low for one million people. health payouts may be wrong. health payouts may be wrong. subsidies too high or too low for one million. government flags errors, but can't fix them yet. incredible incompetence on the part of this administration. mismanagement like people have never seen before in this country. as the "post" reported, the problem means that potentially hundreds of thousands of people are receiving bigger subsidies than they deserve. these are the subsidies some people get to help pay for the insurance in the government exchanges. turns out that the computer system that washington built to
make sure it gave the right subsidies, well, guess what, mr. president? it doesn't work. now, when the healthcare.gov web site crashed last fall, the obama administration scrambled to patch it together, duck tape it, put it all together, but according to the article behind the scenes, important aspects of the web site remain defective or simply unfinished. so the article goes on. "the government may be paying incorrect subsidies to more than one million americans for their health plans in the new federal insurance marketplace, and has been unable so far to fix the errors." this is according to internal il documents and three people familiar with the situation. the problem means potentially hundreds of thousands of people are receiving bigger subsidies than they deserve. so the government can't fix it. web site can't be fixed. what do they do? these people are sending in
information, and according to this article, piles of unprocessed proof documents are sitting in a federal contractor's kentucky office, and the government continues to pay insurance subsidies maybe too generous. the inability to make certain the government is paying correct subsidies is a legacy of computer troubles that crippled last fall's launch of the obama health care law. so again, we see more waste of taxpayer dollars, more reasons for americans to have very real concerns about the law. the president of the united states just this past week told donors, not speaking to the real concerns that people have. mr. president, the president of the united states is wrong. the american people have real concerns about these components of the health care law. now, president obama said to the democrats in this very body, he
said democrats should forcefully defend and be proud of the health care law. i want to see one of the democrats stand up and defend what i've just talked about and be proud of what i just talked about. the president says you should. where are you right now? not one of them, mr. president, is here to make that defense or to stand proud about this law. you know, it's hard to imagine that my colleagues can possibly be proud of this law that pays people to do nothing all day long. can they possibly be proud of a law that awards large subsidies for people who don't qualify for them? are the democrats who voted for this health care law ready to forcefully defend all the taxpayer dollars that continue to be wasted every day? there is no effort in sight. there is no effort to stop this. after all, how does that provide a fair shot for everyone? s-pbtd that what the -- isn't
that what the promises of the president are? he said i want a fair shot for everyone. how does that actually help all this wasted money? how does that help anybody get better health care? millions and millions wasted, paying people to sit around and play computer games. millions more on web sites designed in states that have been basically looked and called, broken, dysfunctional, crippled. you name it, not working. the f.b.i. is investigating some. how does that give anybody better health care, all this wasted taxpayer dollars? the people know what they wanted with health care refume. they wanted better access to quality, affordable health care. they want access, they want affordable care, they want choices of which they've been denied under this president's health care law, and they want quality. that's the kind of fair shot they wanted, but it's not what they got from the president's
health care law. now, republicans have offered a patient-centered approach, an approach that would solve the biggest problems families face: access to care, cost of care, quality of care, and choice. that means things like allowing small businesses to get together, pool together mure inr to buy insurance more cheaply for their employees. that gives small businesses and the employees working in workia fair shot. it means letting people shop for health insurance that actually works for them and their families, not what president obama says is best for them. if i had to say who knows the best what works best, it's more likely the families rather than president obama and the democrats that passed this law. people deserve a fair shot at buying a plan that's best for them, best for their families. these are just a couple of solutions that republicans have offered to give americans real health care reform and a real fair shot.
health care reform that gives patients the indicator they need from a doctor they choose at lower costs without the ongoing harmful, expensive side effects that we're seeing every day by the president's health care law. thank you, mr. president. i yield the floor. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:
hatch match mr. president, i ask unanimous consent that the quorum call be dispensed with. the presiding officer: without objection. hatch mr. president, i rise today to -- i ask unanimous consent that i be permitted to finish my remarks. the presiding officer: without objection. mr. hatch: i rise today to discuss a critical issue facing this body and this country. the occasion for my remarks happens to be the nomination of sylvia math use this burwell to head the department of health and human services. as the ranking member on the finance committee, i've taken a great deal of interest in her nomination and participated in her confirmation hearings.
i'm fraid that the cordial nature of our exchanges and my recognition of ms. burwell's qualifications has allowed some to being a nounal that the affordable act is working. let me gist be absolutely clear on this point. i oppose obamacare, and i'm going to fight as long as it takes to repeal that misguided law and replace it with a system that actually works for american families. that's why i've collaborated with cephal of my colleagues to unveil a framework for the patient care act, a plan that would repeal obamacare and replace it with common sense, patient-centered reforms that reduce health care costs and increase access to affordable, high-quality care. it would save the taxpayers about d 1 trillion. and yet have a better health system than we have today with obamacare. let me also be clear on another point. no matter what the
administration say, the relate city that obamacare is not working. the president and his allies are claiming that the law is a success because the administration has mostly corrected the botched rollout of healthcare.gov and has had a certain number of individuals sign up as if forcing people into obamacare under the coercive threat of government penalty is somehow cause for celebration. in reality, the mass cancellation of insurance coverage last fall was just the first -- the first prick of pain obamacare will inflict on the american people. i could talk for hours about rising premiums, growing deficits, backdoor bailouts and of course numerous other mall -- all of which threaten the quality and enforceability of health insurance for so many americans already struggling through the obama economy. but, mr. president, the concern that moat vats me to speak her -- that motivates me to speak
here today goes beyond the many failures of obamacare aes a matter of policy. perhaps most troubling of all habit unlawful manner in which this administration has gone about implementing it. when faced with the prospect of enforcing disruptive features of this signature law, the president has chosen to ignore his fundamental obligation to enforce the law and has instead sought to rewrite various provisions of obamacare unilaterally. these actions form a troubling pattern of lawlessness and executive overreach by the obama administration. one that all citizens and all members of this esteemed body, whether republican or democrat, ought to condemn and resist. the harms i will discuss today are not just a theoretical distraction. this administration abuse is a very real threat to our constitutional system of government and to the liberties that each of us enjoy. in recent weeks, i've come to the senate floor on a number of owe cautions to speak --
occasions to speak out about the obama administration's lawlessness in a wide variety of contexts. i will continue to do so to defend the separation of powers, the rule of law, and the legitimate prerogatives of the legislative branch and this body in particular under the constitution. even in light of these serial abuses that have only accelerated under the president's pen-and-phone strarkts the implementation of obamacare stands out as the crown jewel of executive overreach. by my count, this administration has acted unilaterally on at least 22 separate occasions to alter the law. something it does not have the right or power to do. through its actions, the obama administration and in particular the current health and human services secretary, has demonstrated cavalier disregard
for the constitutional obligations of the executive branch. and the president and his team have shown outright contempt for the legitimate role of congress. today i would like to highlight just a few of the obama administration's most egregious acts and explain why these actions are unlawful and pose such a serious threat to our constitutional system of government. mr. president, let me begin with something that most americans unfortunately remember all too well -- president obama's now infamous promise gnaw like your plan you can keep it. this promise was the key selling point for obamacare, which was approved by the senate by a raiser-thin party-line vote. without the president's assurance that americans could keep their current health plans in they wished, the bill simply would not have passed this chamber. yet it has long been clear that
the white house never intended for americans to be able to keep their prepared plans -- preferred plans. i don't say that lightly. it isn't some unsubstantiated partisan attack. it is a well-documented fact. from the very beginning, one of the key promises -- or premises underlying obamacare's government takeover of health care was the notion that americans couldn't and shouldn't be trusted to choose their own health insurance and that instead washington's so-called experts could be taxed -- tasked with determining the sort of coverage americans could buy. indeed, mr. president, that's the entire point of having the minimum coverage provisions that the obama administration fought so hard to include in the bill. if americans' existing plans don't comply with some government official's specifications, then obamacare
forces individuals off of their insurance. to put the president's more honestly, if he likes your plan, you can keep it. several respected news outlets have responded how policy aides within the obama white house objected to the president's obviously inaccurate claim that if you like your plan, you can keep it. only to be overruled by the president's appointed political advisors. despite knowing that it was false, the administration purposefully perpetuating this dishonest claim. tragically, millions of americans relied on the president's promise only to face the prospect of having their health insurance plans canceled after his reelection. to make matters worse, the administration didn't settle for the natural attrition that would eventually force americans with the plans they liked to buy an
additional level of coverage, one that they didn't want, but one that obamacare forced them to purchase. no, instead, the administration rushed to publish regulations that defined exactly which existing plans could be grandfathered into the new scheme, and the regulatory definition of so narrow in scope that even a minor or routine change to an existing plan could disqualify it. as the solicitor general recently conceded to the supreme court, obama administration officials knew that the number of qualifying individuals would be -- quote -- "very, very low" because it's to be expected that employers and insurance companies are going to make decisions that trigger the loss of the so-called grandfathered status under the governing regulation." unquote. given the president's broken promise and the many canceled
plans, i joined with a umin of colleagues -- a number of colleagues and moved quickly to use our power under the congressional review act to try to overturn these regulations. unfortunately, every single one of my colleagues on the other side of the aisle voted against providing this relief. what followed was tragic but entirely predictable. insurers were forced to cancel policies and millions of americans were unable to keep the plans had a they liked. when obamacare's failed social engineering became a reality in the wake of millions of cancellation notices that went out last fall, even staunch supporters felt the intensity of the inevitable public outrage. many in this body were able to support legislation that offered relief to constituents sufficing from this latest dose of the obamacare plan. the house of representatives passed legislation with the
bipartisan support of more than three dozen democrats that would have allowed insurers to continue to offer the plans that millions of americans had chosen to purchase. yet once the chorus of public outrage got so loud that even president obama could no longer ignore obamacare's destructive effects, what did do? did he try to work with the bipartisan majority in congress to provide relief to the hardworking americans injured by obamacare's forced cancellations? did he move to rescind the administration's aggressive regulations? or did he bite the bullet and enforce the law as written, demonstrating that he was willing to endure nonpopularity in order to live up to his obligations under the constitution? unfortunately, president obama chose none of these legitimate approaches. instead, his department of health and human services simply acted unilaterally to cancel and
then rewrite the minimum coverage requirements in the statute. after doing so, h.h.s. simply cited the vague notion of transitional relief as the only possible suggestion of where the administration could find executive authority to refuse to enforce clear statutory law. in reality, this action represents a shocking and radical abuse of power by this administration. mr. president, let me offer some background to context tourallize just how -- con sphex ouraliz this just how this is in this instance. in enforcement of this nation's tax laws, the i.r.s. has for some time claimed the authority to adjust how a new tax is phased into operation, providing a slight delay and enforcement to ease the administrative burden imposed by the new tax.
the i.r.s. has engaged in this practice of adjusting enforcement timing with some regularity through the use of this assertive authority, tend to be narrow, for example, by delaying the aviation of a fuel excise tax by just 16 days. but, please, the obama administration's attempts to fix the failed bailout from its "if you like your plan you can keep it," lie, doesn't even involve tax law. nor does it involve the i.r.s.'s past practice or its claimed legal authorities. the department of health and human services simply invoked the claimed powers of the i.r.s. in a wholly distinct context, a context in which it couldn't point to statutory authority or a similar history of past practice. in the absence of clear authority to alter or cancel
enforcement, the president remains constitutionally obligated to take care that the laws be faithfully executed. in this case, the obama administration doesn't have a leg to stand on. the sort of transition relief here is nothing like a minor 16-day delay. enforcement to enforce -- or, excuse me, the failure to enforce the minimum coverage provisions will now drag on for three full years past the required statutory deadline. and the administration's fix is different in kind from prior examples of transitional relief because in this case the government did not actually face enforcement difficulties. insurance companies that already complied with the statute by canceling millions of plans, just as the law required them to do.
in fact, precisely the opposite was true. what finally motivated the administration to act was instead the public backlash generated from proper compliance with the law. no matter how much the obama administration may want to mitigate the disastrous effects of its own signature law, neither h.h.s. nor any other part of the executive branch has legitimate authority in the form of prosecutorial discretion or otherwise to ignore or rewrite a federal statute. in the words of the justice department's long-standing position, the president may no not -- quote -- "refuse to enforce a statute he opposes for policy reasons." but that is precisely what the obama administration has done in this case. the whole idea of administrative
transition relief is premised on the notion that such action is properly derived from or at the very least is consistent with relevant statutory authorities. here the administration's action directly contradicts the plain language of the statute which obligates insurance companies to offer only plans compliant with the statute's requirements and which obligates state and federal governments to enforce those requirements. a generic brand of regulatory authority cannot provide the executive branch with unilateral power to rewrite effective dates made explicit in the statute. this is especially true of obamacare since, as we were told repeatedly during the debate over the law, the precise effective dates for various intertwined provisions were deemed central to the effectiveness of the entire
statutory scheme. mr. president, all this is to say that the obama administration's actions in this area far exceed any transitional relief authority the president might rightfully claim and instead amount to a vast illegitimate misuse and abuse of power by the executive branch. the constitution obligates the president to follow the law. it also commands him to -- quote -- "take care that the laws be faithfully executed." meaning, he must ensure that others subject to his authority comply with the law. in this case, president obama has not only rejected his own obligation to follow and enforce the law but he is also permitting, even urging, states to disobey their obligations to enforce obamacare. he is likewise actively encouraging insurance companies to offer plans that violate the
company's explicit obligations under the minimum coverage requirements and he is encouraging consumers to participate in and rely on this lawlessness by purchasing what are, in fact, unlawful policies. such executive lawlessness should be troubling to all americans, regardless of political stripe or partisan affiliation. it is the constitution, the political institutions it established, the legal framework it enshrined, the checks and balances it requires that ensure -- ensures that we remain a government of laws and not of men. absent these essential restraints, we will all become subject to increasingly arbitrary rule, a government that knows no bounds and seeks to regulate and control virtually every aspect of our lives. sadly, mr. president, this is just one example of the administration's lawlessness in implementing obamacare.
it gets worse, though. consider the individual mandate. i firmly believe that the individual mandate constitutes an unprecedented and unconstitutional overreach that, in the words of supreme court justice anthony kennedy -- quote -- "changes the relationship of the federal government to the individual in a very fundamental way." but even as we seek to repeal and replace obamacare, for now the individual mandate is the law of the land. the president who fought so hard to impose this terrible burden on the american people through the legislative process and in the courts is bound to enforce it. yet when it came time to implement the individual mandate which the administration long argue you'd because the linchpin of the entire obamacare scheme, and -- quote -- "essential to creating
effective health insurance markets"-- unquote, the administration simply decided that enforcing that provision as written in law no longer suited their interests. again, i ask, mr. president, did the obama administration seek to work with congress to relieve this burdensome mandate? of course not. as has become his habit, the president once again chose to act unilaterally, stretching a statutory and constitutional authority to the breaking point in an effort to avoid engaging in legislative process, the only legitimate means of revising the individual mandate. let me reiterate that i abhor obamacare's individual mandate. i want to repeal it. along with the rest of the affordable care act. so that no longer -- so that it no longer infringes on the liberties of any american. but, madam president, either implementing or repealing the
individual mandate must be done lawfully, not by executive fiat. the administration sought to justify its unilateral action to delay application of the individual mandate on the basis of obamacare's hardship exemption. but in an announcing the delay the administration determined it would exempt anyone who simply completes a the hardship form, indicates their current insurance policy is being canceled and considers other available policies unaffordable. such a standard as the very definition -- is the very definition of lawlessness and contradicts the letter of the law. indeed the twhows and its supporters in congress drafted exemptions -- or exceptions excuse me, to the individual mandate, very narrowly to make it as universal as possible. although the statute gives the h.h.s. secretary some flexibility in granting hardship
exemptions, the plain text. law specifies precisely when a health plan is unaffordable, when it costs 8% or more of household income. by granting an exemption to anyone who subjectively thinks that available coverage is unaffordable, h.h.s. has made a mockery of the mandate, not to mention completely ignoring the affordable -- aforthability objectives standards. the administration has stretched beyond recognition the limited regulatory authority it does possess simply in order to you from enforcement of its prized individual mandate. the administration's unwillingness to enforce the individual mandate which lies at the very core of obamacare demonstrates not only how the bill has failed to live up to its lot ofy promises, -- lofty
promised, it shows how irresponsible the president has been in failing to live up to his constitutional obligation to take care that the laws, his signature law, no less, be faithfully executed. but, madam president, the administration's lawlessness does not end with the individual mandate. once again, it only gets worse. in massive law chock full of burdensome requirements, the administration has found it necessary to ignore mandates of all shapes and sizes. take also the employment. -- employer mandate. perhaps less public attention is focused on the administration's effort to dictate coverage requirement backed by stiff penalties to every american business with more than 50 employees. but this employer mandate would have devastating effects, first by discouraging small businesses from hiring and thereby leaving millions unemployed, second by forcing employers to cut their employees' work hours limiting take-home pay for millions of
current workers struggling to get by, and third, by discouraging many employers from even producing health insurance to their workers leaving millions of americans to fend for themselves. as the statutory deadline for implementing the employer mandate approached, even obamacare supporters feared these consequences and the administration once again unilaterally suspended its enforcement of the law. the first clue that the obama administration was up to something illegitimate came when h.h.s. announced its total suspension of the employer mandate in a backlog post euphemistically and ironically titled "continuing to implement the a.c.a. in a careful, thoughtful manner." that such a significant announcement was made using insidiously innocuous language, made via such an informal medium
came as little surprise given this administration's propensity towards flip pant and unaccountable governance by backlog post, hashtag, and selfy. in this case the announcement did not bother to identify any legal basis for suspending the employer mandate, and merely made passing reference to the limited concept of so-called transition relief. upon subsequent scrutiny, it became clear that the logic of transition relief simply doesn't apply here because congress and the president in passing the bill into law enacted an explicit statutory requirement detailing when the employer mandate must be implemented. by acting in direct contravention of this explicit statutory deadline, the power of the obama administration's
authority was as the supreme court has explained, -- quote -- "at its lowest ebb"-- unquote. with the president authorized to act only if congress has no constitutional power to act, but in this case, congress' power to lay and collect taxes is clearly enumerated in article one, section eight, of the constitution. in other words, the obama administration's unilateral action to suspend the employer mandate was lawless by any definition, including that of the supreme court. madam president, it did not have to be that way, and it should not have been that way. the broad bipartisan majority in the house of representatives acted to provide lawful statutory relief from the employer mandate. the house bill was strictly limited to changing the statutory deadlines for the employer mandate and its reporting requirements and the
bill changed those dates to match the timeline on which the administration announced it intended to begin enforcement. in other words, the thousands bill gave the administration the precise employer mandate delay it wanted and the bill contained none of the other policy changes that most republicans favor. what -- when offered the opportunity to delay the employer mandate in a lawful manner, what did president obama do? he threatened to veto it. and by doing so, the president conveyed in unmistakable fashion his prior to lies in political gamesmanship, that he has no respect whatsoever for his constitutional obligations. i wish i could say the obama administration's reckless and unilateralism in refusing to en. force the employer mandate anded there. sadly, it does not. a few months later the administration rewrote the employer mandate.
announcing it would delay enforcement for years and in some cases permanently, well beyond the precedents of past enforcement delays. but it still gets worse. rather than simply offering another blanket delay of the employer mandate, the obama administration went much further. officials announced that the mandate would only be enforced for businesses with 50 to 99 employees if those businesses failed to comply with the new onerous maintenance of work force regulation. that regulation prevents businesses from reducing the size of their work force or the overall hours of service of their employees unless they have a bona fide business reason acceptable to government bureaucrats. for businesses with more than 100 employees, the obama administration likewise suspended enforcement of the employer mandate until 2015, at
which time elected -- executive officials would replace the statutory requirement, requiring coverage for all employees with a new administrative formula for determining how many employees must be offered coverage. madam president, i could stand here all day criticizing the backwards logic and terrible consequences of having federal bureaucrats police the employment practices of our nation's small businesses. there are so many reasons why the employer mandate is bad policy. but i have come to the floor today to highlight the sheer lawlessness of these unilateral executive actions. in the case of the employer mandate, the law itself dictates when that law should be enforced. h.h.s. has not suggested that it lacks such resources to enforce the mandate, nor can it have considered the equity of
enforcement in individual cases when it's sweeps up every subject to this mandate and categorically refuses to enforce this law. instead the obama administration has simply abdicated its duty to enforce the law. even worse, it has usurped legislative authority by devising a wholly different scheme, a wholly different enforcement scheme with its own conditions, goals, and timeline, inconsistent with those prescribed in the statute. the executive abuses of this administration in implementing obamacare extend beyond the minimum coverage requirements and the individual and employer mandates. consider the unilateral use of the so-called demonstration project to divert attention from obamacare's cuts to medicare advantage. by providing seniors an alternative to transitional
medicare that takes advantage of market-based competition to enhance quality of care and cost-effectiveness, medicare advantage has proven proven an extraordinary success. i'm pleased to have played a role in its creation. in advancing president obama's now broken promise that his health care plan wouldn't add one dime to our deficits, the final obamacare bill mandated more than $300 billion, with a b, in cuts to medicare advantage over ten years. but the obama administration has had to grapple with yet another inconvenient fact. medicare advantage has become increasingly popular with each passing year. as of last year, nearly three in ten medicare beneficiaries chose it over traditional medicare. in my home state of utah one of these beneficiaries receives coverage -- one in three
beneficiaries receives coverage through medicare advantage. rather than advantage his blunder and ask congress to reverse obamacare's unwise and unpopular medicare advantage cuts, the president has once again taken unilateral action that makes a mockery of his signature law. his administration used a more than provision, one that allows the administration to demonstrate different bonus bateman models in pilot programs as a thickly veiled guise for delaying medicare advantage cuts ahead of an election. never mind the clear conflict between awarding the bonuses across the board and the statutory purpose of such demonstration projects to determine if the payment changes produce efficiency and economy. never mind the obvious absurd city thank you of pretending to use sued owe demonstration authority to -- pseudo
demonstration authority when such a demonstration is at least seven times larger than any other medicare demonstration conducted since 1995 and is greater than the budgetary impact of all those previous demonstrations combined. and never mind that the statutory authority for the demonstrations calls for budget neutrality. when i first learned of the obama administration's clear abuse of this narrow statutory authority, i asked g.a.o. to investigate. g.a.o.'s report confirmed that the administration had indeed exceeded its legal authority and recommended canceling the program because it wasted taxpayer money. still, the administration pressed forward simply ignoring its legal gabblations and usurping congress' constitutional power of the purse. i wish i could say that this move was surprising, but through a repeated pattern of
such actions, president obama and his administration have earned a reputation for executive arrogance and constitutional abuse. madam president, the list of fundamentally illegal actions by this administration in implementing obamacare goes on and on. for now let me mention just one more example where president obama has completely disregarded his obligation tony force the law and yet again sought to usurp congress' power to make trampling and spending decisions through threw the constitutionally ordained legislative process. the obamacare provision at issue in this instance is remarkably simple. it provides tax subsidies for individuals to purchase health coverage through an exchange -- quote -- "established by the state under section 1311." unquote. section 1311 is the provision of obamacare that allows states the option to create their own
exchanges, but section 1311 is not the provision that authorizes the creation of the federal exchange to operate where the states choose not to act -- that is, section 1321. i can't imagine how this provision could be any clearer. the law only authorizes subsidies in connection with state exchanges, not the federal exchange, and this was no accident. obamacare incorporated the principle of so-called cooperative federalism, a polite term for thinly veiled federal coercion and commandeering of the sovereign states. indeed, this fig leaf hiding federal dominance was critically important to rounding up 60 votes to pass obamacare in the senate. as my friend, the former senator from montana, now ambassador to china and a principal author of the obamacare text, noted during the finance committee markup of the bill, conditioning tax credits in this way was the only
means by which our committee could establish jurisdiction to demand rewriting state insurance laws as obamacare requires. but in the end, the federal government's own exchange ended up covering the majority of states. as written, the law does not permit subsidies in connection with the federal exchange. given these circumstances, did the administration choose to enforce the legislative compromises to which president obama agreed by signing the bill into law or did the white house seek to work with congress to address this disparity? of course not. yet again, h.h.s. chose to ignore the clear statutory restrictions and instead authorized billions of dollars in illegal subsidies through the federal exchange in direct conflict with the plain text of the law. this obvious abuse has been challenged in court, and after
hearing the judge's deep skepticism of the administration's case, i am confident that the u.s. court of appeals for the d.c. circuit will roundly reject the obama administration's radical arguments seeking to justify this lawlessness. i hope the court will hold the administration accountable for its deliberate and unmistakable violation of the law and that it will do so despite the effort by president obama and his allies to fill up the d.c. circuit with compliant judges who might overlook the administration's executive abuses. but whatever that or any other court determines as a matter of specific legal principle, the fact remains that obama administration officials and in particular the h.h.s. secretary have repeatedly and purposefully sought to undermine congress, usurp legislative power and become the law unto themselves. president obama came into office promising the most transparent
and accountable presidential administration in history. the obama administration has ended up being transparently lawless. madam president, today i have discussed only five examples of the administration's lawlessness in implementing obamacare. i will save for another day the significant legal concerns surrounding this administration's abuse of handling of high-risk pools, its actions involving the small business exchange, its sweetheart deals granting unauthorized exemptions for labor unions and many other similarly problematic actions, but even in the five examples i have mentioned today, the overriding point is clear. the tenure of president obama has amounted to an unmistakable pattern of executive abuse. time and again, his administration has flouted its constitutional responsibilities, exceeded its legitimate
authority, ignored the act of law and sought to escape any accountability for its executive overreach. madam president, such executive branch abuse cannot stand. whether republican or democrat, each of us has a sworn obligation to defend the constitution, and each of us has the responsibility to defend the rightful prerogatives of the legislative branch. i have long argued that obamacare unconstitutionally intrudes on our most basic liberties, but those liberties cannot be secured when the executive branch defies legal bounds and ignores its constitutional obligations. the continued well-being of our nation, the legitimacy of our republican self-government and the basic liberties of our fellow citizens depend on insuring that the exercise of executive power is properly kept within lawful bounds. doing so requires continual vigilance by the courts, by
congress and by the american people, especially in the face of such reckless lawlessness by the current administration. our nation needs new leadership. ultimately, we need to elect a new president in 2016, one who will respect the constitution and seek to protect the rights of citizens, but until then, we need an h.h.s. secretary who will uphold the law and respect the rightful prerogatives of the legislative branch. that's why i pressed miss burwell during her confirmation hearing last week about the administration's illegitimate and lawless actions and about the need for a different approach. no matter how cordial our debate, no matter her impressive qualifications, my overriding concern is that she be accountable to congress, to the law and to the constitution. madam president, i suggest the absence of a quorum. the presiding officer: the clerk will call the roll.
mr. reed: madam president? the presiding officer: the senator from rhode island. mr. reed: i would ask the call of the quorum be dispensed with. the presiding officer: without objection. mr. reed: madam president, i ask unanimous consent that if the senate receives the paper with respect to the conference report to accompany h.r. 3080, the water resource reform and development act by thursday, may 22, that at a time to be determined by the majority leader with the concurrence of the republican leader but no later than thursday, may 2 2, the chair lay before the body the conference report to
accompany h.r. 3080 and the senate proceed to vote on adoption of the conference report, that the vote on adoption be subject to a 60 affirmative vote threshold, further no motions or points of order be in order to the conference report. the presiding officer: is there objection? without objection, so ordered. morning business is closed. under the previous order, the senate will proceed to executive session to consider the following nominations which the clerk will report. the clerk: nominations, millennium challenge corporation, dana j. hyde of maryland to be chief executive officer. susan mccue of virginia to be a member of the board of directors. mark green of wisconsin to be a member of the board of directors. the presiding officer: under the previous order, there will be two minutes of debate equally divided in the usual form prior to a vote on the hyde nomination. mr. reed: madam president? the presiding officer: the senator from rhode island.
mr. reed: i ask consent to yield back all time on the hyde, mccue and green nominations. the presiding officer: is there objection? without objection. the question occurs on the hyde nomination. all in favor say aye. all opposed -- those opposed, no. the ayes appear to have it. the ayes do have it. the nomination is confirmed. the question occurs on the mccue nomination. all in favor say aye. all opposed say nay. the ayes appear to it. the ayes do have it. the nomination is confirmed. the question occurs on the green nomination. all in favor say aye. all opposed say nay. the ayes appear to have it. the ayes do have it. the nomination is confirmed. the clerk will report the costa nomination. the clerk: nomination, the
judiciary, gregg jeffrey costa of texas to be united states circuit judge for the fifth circuit. the presiding officer: there are now two minutes of debate equally divided on the nomination. the senator from rhode island. mr. reed: madam president, i ask unanimous consent to yield back all time for debate and i would ask for the yeas and nays. the presiding officer: all time is yielded back. is there a sufficient second? there appears to be. the clerk will call the roll. vote: