America Competes Act--Continued

AMERICA COMPETES ACT--Continued -- (Senate - April 24, 2007)

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AMENDMENT NO. 936

Mr. SANDERS. Mr. President, I wish to discuss an amendment, amendment No. 936, which I have filed to this bill.

Mr. President, I ask unanimous consent to add the following Senators as cosponsors of this amendment: Senator Baucus, Senator Leahy, and Senator Lincoln.

The ACTING PRESIDENT pro tempore. Without objection, it is so ordered.

Mr. SANDERS. Mr. President, let me begin by commending the distinguished majority leader, Senator Reid, for introducing S. 761, the America COMPETES Act, and bringing it to the floor, along with the minority leader, Senator McConnell, Senator Bingaman, Senator Domenici, and a number of other Senators in a true spirit of bipartisanship.

There is no question the Congress has to do a better job in making sure the United States is able to compete in the global economy. The America COMPETES Act will begin to accomplish this important undertaking by doubling the investment in basic research at the National Science Foundation, the National Institute of Standards and Technology, and the Department of Energy's Office of Science in the next 5 to 10 years.

I am also pleased this bill will improve teacher training in math and science and help low-income students succeed in college preparatory courses. I applaud these provisions and thank my colleagues for working on this important piece of legislation.

But in my opinion, if we truly want to provide the tools necessary for American workers to compete in the global economy, much more needs to be done. That is why I will be offering this amendment, which I hope will attract bipartisan support.

This amendment is simple and it is straightforward. At a time when the United States has lost over 3 million manufacturing jobs, at a time when we are on the cusp of losing millions more of high-paying information technology jobs, this amendment would begin to reverse that trend by providing employees with the resources they need to own their own businesses through employee stock ownership plans and eligible worker-owned cooperatives.

Specifically, this amendment would authorize $100 million to create a U.S. employee ownership competitiveness fund within the Department of Commerce to provide loans, loan guarantees, technical assistance, and grants to expand employee ownership throughout this country.

Why is it so important for the Senate to provide incentives to expand employee ownership in this country? The answer is pretty simple: Employee ownership is one of the keys to creating a sustainable economy with jobs that pay a living wage. This amendment has the strong support of the ESOP Association, a nonprofit organization serving approximately 2,500 employee stock ownership plans throughout the country. Let me quote from a letter they recently sent to my office:

Your amendment is a modest first step in awakening our government to the fact that in the 21st Century the inclusion of employees as owners of the companies where they work in a meaningful manner should be a key component of any national competitiveness program. If the Senate adopts your amendment and it eventually becomes law, we assure you that the ESOP community will work constructively to ensure that the loan and grant program you propose works effectively to benefit the employee owners, the employee-owned companies, and our American economy.

The concept of an ESOP or a worker-owned company is not a radical idea.
Not only are there some 11,000 ESOPs in our country, but there are some major corporations that everybody is very familiar with, including Procter & Gamble and Anheuser-Busch, that are also ESOPs.

Interestingly, the Tribune Company, one of the major publishers in America, is in the process of becoming a 60-percent employee-owned company.

Every day we read in the papers about plants that are being moved to China, Mexico, and a number of other low-wage countries. Since a number of these factories were making profits, they were doing well in the United States. Shutting them down was unnecessary and could have been avoided if these plants were sold to their employees through ESOPs, or worker-owned cooperatives. In other words, in my State, the State of Vermont, and throughout this country, there are companies, large and small, that are making a profit where owners--who may be retiring, who started a company and now they are retiring--want to be able to leave their companies to their employees if these workers had the resources, if they had the technical assistance and legal advice to know how to put together that transaction--which in many cases is pretty complicated.

Further, study after study has shown when employees own their own companies, when they work for themselves, when they are involved in the decisionmaking that impacts their jobs, workers become more motivated, absenteeism goes down, worker productivity goes up, and people stay on the job for a longer period of time because they are proud of and involved with what they are doing.

Most important to the communities throughout this country is when workers own the place in which they work, shock of all shocks, they are not going to shut it down and move the plant to China.

Since 2000, the U.S. manufacturing sector has lost 3.2 million good-paying manufacturing jobs. Put another way, since President Bush was elected President, this country has seen one out of every six factory jobs disappear--one out of every six.

In addition, the Associated Press recently reported a study by Moody's which found: ``16 percent of the nation's 379 metropolitan areas are in recession, reflecting primarily the troubles in manufacturing.''

I suspect this problem is even worse in rural areas in my own small State of Vermont. We have lost about 20 percent of our manufacturing jobs in the last 5 years. Let me give an example of some of the jobs we have been losing as a country and why, in fact, we need to be competitive and why, in fact, we need to encourage ESOPs and worker-owned industry. From 2001 to 2006, the United States of America has experienced a loss of 42 percent of our communication equipment jobs, 37 percent of our jobs have been lost in the manufacture of semiconductors and electronic components, 43 percent of our textile jobs have disappeared, and about half of our apparel jobs have vanished.

Not only are we losing good-paying manufacturing jobs, we are also losing high-paying information technology jobs.

While the loss of manufacturing jobs has been well documented, it may come as a surprise to some that from January of 2001 to January of 2006, the information sector of the American economy lost over 640,000 jobs, or more than 17 percent of its workforce.

The trends there are pretty ominous. Alan Blinder, the former Vice Chairman of the Federal Reserve, has recently concluded that between 30 million to 40 million jobs in the United States are vulnerable to overseas outsourcing over the next 10 to 20 years. While, of course, we have to invest in math and science, of course, we have to educate our students as best we can, we cannot ignore the significant impact globalization is having on our blue-collar factory jobs and on our white-collar information technology jobs.

Today there are some 11,000 employee stock ownership plans, hundreds of worker-owned cooperatives, and thousands of other companies with some form of employee ownership. Many of them are thriving. In fact, employee ownership has been proven to increase employment, increase productivity, increase sales, and increase wages in the United States. Yet despite the important role that worker ownership can play in revitalizing our economy, the Federal Government has failed to commit the resources needed to allow employee ownership to realize its true potential, and that is why this amendment is so important.

While this issue may be new to this bill, I have actually been working on it for several years. In the House, when I was the ranking member of the Financial Institutions and Consumer Credit Subcommittee, I was able to hold a hearing on this issue nearly 4 years ago and we had some wonderful testimony.

I fear in the next 10 to 20 years, if we do not change course, there will not be a major automobile industry in this country. We must not allow that to happen. We must protect good-paying jobs in this country. I believe employee ownership may be one of the ways we can keep good-paying jobs in America.

Let me conclude by saying in my opinion it would be much more important to provide this assistance to employees who could be creating and retaining jobs right here in the United States by the expansion of employee ownership. This is a very important issue. There is a lot of excitement all over the country about it. Let us protect American jobs. Let us give working people in this country the opportunity to own the places in which they are working. Let us make this country more economically competitive. I very much hope my colleagues will be supporting this amendment when it is offered.

I yield the floor.

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