E1498 CONGRESSIONAL RECORD — Extensions of Remarks September 5, 2002 I ask you to consider the quiet heroes like sightful article by Andrew Grove, Chairman of I am proud of what our company has Don Wacks and the many thousands like him Intel Corporation. achieved. I should also feel energized to deal deserving of our respect and gratitude for Mr. Grove—a former Time Magazine ‘‘Man with the challenges of today, since we are in of the Year’’—grew up in communist Hungary, one of the deepest technology recessions making this country great. After all, where ever. Instead, I’m having a hard time keep- would we be without America’s many quiet he- where he experienced stigmatization and prej- ing my mind on our business. I feel hunted, roes? udice as the son of a businessman. After com- suspect— a ‘‘class alien’’ again. f pleting his Ph.D. at the University of California, I know I’m not alone in feeling this way. Berkeley, Mr. Grove joined the Research and Other honest, hard-working and capable HONORING THE DISTINGUISHED Development Laboratory of Fairchild Semicon- business leaders feel similarly demoralized CAREER OF DR. GORDON PETTY ductor. In 1968 he became one of the found- by a political climate that has declared open ers of Intel Corporation. Since then he has season on corporate executives and has let HON. BART GORDON continued to play a key role in the growth and the faults, however egregious, of a few taint success of the company, serving as President the public perception of all. This just at a OF TENNESSEE time when their combined energy and con- and CEO and today as Chairman of the IN THE HOUSE OF REPRESENTATIVES centration are what’s needed to reinvigorate Board. our economy. Moreover, I wonder if the re- Wednesday, September 4, 2002 In an article published in the Washington flexive reaction of focusing all energies on Mr. GORDON. Mr. Speaker, I rise today to Post (July 17, 2002) entitled ‘‘Stigmatizing punishing executives will address the prob- recognize the outstanding career of Dr. Gor- Businesses,’’ Mr. Grove points out that the lems that have emerged over the past year. don Petty, who has served his community of current rush to judge and condemn all cor- Today’s situation reminds me of an equally porate executives without discrimination in our serious attack on American business, one Smith County, Tennessee, with dedicated pas- that required an equally serious response. In sion. Dr. Petty opened the first licensed hos- country has made him feel like he was back in communist Hungary, where businessmen the 1980s American manufacturers in indus- pital in Smith County in 1951 and practiced as tries ranging from automobiles to semi- a physician in his hometown for 50 years be- were distrusted and stigmatized. conductors to photocopiers were threatened fore retiring. Mr. Speaker, I urge my colleagues—and all by a flood of high-quality Japanese goods Dr. Petty’s life is a perfect example of what Americans—to give heed to Mr. Grove’s produced at lower cost. Competing with it means to give back to your community. He thoughtful insight. We must understand that these products exposed the inherent weak- while there has been corruption among far too graduated from Smith County High School in ness in the quality of our own products. It many companies, this does not justify the vili- was a serious threat. At first, American 1938 and received a degree from Cumberland fication of the entire private sector or of every manufacturers responded by inspecting their College in 1941. He then served in the United business executive. As Mr. Grove indicates in products more rigorously, putting ever-in- States Navy as a communications officer on- his article, the best way to tackle this issue is creasing pressure on their quality assurance board a destroyer during World War II. He through corporate reform and ensuring a sep- organizations. I know this firsthand because continued to serve in the Naval Reserve for a this is what we did at Intel. aration of powers between the chairmen, the number of years after World War II and also Eventually, however, we and other manu- board of directors, the CEO, the CFO, and ac- received a medical degree from Vanderbilt facturers realized that if the products were countants, and all street analysts. Once these University in 1950. of inherently poor quality, no amount of in- positions are free to operate without con- spection would turn them into high-quality During Dr. Petty’s professional career, he straint—and are not occupied by the same goods. After much struggle—hand-wringing, served on a number of medical boards and person—corporations will be able to monitor finger-pointing, rationalizing and attempts associations, including the American Medical themselves much more effectively and can at damage control—we finally concluded Association, the Tennessee Medical Associa- hopefully prevent future scenarios similar to that the entire system of designing and man- ufacturing goods, as well as monitoring the tion and the Board of Trustees of Smith Coun- the one our country is currently facing. ty Memorial Hospital. He also participated in a production process, had to be changed. Qual- Mr. Speaker, it is important that in our rush ity could only be fixed by addressing the en- variety of civic organizations, which included to repair the serious flaws in our system of the Carthage Lion’s Club, the Carthage Town tire cycle, from design to shipment to the corporate governance, that we not create customer. This rebuilding from top to bot- Council and the Board of Directors of Citizen’s other problems that could be equally dam- tom led to the resurgence of U.S. manufac- Bank. aging to our national economy. I ask that Mr. turing. Dr. Petty’s grit and determination to serve Grove’s article be placed in the RECORD and Corporate misdeeds, like poor quality, are his country, his patients and his community I urge all of my colleagues to give attention to a result of a systemic problem, and a sys- are admirable and a testament to his exem- his thoughtful views. temic problem requires a systemic solution. plary life. I cordially congratulate Dr. Petty for I believe the solutions that are needed all fit STIGMATIZING BUSINESS serving each with dignity, honor and compas- under the banner of ‘‘separation of powers.’’ (By Andrew Grove) Let’s start with the position of chairman sion. I also wish him the very best in his well- I grew up in Communist Hungary. Even of the board of directors. I think it is univer- deserved retirement. though I graduated from high school with ex- sally agreed that the principal function of f cellent grades, I had no chance of being ad- the board is to supervise and, if need be, re- mitted to college because I was labeled a place the CEO. Yet, in most American cor- ANDREW S. GROVE URGES RE- ‘‘class alien.’’ What earned me this classi- porations, the board chairman is the CEO. SPONSIBLE CORPORATE RE- fication was the mere fact that my father This poses a built-in conflict. Reform should FORMS BUT AVOID STIGMA- had been a businessman. It’s hard to describe start with separating these two functions. TIZING BUSINESS the feelings of an 18-year-old as he grasps the (At various times in Intel’s history we have nature of a social stigma directed at him. combined the functions, but no longer.) Fur- But never did I think that, nearly 50 years thermore, stock exchanges should require HON. TOM LANTOS later and in a different country, I would feel that boards of directors be predominantly OF CALIFORNIA some of the same emotions and face a simi- made up of independent members having no IN THE HOUSE OF REPRESENTATIVES lar stigma. financial relationship with the company. Over the past few weeks, in reaction to a Separation of the offices of chairman and Wednesday, September 4, 2002 series of corporate scandals, the pendulum of CEO, and a board with something like a two- Mr. LANTOS. Mr. Speaker, during the past public feeling has swung from celebrating thirds majority of independent directors, few months our nation has watched in shock business executives as the architects of eco- should be a condition for listing on stock ex- and dismay as a growing number of corpora- nomic growth to condemning them as a changes. group of untrustworthy, venal individuals. I In addition, auditors should provide only tions have fallen into disrepute and many have have been with Intel since its inception 34 one service: auditing. Many auditing firms been thrown into bankruptcy because of cor- years ago. During that time we have become rely on auxiliary services to make money, porate financial fraud or unethical practices. the world’s largest chip manufacturer and but if the major stock exchanges made audit- The scandal has rightfully provoked public out- have grown to employ 50,000 workers in the ing by ‘‘pure’’ firms a condition for listing, rage, and Congress has taken up new legisla- United States, whose average pay is around auditing would go from being a loss leader tion to stem the further erosion of public trust $70,000 a year. Thousands of our employees for these companies to a profitable under- in our capital markets. As Members of Con- have bought houses and put their children taking. Would this drive the cost of auditing through college using money from stock op- up? Beyond a doubt. That’s a cost of reform. gress prepare to enter into negotiations over a tions. A thousand dollars invested in the Taking the principle a step further, finan- conference report on corporate governance company when it went public in 1971 would cial analysts should be independent of the in- and accounting reform legislation, I call to the be worth about $1 million today, so we have vestment banks that do business with cor- attention of my colleagues a particularly in- made many investors rich as well. porations, a condition that could and should

VerDate Aug<23>2002 05:49 Sep 06, 2002 Jkt 089060 PO 00000 Frm 00002 Fmt 0626 Sfmt 0634 E:\CR\FM\A04SE8.047 E05PT1 September 5, 2002 CONGRESSIONAL RECORD — Extensions of Remarks E1499 be required and monitored by the Securities Fallon Community Health Plan has four fore this House of Representatives and before and Exchange Commission. times been rated the number one health main- this Nation today; she lived life to the fullest, The point is this: The chairman, board of tenance organization in the entire country. It a public servant who worked diligently for her directors, CEO, CFO, accountants and ana- constituents and the State of Colorado. Claire lysts could each stop a debacle from devel- has long been looked to as a model of innova- oping. A systemic approach to ensuring the tive and affordable health coverage. It consist- Traylor will be missed, but her presence will separation of powers would put them in a po- ently scores highly in measures of quality of continue to be felt in the thousands of lives sition where they would be free and moti- medical outcomes. Fallon Community Health which she touched. vated to take action. Plan was also one of the five original health f I am not against prosecuting individuals plans to enroll Medicare beneficiaries, dem- HONORING ARMANDO DE LEON, responsible for financial chicanery and other onstrating how more comprehensive care than RECIPIENT OF THE 13TH ANNUAL bad behavior. In fact, this must be done. But Medicare alone provides could be delivered to tarring and feathering CEOs and CFOs as a PROFILES OF SUCCESS HISPANIC Medicare eligibles at an affordable cost. The class will not solve the underlying problem. LEADERSHIP AWARD Restructuring and strengthening the entire Health Plan continues to participate in the system of checks and balances of the institu- Medicare+Choice program and its Fallon Sen- tions that make up and monitor the U.S. ior Plan has an accreditation status of ‘‘excel- HON. ED PASTOR capital markets would serve us far better. lent’’ from the National Committee for Quality OF ARIZONA Reworking design, engineering and manu- Assurance. It is also a partner with the Fed- IN THE HOUSE OF REPRESENTATIVES facturing processes to meet the quality chal- eral Government in PACE, a program of all-in- Wednesday, September 4, 2002 lenge from the Japanese in the 1980s took clusive care for the elderly, and is in fact the five to 10 years. It was motivated by tremen- Mr. PASTOR. Mr. Speaker, I rise before you dous losses in market share and employ- only health maintenance organization in the today to recognize an outstanding citizen who ment. Similarly, the tremendous loss of mar- country with such a program. has been honored for his life-long dedication ket value from the recent scandals provides Fallon Community Health Plan is a relatively to Latino issues through which he has im- a strong motivation for reform. But let us small health care organization whose national pacted the lives of many in our community. On not kid ourselves. Effective reform will take influence far exceeds its size. We in Worces- September 6th, the Honorable Armando de years of painstaking reconstruction. ter are proud of its success and the contribu- Leo´n was honored by his peers at the annual Our society faces huge problems. Many of tions it makes to our community. Mr. Speaker, Profiles of Success Hispanic Leadership our citizens have no access to health care; I am proud to congratulate the people of some of our essential infrastructure is dete- Awards presentation in Phoenix, Arizona. This riorating; the war on terror and our domestic Fallon Community Health Plan for twenty-five event, coordinated by Valle del Sol, a local security require additional resources. At- years of service. non-profit community based organization, tacking these problems requires a vital econ- f kicks off National Hispanic Heritage Month in omy. Shouldn’t we take time to think Arizona and is now in it’s thirteenth year of through how we can address the very real PAYING TRIBUTE TO CLAIRE honoring worthy individuals. problems in our corporations without de- TRAYLOR Judge de Leo´n began a 32-year career in monizing and demoralizing the managers the U.S. Air Force Reserve as a judge advo- whose entrepreneurial energy is needed to HON. SCOTT McINNIS cate. After being admitted to practice in Ari- drive our economy? OF COLORADO zona, he worked briefly as a law clerk/bailiff. f IN THE HOUSE OF REPRESENTATIVES In 1965, Armando entered private practice in Phoenix, specializing in international law and HONORING THE 25TH ANNIVER- Wednesday, September 4, 2002 serving as general counsel and volunteer pro SARY OF FALLON COMMUNITY Mr. MCINNIS. Mr. Speaker, it is with great bono attorney for twenty non-profit organiza- HEALTH PLAN sadness that I speak here to recognize the life tions. and passing of Mrs. Claire Traylor of Wheat Armando served four years on the Phoenix HON. JAMES P. McGOVERN Ridge, Colorado. Mrs. Traylor was a state leg- City Council. He served on the Arizona-Mexico OF MASSACHUSETTS islator who worked diligently on behalf of Colo- Commission and on Federal Advisory Commit- IN THE HOUSE OF REPRESENTATIVES rado to promote fair and effective legislation tees to the U.S. Attorney General and INS throughout the state. Wednesday, September 4, 2002 Commissioner as well. He was appointed to Mrs. Claire Traylor served in the Colorado the Arizona Superior Court bench in 1983 with Mr. MCGOVERN. Mr. Speaker, I rise today General Assembly from 1982 to 1994, first in rotations on civil litigation, criminal, domestic to honor Fallon Community Health Plan and to the House and then in the Senate. One of her relations, and special assignment calendars. congratulate the men and women of that orga- most renowned accomplishments as a legis- He chaired the Court Interpreter Policy & Bilin- nization on the occasion of its twenty-fifth an- lator was her strong commitment to education. gual Forms Committee, and the Unified Extern niversary. Mrs. Traylor was a member of the Joint Budg- Program Liaison Committee of the Superior Fallon Community Health Plan was created et Committee and Chairwoman of the Senate Court and the Arizona State University College in 1977 in Worcester, Massachusetts, largely Appropriations Committee, she used her Posi- of Law. Upon retirement from the bench, he though the work of the physicians of Fallon tion to approve funding for the repair and re- returned to his hometown of Tucson, where he Clinic. The Clinic itself, the first group practice construction of buildings on college campuses. served as an adjunct professor at the Univer- in central Massachusetts, was founded in It was for these efforts that the Colorado sity of Arizona College of Law. 1929, the vision of John Fallon, M.D. The doc- School of Mines just recently announced plans Armando’s extensive community involve- tors of that group have provided high quality to recognize Mrs. Traylor by naming a building ment includes serving as general counsel and and compassionate medical care to several in her honor. Mrs. Traylor also fought hard for board member to the National Council of La generations of area residents, and have a healthcare legislation that would benefit all citi- Raza, referral attorney for the Mexican Amer- uniquely cooperative relationship with the zens of Colorado, including the poor and unin- ican Legal Defense and Education Fund, Health Plan. sured. board member of the Southwest Voter Reg- While mergers and consolidations have gen- Mrs. Traylor was a proud Republican who istration Education Project, memberships in erally ruled the health care world in the last understood the necessities of sound fiscal re- the Hispanic National Bar Association, Los few years, Fallon Community Health Plan has sponsibility. However, on any given issue she Abogados Hispanic Bar Association, the Phoe- continued as a locally-controlled, not-for-profit didn’t hesitate to follow her own principles and nix Hispanic-Jewish Coalition, and the League plan, one that truly lives up to the word ‘‘com- convictions. But no matter how difficult the op- of United Latin American Citizens. munity’’ in its name. In 1988, the Fallon Clinic position or how controversial the issue, it was He served as a General Officer and was and Health Plan partnered to establish the her integrity and reputation for fair dealing that awarded the Legion of Merit upon retirement Fallon Foundation. With the help of community won her the bipartisan esteem of her col- in 1991, as well as the Distinguished Service members, local businesses, and public offi- leagues. For all the legislative achievements Medal. cials, Fallon Foundation promotes a healthy that can be accredited to Mrs. Claire Traylor, Mr. Speaker, please join me in recognizing community through grants and other resources it will be her amiable personality, her gracious this outstanding citizen for his fine work and dedicated to direct services, education, and demeanor, and her impeccable character that dedication. Throughout his life Judge de Leo´n research. Fallon Community Health Plan is a we will remember the most. has been a long time advocate for the Latino valued civic partner in Worcester and other cit- Mr. Speaker, it is with genuine gratitude that community and he has been a great role ies and towns of central Massachusetts. I recognize the life of Mrs. Claire Traylor be- model for many.

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