H1648 CONGRESSIONAL RECORD — HOUSE April 3, 2000 In 1996, Haider called ‘‘The government’s the need for compensation for victims of the As a survivor of the horrors of the Nazi re- so-called integration policy a disaster. They allies, Haider explained, ‘‘But we do not in- gime, he knows better than anyone on the are ready to open the doors to another 153,000 tend to be petty. Even though you will not International Relations Committee or in this foreigners who will take school places, train- join us to widen the scope of the fund we will Congress the dangers of complacency. Con- ing places and flats (apartments),’’ Haider not vote against the bill. We too want to said. He continued, ‘‘When Turkish children draw a line under a chapter we are also re- gressman LANTOS knows that remaining silent demand protection money from our children sponsible for.’’ when hate-mongers come to power is not an at the playground, it’s time to say, this is In May 1995, the Freedom Party was the option. And I thank him again for his leader- our state,’’ Haider declared. only major Austrian political party absent ship and his dedication. Haider has continued to wage a xenophobic from ceremonies at Mauthausen death camp Mr. Speaker, everyone in this Congress has campaign to expel foreign workers. In March marking the 50th anniversary of the libera- heard the comments made by Jorg Haider and 1997, Haider stated that he wants one third of tion of the camp. Just before the anniver- leaders of the Freedom Party. Comments all foreigners working in Austria to be sent sary, Haider had referred to Mauthausen as a praising Hitler's policies. Statements praising home over the next two years. ‘‘punishment camp,’’ implying that those in- the Waffen S.S. Assertions consistently blam- According to Haider, ‘‘We take the right terred there were criminals. ing problems in Austria, including low employ- stand at the right time to save Austria While addressing the reunion of Waffen-SS against the dangers coming from outside.’’ veterans, Haider declared that the reason ment, high taxes and the spread of disease on people opposed them was ‘‘simply that in immigrants. DEFENDING NAZI POLICY AND NAZIS Mr. Haider's views are clear and his inten- According to his critics, despite public dis- this world there are decent people who have character and who have stuck to their beliefs tions are known. And his attempt to apologize claimers and overtures, Haider has a public each time he makes an offensive statement record of defending the policies of Nazi Ger- through the strongest headwinds and who re- many and of justifying individual actions mained true to their convictions until has grown as tiresome to me as his hateful during those years. Haider has utilized ter- today.’’ Haider’s appearance at the ceremony statements. And although Mr. Haider has re- minology reminiscent of the Nazis, announc- was unknown until days before amateur vid- signed his position, his party, the Freedom ing, for example in October 1990 a ‘‘final so- eotape of the gathering was broadcast on Party, remains in a coalition government in lution to the farm question.’’ Upon his elec- German television in December 1995. Austria with the People's Party. This must not Following these revelations, Haider de- tion to the leadership of the Freedom Party, be accepted. fended his appearance at the event, saying: Haider rejected comparisons with the Ger- ‘‘The Waffen SS was a part of the That is why I have joined with Congressman man Nazi Party, saying ‘‘The Freedom Party Wehrmacht and hence it deserves all the LANTOS, Chairman GILMAN, Ranking Member is not the descendant of the National Social- honor and respect of the army in public life.’’ GEJDENSON, another survivor of the Nazi era, ist Party. If it were, we would have an abso- ‘‘Everything I said in that video was com- and a number of my colleagues in introducing lute majority.’’ H. Res. 429. The House International Rela- Indeed, Haider first gained international pletely acceptable.’’ ‘‘I participated in this attention in March 1986 during the con- event and I don’t see any reason not to. tions Committee has passed this Resolution troversy surrounding the return of Walter While I reject National Socialism, I cer- and it is appropriate and necessary that the Reder, an Austrian born former major in the tainly do not approve of the wholesale dis- U.S. Congress put itself on record as dis- Nazi SS, who was freed by Italy from a life paragement of the older war generation. I approving of such a Government. sentence he was serving for his role in the stand by this generation and I fight against Once again, I would like to thank Congress- mass killing of Italian civilians in 1944. For the way it is disparaged.’’ Haider claimed he did not know the Waffen SS had been brand- man LANTOS for his leadership on this press- Haider, the controversy was ridiculous, as ing issue, as well as Chairman GILMAN and Reder was ‘‘a soldier who had done his duty.’’ ed a criminal organization by the post-war Nuremberg war crimes tribunal, adding: ‘‘It Ranking Member GEJDENSON for their support. Dismissing Reder’s wartime activities, I urge my colleagues to support this impor- Haider stated: ‘‘If you are going to speak doesn’t interest me in the least.’’ In December 1995, after viewing the video tant Resolution. about war crimes, you should admit such which captured Haider addressing and min- Mr. WEXLER. Mr. Speaker, I yield crimes were committed by all sides.’’ gling with former SS officers, Austrian pub- Haider’s most infamous comment came back the balance of my time. lic prosecutors launched a criminal inves- during a July 1991 debate in the Carinthia Mr. BALLENGER. Mr. Speaker, I tigation into Haider’s comments and speech provincial parliament, when Haider, then yield back the balance of my time. on the basis of the law against reviving Na- governor, declared: ‘‘An orderly employment The SPEAKER pro tempore (Mr. zism. Following the investigation by the policy was carried out in the Third Reich, PEASE). The question is on the motion public prosecutor’s offices, the Austrian min- which the government in Vienna cannot offered by the gentleman from North istry of justice announced that it was to drop manage,’’ In face of a national and inter- Carolina (Mr. BALLENGER) that the the proceedings because of insufficient national uproar, Haider apologized for his re- grounds. House suspend the rules and agree to marks, but said ‘‘What I said was a state- During the parliamentary debate in July the resolution, H. Res. 429. ment of fact: that in the Third Reich a large 1998 on a proposed new law requiring appli- The question was taken; and (two- number of workplaces were created through cants for Austrian citizenship to prove thirds having voted in favor thereof) an intensive employment policy and unem- knowledge of German, Franz Larfer, an MP ployment was thereby eliminated.’’ Haider, the rules were suspended and the reso- of the Freedom Party, used the word of course, did not mention to particulars of lution was agreed to. Umvolkung. This term was used by the Nazis Nazi labor policy, including military build- A motion to reconsider was laid on to define the forced change of the ethnic up, slave labor, and concentration camps. the table. composition of a population by immigration Recently, Haider defended his 1991 state- f or compulsory transfer. This happened in ment, claiming he was referring to Nazi pol- Eastern Europe during the Nazi-period lead- icy between 1933 and 1936. GENERAL LEAVE ing consequently to the annihilation of the In May 1992, while the government was em- inhabitants. The term is comparable to the Mr. BALLENGER. Mr. Speaker, I ask broiled in a scandal involving a provincial expression ethnic cleansing. unanimous consent that all Members government’s decision to honor a gathering In reaction to the use of this expression, may have 5 legislative days within of Waffen SS veterans, Haider defended the members of the Austrian parliament booed which to revise and extend their re- decision. Haider instead accused the Interior and shouted and the session had to be inter- marks on H. Res. 429. Minister in Parliament of engaging in rupted. After Heinz Fischer, the president of ‘‘primitive attacks’’ on ‘‘respectable’’ war The SPEAKER pro tempore. Is there the Austrian parliament, explained to Larfer veterans, while turning a blind eye to immi- objection to the request of the gen- the meaning of the word, Larfer returned to grant perpetrated crime. tleman from North Carolina? the microphone apologizing for applying it. More recently, Haider spoke out against There was no objection. As the media reported extensively on this in- the Austrian government’s plans to com- f cident, Haider defended Laufer’s use of this pensate 30,000 Austrian victims of Nazi rule, term, and reiterated in a press conference including Jews, Communists and homo- MUTUAL FUND TAX AWARENESS the following day that his colleague was sexuals, claiming that Austrian victims of ACT OF 2000 right in using this expression, explaining the allies, such as civilians who fled Aus- that the government applying a liberal im- Mr. GILLMOR. Mr. Speaker, I move tria’s occupation by US, Soviet, French and migration policy allows for extensive ‘‘for- to suspend the rules and pass the bill British troops, should also be compensated. eign infiltration,’’ which subsequently leads (H.R. 1089) to require the Securities As he told an elderly Austrian audience in to Umvolkung. April 1995, ‘‘It is not fair if all the money and Exchange Commission to require from the tax coffers goes to Israel.’’ How- Mr. CROWLEY. Mr. Speaker, before I the improved disclosure of after-tax re- ever, when the Parliament voted in June to begin, I would first like to thank Congressman turns regarding mutual fund perform- set up a $50 million compensation fund, LANTOS for taking the lead on this important ance, and for other purposes, as amend- Haider voted in its favor. Still insisting on Resolution. ed.

VerDate 20-MAR-2000 01:15 Apr 04, 2000 Jkt 079060 PO 00000 Frm 00018 Fmt 4634 Sfmt 0634 E:\CR\FM\A03AP7.025 pfrm12 PsN: H03PT1 April 3, 2000 CONGRESSIONAL RECORD — HOUSE H1649 The Clerk read as follows: 80 million own stocks in individuals at 16.4 percent grows to $208,000, which H.R. 1089 companies, and many others own is represented by the yellow. However, Be it enacted by the Senate and House of Rep- shares in mutual funds. Those 80 mil- when one takes out the fees and ex- resentatives of the United States of America in lion shareholders represent half of penses, that shrinks to $128,000, rep- Congress assembled, America’s households. resented by the red. Finally, after SECTION 1. SHORT TITLE. More and more Americans are uti- taxes, the investor is left with only This Act may be cited as the ‘‘Mutual Fund lizing mutual funds because of the ease $75,000, represented by the blue. In Tax Awareness Act of 2000’’. of investing and for the diversification other words, over 20 years, the investor SEC. 2. FINDINGS. that they provide. Investors have done loses $133,000 of the $208,000 to costs and The Congress finds the following: well in recent years in most mutual to taxes. (1) Taxes can be the single biggest cost associ- funds. But there is a major category of Now, this bill does not in any way ated with mutual funds. The average stock fund critical information that investors tell the mutual fund what stocks to investor has lost up to 3 percentage points of re- have not had access to in the past and turn every year to taxes. buy. It does not limit in any way the (2) The average portfolio turnover rate for an generally do not have access to now. amount of trading a fund can do. All it actively managed (nonindex) fund has increased I originally introduced this legisla- says is that an investor should know from 30 percent 20 years ago to almost 90 percent tion 2 years ago to assure that inves- the after-tax return as well as the pre- today, and average capital gains distributions of tors could obtain access to that infor- tax return when making an invest- growth funds, per share, have more than dou- mation. I am happy that the Com- ment. This is the type of information a bled in the last 10 years. mittee on Commerce has by unanimous fund investor should have, but does not (3) If a fund’s performance is based mostly on vote recommended this bill for passage, now generally receive. It is very dif- short-term gains, investors can lose a significant and that is why H.R. 1089 is before the part of their return to taxes. ficult to make an intelligent invest- (4) Performance figures that mutual funds body today. ment decision without it. generally disclose to their shareholders are net Also, I want to thank the gentleman The bill provides an important pro- of fees and expenses, but not taxes, and there- from Ohio (Mr. OXLEY), the sub- tection for investors by making avail- fore do not represent the impact taxes have on committee chairman; the gentleman able critical information which was not an investor’s return. from Virginia (Mr. BLILEY), the full available before. It will also, I suspect, (5) This disclosure focuses on how much committee chairman; as well as the result in increased competition in the money investors made before taxes, and not on gentleman from Massachusetts (Mr. how much money investors actually got to keep. mutual fund industry. MARKEY), the ranking member, for (6) Improved disclosure of the effect of taxes Now, over the course of the 2 years on mutual fund performance would allow share- their support of this legislation. since I introduced this legislation, I holders to compare after-tax returns to raw per- The critical information that I am have worked with Securities and Ex- formance, and would permit the investors to de- talking about is the actual after-tax change Commission Chairman Arthur termine whether the fund manager tries to mini- return of various funds. Without that Levitt and the commission as well as mize tax consequences for shareholders. information, it is almost impossible for the mutual fund industry. I am encour- (7) While the mutual fund prospectus details investors to make a meaningful com- aged by the responsible efforts of the the average annual portfolio turnover rate, the parison of real returns between dif- prospectus may not expressly inform share- mutual fund industry to improve after- ferent funds. This bill provides for the tax disclosure. holders about the impact the portfolio turnover Securities and Exchange Commission rate has on total returns. I would like to commend both the in- to require all funds to make this infor- SEC. 3. IMPROVEMENTS IN DISCLOSURE RE- dustry and the SEC for the forward- mation available. All funds report their QUIREMENTS. looking approach that they have indi- pre-tax returns; however, very few Within 18 months after the date of enactment cated they will be taking toward this funds report their after-tax returns, of this Act, the Securities and Exchange Com- problem. mission shall revise regulations under the Secu- which can be dramatically lower. rities Act of 1933 and the Investment Company Because of the way different funds I urge the Members to join me in ap- Act of 1940 to require, consistent with the pro- operate, the tax consequences and the proving H.R. 1089. tection of investors and the public interest, im- real returns for an individual investor Mr. Speaker, I reserve the balance of proved disclosure in investment company can vary tremendously from fund to my time. prospectuses or annual reports of after-tax re- Mr. MARKEY. Mr. Speaker, I yield turns to investors. fund. Some funds have very little turn- over in the stocks they manage and, myself such time as I may consume. The SPEAKER pro tempore. Pursu- therefore, impose a relatively small Mr. Speaker, I would like to begin by ant to the rule, the gentleman from tax burden on their investors. Other complimenting the gentleman from Ohio (Mr. GILLMOR) and the gentleman funds trade frequently. Each trade im- Ohio (Mr. GILLMOR). He has been a real from Massachusetts (Mr. MARKEY) each poses some type of tax consequences on national leader, looking at this whole will control 20 minutes. the investor. area of how much information a mu- The Chair recognizes the gentleman Often, all of that frequent trading, tual fund investor should receive just from Ohio (Mr. GILLMOR). which is sometimes called churning, as a matter of course with regard to GENERAL LEAVE does not even result in a higher pre-tax their investment and how much of Mr. GILLMOR. Mr. Speaker, I ask return. Certainly it results in a lower what was managed by a mutual fund unanimous consent that all Members after-tax return. But that fact is sel- company over the preceding year had may have 5 legislative days within dom disclosed to a mutual fund inves- led to tax consequences for investors which to revise and extend their re- tors. across the country. The gentleman marks and insert extraneous material This chart shows the hypothetical from Ohio (Mr. GILLMOR) has been on the bill, H.R. 1089, as amended. mutual fund return over a 1-year, 5- pressing on this issue for several years. The SPEAKER pro tempore. Is there year, 10-year, 15-year and 20-year pe- Without question, today is a historic objection to the request of the gen- riod using the average mutual fund re- day because we are moving very close tleman from Ohio? turn over the past several years of 16.4 now with passage here today to this be- There was no objection. percent per year. First, the investor coming a national law. Mr. GILLMOR. Mr. Speaker, I yield never really sees that 16.4 percent. On I want to commend the gentleman myself such time as I may consume. average, 2.8 percent of that return goes from Michigan (Mr. DINGELL) on the One of the most important changes to mutual fund fees and expenses, Democratic side, along with the gen- in America in the last couple of dec- bringing the return down to 13.6 per- tleman from New York (Mr. TOWNS), ades has been the tremendous expan- cent. Then one has in the average fund ranking Democratic Member of the sion of direct ownership by individuals an additional 3 percent for the investor subcommittee, for their work on this of America’s businesses. that goes for taxes. Factoring that in, issue, along with the gentleman from More people than ever now have a di- the return drops to 10.6 percent. Virginia (Mr. BLILEY) for the majority rect stake in the profitability of Amer- Well, what does that mean in real and the gentleman from Ohio (Mr. ican companies. In fact, 80 million dollars? It means a lot. Over a 20-year OXLEY), who is the subcommittee Americans own stocks. Some of those period, an initial investment of $10,000 chair.

VerDate 20-MAR-2000 01:40 Apr 04, 2000 Jkt 079060 PO 00000 Frm 00019 Fmt 4634 Sfmt 0634 E:\CR\FM\K03AP7.038 pfrm12 PsN: H03PT1 H1650 CONGRESSIONAL RECORD — HOUSE April 3, 2000 This has been put together in a bipar- comprehensive understandings of how, Mr. Speaker, I reserve the balance of tisan manner towards the goal of en- in fact, each one of the mutual fund my time. suring that all Americans, whether companies are managing similar port- Mr. GILLMOR. Mr. Speaker, I yield they be Democrat or Republican or lib- folios. Because then the consumer can myself such time as I may consume to eral or conservative, have access to select the fund which is more judi- once again express my appreciation to their tax obligations as a result of ciously managing in order to avoid the gentleman from Massachusetts their mutual fund investment. that tax incident for investors. (Mr. MARKEY) for his stalwart support The bill that we are taking up today In pressing for better disclosure in of this legislation; as well as the gen- is one that the gentleman from Ohio this area, we recognize that disclosure tleman from Virginia (Mr. BLILEY); the (Mr. GILLMOR) and I introduced about regarding past tax performance, like gentleman from Ohio (Mr. OXLEY); and 11⁄2 years ago. It is something that oc- all historical data regarding a fund’s the ranking members, the gentleman curred to us as an area that really did past performance, does not have pre- from Michigan (Mr. DINGELL) and the need some redressing. cise predictive value. The past does not gentleman from New York (Mr. Now, the good news is that, since the give us any indication of what is going TOWNS). Mr. Speaker, I reserve the balance of gentleman from Ohio (Mr. GILLMOR) to happen in the future. However, we and I have introduced this legislation, do believe that such information is, my time. Mr. MARKEY. Mr. Speaker, I yield the Securities and Exchange Commis- nevertheless, important and useful to myself such time as I may consume to sion has now taken an interest; and each investor so that they can have an once again urge support of all Members they in fact are now in the process of idea of how a fund has been managed, and we believe that each prospectus for the Gillmor-Markey tax disclosure promulgating regulations in this area legislation. that are consistent with the objectives should have that information. Since there are so many mutual funds out Mr. Speaker, I have no further re- that the gentleman from Ohio (Mr. there with similar investment objec- quests for time, and I yield back the GILLMOR) and I had in introducing the tives, investors could evaluate key fac- balance of my time. legislation. That is the good news. The tors like overall performance, fees, and Mr. GILLMOR. Mr. Speaker, I yield legislation itself has prompted that tax efficiency in choosing a particular myself such time as I may consume to kind of a discussion at the Securities fund. once again urge passage of the bill. and Exchange Commission. So H.R. 1089 directs the SEC to issue Mr. BLILEY. Mr. Speaker, today the House The essence of the bill is that it re- rules within 1 year to provide mutual is considering H.R. 1089, the Mutual Fund Tax quires the Securities and Exchange fund investors with disclosures regard- Awareness Act of 2000. This legislation, intro- Commission to issue rules aimed at en- ing the tax-adjusted value of their mu- duced by my friend and colleague, Mr. suring that mutual fund investors re- tual funds. It does not mandate the GILLMOR of Ohio, will benefit mutual fund in- ceive disclosure regarding the after-tax specific form or the content of such vestors by providing them with better informa- performance of their fund. This type of disclosures. Instead, the Gillmor-Mar- tion about the performance of their funds. Presently, mutual fund companies list fund information, in combination with the key bill gives the commission the flexi- performance rates net of expenses and fees, other disclosures already required bility to develop rules which are con- with no consideration given to the taxes that under Federal laws, can be very useful sistent with the public interest and the fund investors must pay on a yearly basis. I to investors in making fully informed protection of investors following public believe it is important that investors be given investment decisions. notice and comment. Capital gains taxes have a material The SEC has submitted testimony on information about the effect of taxes on their effect upon the overall performance of the bill in which it has stated that the funds' performance. The Gillmor legislation would change a mutual fund. Information regarding Commission supports the goals of H.R. present law by requiring the S.E.C. to promul- the impact of such taxes is clearly ma- 1089. In fact, they have already issued gate new regulations to improve disclosure of terial information which every inves- draft disclosure rules which, again, tor in the United States should be enti- the effect of taxes on listed mutual fund rates seem to be consistent with the bill’s of return. By doing so, investors will be able tled to receive. objective. In adopting a final rule, the In 1998, these are big numbers, Mr. to shop around for a fund which best suits Commission should take into account their needs. Individuals with large yearly cap- Speaker. Mutual funds distributed ap- the views of investors, the mutual fund proximately $166 billion in capital ital losses can look for a fund with large cap- industry, and other commentators re- ital gains distributions, as a means of offset. gains and $134 billion in taxable divi- garding the precise form and content of Individuals who do not wish large capital gains dends. the new disclosure requirements, but it or ordinary income distributions will be able to So as we approach April 15th, as we should move forward quickly so that opt for a fund specifically managed for tax effi- approach tax day, mutual investors all by next year mutual fund investors ciency purposes. around the country become acutely have this type of disclosure at hand. Some may say, ``Why is this bill necessary aware of the importance which capital In conclusion, my colleagues, this is now?'' The S.E.C. is trying to accomplish the gains taxes have on their personal in- a good bill. It is noncontroversial. The same purpose as this bill. I believe this bill is vestments and on whether they will gentleman from Ohio (Mr. GILLMOR) necessary because we must ensure that these owe Uncle Sam any additional taxes and I, along with all the members of regulations go into effect on a date certain. based on the gains their investments the committee, have worked out this This legislation gives the S.E.C. 18 months to have made in the preceding year. Gillmor-Markey legislation in a way promulgate revised regulations. Mr. GILLMOR Indeed, we know today that the aver- that ensures that there is no con- has worked with the S.E.C. for years, asking age domestic equity mutual fund has troversy. And the reason there is no them to revise these regulations on their own, lost nearly 21⁄2 percentage points per controversy is that it is good for inves- without Congressional action. It was only after year to taxes on distribution of divi- tors, and it is good for our financial Mr. GILLMOR was stymied at the administrative dend and capital gains made to the markets. The more information which level that he pushed for enactment of this bill. fund shareholders. investors in our country are given ac- I know of no opposition to this legislation. In the last 5 years, it is estimated cess to, the more likely that we will Because it is so important to American inves- that investors in diversified U.S. stock have efficient and intelligent markets tors that they have a better idea about the ef- funds surrendered an average of 15 per- that are moving America’s investment fect of taxes on listed rates of performance in cent of their annual gains to taxes. Fif- dollars towards those funds, towards mutual funds, I urge an ``aye'' vote on this bill. teen percent of the annual gains for those companies which are going to re- Mr. OXLEY. Mr. Speaker, today I urge the mutual fund investors just went to sult in the highest degree of produc- House to pass H.R. 1089, the Mutual Fund taxes in the way in which the funds tivity for our society. Tax Awareness Act of 2000. were managed. So, again, I want to bow in recogni- In some form or another, 83 million Ameri- tion of the great leadership of the gen- cans, or one in every other household, are in- b 1515 tleman from Ohio and to the chairman vested in mutual funds. While many are in- Clearly, taxes are one of the most of the committee in moving this bill vested in tax deferred accounts, through pen- significant costs of mutual fund invest- forward through the legislative proc- sions, IRA's, or other retirement vehicles, mil- ment, and investors need to have clear, ess. lions are invested in taxable mutual funds.

VerDate 20-MAR-2000 02:39 Apr 04, 2000 Jkt 079060 PO 00000 Frm 00020 Fmt 4634 Sfmt 9920 E:\CR\FM\K03AP7.040 pfrm12 PsN: H03PT1 April 3, 2000 CONGRESSIONAL RECORD — HOUSE H1651 That is, on a yearly basis, these shareholders holder understanding of the impact taxes may SEC. 2. CONGRESSIONAL GOLD MEDAL. must pay ordinary income and capital gains have on fund performance. (a) PRESENTATION AUTHORIZED.—The Allowing the Securities and Exchange Com- Speaker of the House of Representatives and taxes on distributions they receive from their the President Pro Tempore of the Senate mutual funds. mission to revise regulations pertaining to the shall make appropriate arrangements for the Yet when present or prospective share- mutual fund industry will also inform investors presentation, on behalf of the Congress, of a holders review annual fund performance re- about the relative tax efficiencies of different gold medal of appropriate design to former sults in annual reports or prospectuses, the funds and how much of a fund's reported pre- President Ronald Reagan and his wife Nancy rates of return listed do not account for the im- tax return will be paid by an investor in taxes. Reagan in recognition of their service to the pact of taxes. This should not be the case. The Commerce Committee reported that taxes Nation. Given that the average fund loses almost (b) DESIGN AND STRIKING.—For the purpose cut mutual fund returns by an average of more of the presentation referred to in subsection three percentage points from their listed rates than 2.5 percentage points. This measure will (a), the Secretary of the Treasury (hereafter of return due to taxes, investors should be permit investors to determine whether mutual in this Act referred to as the ‘‘Secretary’’) presented with information about how much fund managers try to minimize tax con- shall strike a gold medal with suitable em- money they got to keep, not how much money sequences for shareholders. blems, devices, and inscriptions, to be deter- they received before paying the tax man. Only The transparency of American capital mar- mined by the Secretary. then will investors better be able to invest in kets is crucial to our continued prosperity. I SEC. 3. DUPLICATE MEDALS. mutual funds which best suit their needs. support efforts to enhance transparency and Under such regulations as the Secretary To respond to this problem our colleague, consumer protection. This is why I support the may prescribe, the Secretary may strike and sell duplicates in bronze of the gold medal Mr. GILLMOR, drafted this legislation before the Mutual Fund Awareness Act of 2000. struck pursuant to section 2 at a price suffi- House today. Among other things, this bill Mr. GILLMOR. Mr. Speaker, I have cient to cover the costs of the medals (in- would require the SEC to revise their regula- no further requests for time, and yield cluding labor, materials, dies, use of machin- tions to require that mutual fund companies back the balance of my time. ery, and overhead expenses) and the cost of list performance figures on an after-tax basis. The SPEAKER pro tempore (Mr. the gold medal. While it is impossible to predict precisely the PEASE). The question is on the motion SEC. 4. NATIONAL MEDALS. tax impact for every shareholderÐbecause offered by the gentleman from Ohio The medals struck under this Act are na- tional medals for purposes of chapter 51 of taxpayers are subject to differing federal and (Mr. GILLMOR) that the House suspend the rules and pass the bill, H.R. 1089, as title 31, United States Code. state tax rates due to their incomesÐthe infor- SEC. 5. FUNDING AND PROCEEDS OF SALE. mation to be presented is highly informative amended. (a) AUTHORIZATION.—There is hereby au- nonetheless. Such information will allow The question was taken. thorized to be charged against the United shareholders to determine which funds are Mr. GILLMOR. Mr. Speaker, on that States Mint Public Enterprise Fund an more tax efficient, enabling investors with tax I demand the yeas and nays. amount not to exceed $30,000 to pay for the concerns to opt for funds which best suit their The yeas and nays were ordered. cost of the medals authorized by this Act. tax needs. The SPEAKER pro tempore. Pursu- (b) PROCEEDS OF SALE.—Amounts received from the sale of duplicate bronze medals Federal securities law has always focused ant to clause 8 of rule XX and the Chair’s prior announcement, further under section 3 shall be deposited in the on disclosure, and that is the objective of this United States Mint Public Enterprise Fund. bill. By providing investors with better informa- proceedings on this motion will be postponed. The SPEAKER pro tempore. Pursu- tion about their funds, investors will be em- ant to the rule, the gentleman from powered. I know that Mr. GILLMOR has worked f Alabama (Mr. BACHUS) and the gen- with the SEC in developing this legislation, AWARDING GOLD MEDAL TO tleman from New York (Mr. LAFALCE) and that the SEC has responded on their own FORMER PRESIDENT AND MRS. each will control 20 minutes. by issuing a proposed regulations which aims RONALD REAGAN IN RECOGNI- The Chair recognizes the gentleman to do what the Gillmor bill does. It is important TION OF SERVICE TO NATION from Alabama (Mr. BACHUS). to pass the legislation before the House today Mr. BACHUS. Mr. Speaker, I move to The SPEAKER pro tempore. Pursu- to ensure that the final SEC rule is promul- ant to the rule, the gentleman from gated by a date certain. suspend the rules and pass the bill (H.R. 3591) to provide for the award of Alabama (Mr. BACHUS) and the gen- I know of no opposition to this bill, and I tleman from New York (Mr. LAFALCE) urge the support of the House. a gold medal on behalf of the Congress to former President Ronald Reagan and each will control 20 minutes. Ms. JACKSON-LEE of Texas. Mr. Speaker, The Chair recognizes the gentleman his wife Nancy Reagan in recognition I rise today in support of the Mutual Fund from Alabama (Mr. BACHUS). of their service to the Nation. Awareness Act of 2000. This Act will ensure Mr. BACHUS. Mr. Speaker, I yield The Clerk read as follows: that the mutual fund industry clearly discloses such time as he may consume to the H.R. 3591 the performance and costs to investors on all gentleman from Nevada (Mr. GIBBONS) funds. Improved methods of disclosing the Be it enacted by the Senate and House of who is the principal sponsor of the gold after-tax effects of portfolio turnover on invest- Representatives of the United States of America in Congress assembled, medal bill to honor President Ronald ment company returns to investors is a signifi- Reagan and Nancy Reagan. cant step in providing those who invest in our SECTION 1. FINDINGS. The Congress finds the following: (Mr. GIBBONS asked and was given capital markets with all the information needed (1) Both former President Ronald Reagan permission to revise and extend his re- to make prudent investment decisions. and his wife Nancy Reagan have distin- marks.) The Mutual Fund Tax Awareness Act would guished records of public service to the Mr. GIBBONS. Mr. Speaker, first I require the Securities and Exchange Commis- United States, the American people, and the would like to thank my colleague and sion to revise its regulations to improve meth- international community. friend, the chairman of the Sub- ods of disclosing to investors in mutual fund (2) As President, Ronald Reagan restored committee on Domestic and Inter- prospectuses and annual reports the after-tax ‘‘the great, confident roar of American national Monetary Policy of the Com- effects of portfolio turnover on mutual fund re- progress, growth, and optimism’’, a pledge mittee on Banking and Financial Serv- turns. While investment company disclosure which he made before elected to office. (3) President Ronald Reagan’s leadership ices for granting me this time to ad- regarding a fund's performance is conveyed was instrumental in uniting a divided world dress this bill. net of fees and expenses, often the tax effects by bringing about an end to the cold war. Mr. Speaker, in recognition of their of a portfolio's activity are usually not included (4) The United States enjoyed sustained distinguished record of service to the in released performance information. However, economic prosperity and employment United States, I introduced, along with the tax consequences of mutual fund portfolio growth during Ronald Reagan’s presidency. the gentlewoman from Washington turnover may significantly effect the overall (5) President Ronald Reagan’s wife Nancy (Ms. DUNN), H.R. 3591 to award a Con- performance of an investor's fund selection. not only served as a gracious First Lady but gressional Gold Medal to former Presi- During this age of often-volatile stock mar- also as a proponent for preventing alcohol dent Ronald Reagan and former First and drug use among the Nation’s youth by ket trading days, the portfolio turnover rate for championing the ‘‘Just Say No’’ campaign. Lady Nancy Reagan. actively managed funds have increased during (6) Together, Ronald and Nancy Reagan The Congressional Gold Medal is con- the 1990's, this activity has lead to an in- dedicated their lives to promoting national sidered the most distinguished form of crease in the average capital gains distribution pride and to bettering the quality of life in recognition that Congress has be- per share. This measure will enhance share- the United States and throughout the world. stowed. I wholeheartedly believe, as do

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