E PL UR UM IB N U U S Congressional Record United States th of America PROCEEDINGS AND DEBATES OF THE 104 CONGRESS, FIRST SESSION

Vol. 141 WASHINGTON, TUESDAY, JUNE 27, 1995 No. 106 House of Representatives

The House met at 10:30 a.m. and was Nevertheless, I have noticed a great does that 20-percent cut mean? First of called to order by the Speaker pro tem- deal of media discussion again compar- all, is it a 20-percent real cut? Did the pore [Mr. EMERSON]. ing the President’s new budget that he President mean that Federal agencies f talked about in his televised presen- will have 20 percent less budget or did tation to the Nation a couple of weeks he mean it will be a Washington cut, DESIGNATION OF SPEAKER PRO ago with the proposed united congres- there will be a 20 percent decrease in TEMPORE sional budget, and by united congres- the amount of new spending? I think The SPEAKER pro tempore laid be- sional budget, I mean the House-Senate that is a reasonable question, but there fore the House the following commu- conference report which is coming to is no answer to it. nication from the Speaker: us. Further, does that mean a 20-percent WASHINGTON, DC, Now, I have to say with the utmost cut across the board? That means, how- June 27, 1995. respect: ‘‘What new budget from the ever you define a cut, will every single I hereby designate the Honorable BILL EM- President of the United States?’’ agency except for the military and ex- ERSON to act as Speaker pro tempore on this Now, Mr. Speaker and colleagues, cept for the agency, have a 20 percent day. this is a budget. In fact, this is the reduced budget, or does it mean an av- NEWT GINGRICH, President’s budget submitted to the erage 20 percent reduction so that some Speaker of the House of Representatives. Congress in February of this year, agencies and some programs will, say, f which, as you can see by its size, goes remain the same and other agencies through each agency and each program MORNING BUSINESS and programs will be reduced by 40 per- and point by point proposes spending in cent? We do not know any of that ei- The SPEAKER. Pursuant to the the next fiscal year and beyond. There ther. order of the House of May 12, 1995, the is no such document from the White So, to give some specific examples, Chair will now recognize Members from House, at least as of this time, which we do not know what the congressional lists submitted by the majority and gives comparable point-by-point pro- proposal is being compared to. Let me minority leaders for morning hour de- posals for spending. give three examples very briefly. First bates. The Chair will alternate recogni- There is, if one contacts the White of all, to start with, my home State of tion between the parties, with each House, available some talking points New Mexico, there has been a great party limited to not to exceed 30 min- about the President’s new budget deal of discussion about how the future utes, and each Member except the ma- goals. But talking points are not by funding of the Federal Government will jority and minority leaders limited to themselves a budget. A budget is pro- affect the two national laboratories in not to exceed 5 minutes. gram-by-program recommendations on New Mexico and there has been a good The Chair recognizes the gentleman spending. deal of debate about what the congres- from New Mexico [Mr. SCHIFF] for 5 The fact of the matter is in most re- sional figures will mean in various pro- minutes. spects we do not know what is in the grams. I want to say that all of this is f President’s new budget and, therefore, fair commentary, that the national when the media compares the Presi- laboratories, I think, are important WHAT NEW BUDGET FROM THE dent’s budget with the congressional programs, but they understand, as ev- PRESIDENT? budget, they are comparing our real eryone understands, that they will be Mr. SCHIFF. Mr. Speaker, as our col- budget with the President’s talking affected as all Federal programs will, leagues are aware, the House and Sen- points, and, as such, there cannot be a in the goal to reach the balanced budg- ate budget committees reached a reso- point-by-point comparison. et. But the evaluation of how they are lution of the differences between the We do not know how the President’s being treated by Congress cannot be House budget resolution and the budg- new budget will affect so many pro- made in a vacuum. et resolution of the other body, and we grams that are federally funded. We How will all the national laboratories may get their conference report on the have a brief reference in the Presi- fare in the President’s new budget if future budget as soon as this week, and dent’s televised address to the Nation the President’s new budget is adopted I want to say that they have had to referring to a 20-percent cut in funding as the spending blueprint for the Con- make a number of hard choices, just as for discretionary programs except for gress? Well, we just do not know be- each body, the House and the other the military and except for education, cause we have not seen those figures. body, had to make hard choices within and the President stated he wanted to Nobody thus far can answer that ques- their own budget resolutions. boost spending on education. But what tion.

b This symbol represents the time of day during the House proceedings, e.g., b 1407 is 2:07 p.m. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor.

H 6313 H 6314 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Just this morning, just to show this Let me just share a couple of num- the same way that we use language in applies anywhere, as I was leaving my bers with you that may be helpful. the rest of the country, the public is apartment to come here, I saw one of Total spending for 1995 was $1.531 tril- going to continue to be confused about the national morning news programs. lion; that is, $1.531 trillion. The pro- this. They were centered around the na- jected spending for the year 2000, under Let us look at Medicare as an exam- tional park system, and one of the the Republican conference bill that was ple, because this is where you will hear comments I heard is they said we will just approved by the conference com- the greatest exploitation of these pro- be talking about how proposed congres- mittee, will be $1.778 trillion, that is, jected increases in terms of political sional cuts will affect the National $1.778 trillion. Let us go over those exploitation, and these numbers will be Park Service. again: used to inject fear into the debate, to I just wanted to say, to be a full play- In 1995, $1,531,000,000,000, in 2000, scare senior citizens and, frankly, to er, Mr. Speaker, the President has to $1,778,000,000,000: More than $350 billion confuse for political gain. The reality provide a full proposed budget. more will be spent in the year 2000 by is that in 1995 we are spending $178 bil- f the Federal Government under the Re- lion on Medicare. In the year 2000, publican plan that gets us to a bal- under the Republican budget plan, if COMPACT-IMPACT AID anced budget than was spent or is that is what is finally approved and The SPEAKER pro tempore. Under being spent right now in the fiscal year passed by both the Senate and the the Speaker’s announced policy of May 1995. House and then signed into law this 12, 1995, the gentleman from Guam [Mr. Now, let me put that in the context coming August or September by the UNDERWOOD] is recognized during of something that the President said President of the United States, we will morning business for 5 minutes. on the CBS This Morning program spend $214 billion, $178 billion in Medi- Mr. UNDERWOOD. Mr. Speaker, I about 2 years ago, May 27, 1993. He was care in 1995, $214 billion on Medicare in rise today to again call attention to being interviewed by Paula Zahn, and the year 2000. the problem of unrestricted immigra- he said in response to a question about Does that or does that not sound like tion to Guam allowed by the compact the budget he said, ‘‘We have about an increase? Clearly, it is an increase, of free association and the failure of $100 billion in cuts, but they are still and yet you will hear it described as a the Federal Government to fulfill its going up very rapidly.’’ I will say that cut. promises to Guam to reimburse our again: ‘‘We have about $100 billion in f local government for the cost of edu- cuts in various entitlement programs, cational and social services that this but they are still going up very rap- ELECTIONS IN HAITI immigration policy causes. idly.’’ Mr. SPEAKER pro tempore. Under This legal immigration allows the Now, what does that mean? Think the Speaker’s announced policy of May citizens of the three nations of the about those words. How can we have 12, 1995, the gentleman from Florida former trust territory to travel unre- $100 billion in cuts but they are still [Mr. GOSS] is recognized during morn- stricted to the United States, without going up very rapidly? That is the ing business for 5 minutes. passports or visas, and to reside, work, problem with Washington doublespeak. Mr. GOSS. Mr. Speaker, speaking of or attend school without going through We talk a lot about Orwellian lan- the budget as the previous colleagues the usual INS applications. In opening guage. We talk a lot about the problem have from this point of view, I think it the door to this unusual and generous that George Orwell so brilliantly is important to note that today the policy, the Federal Government also talked about and exposed there is his Members of this body will be discussing promised in Public Law 99–239 to reim- novel ‘‘1984,’’ and it is the problem of the appropriation for our foreign oper- burse the American islands in the Pa- the debasement of language, the abuse ations assistance, and that, of course, cific for the expected costs. Guam, be- of language and the use of language in is part of our budget process, how cause of its proximity, has received the a way that, in fact, confuses people in- much money are we going to parcel out greatest share of this immigration. stead of bringing clarity and light, and for the different things we undertake Since 1985, when the compact was en- that is the problem we have got with as the United States of America acted, and compact-impact aid was au- the budget, because the reality is that through the governance in Washington. thorized, Guam has incurred over $70 we talk about money inside Washing- Today I am here to talk a little bit million in costs. Guam has received a ton in a way that is very different from about a specific budget item and a lit- grand total of $2.5 million in reim- how we talk about it over kitchen ta- tle bit about a situation where Amer- bursement. bles in Cleveland, OH, or over cor- ican taxpayers’ dollars go in very sub- Mr. Speaker, Congress has spoken porate board tables in corporate board- stantial amounts, because I think out loud and clear on unfunded Federal rooms or the way that people in there is some interest in it. I think mandates. As we consider the Interior churches discuss their budget for the there should be some interest in it. appropriations bill this week, I urge next year or the way that people with I am reporting about the situation in my colleagues to ensure that the fund- nonprofit foundations and corporations Haiti today, discussing a little bit the ing for Guam’s reimbursement is in- and universities and institutions of question about foreign aid for Haiti, cluded. Let us make sure that on this that sort discuss their budget. The fact how much is right and how should we issue, promises are kept. is that we can talk about money in handle it. f Washington in terms of a projected As we go through the foreign oper- amount of growth that was created by ations appropriations bill, I will be sub- THE FEDERAL BUDGET a bureaucratic agency known as the mitting an amendment that will deal The SPEAKER pro tempore. Under Congressional Budget Office, and that directly with the subject, so in a way I the Speaker’s announced policy of May budget office, the CBO, talks about we am going to use these few moments 12, 1995, the gentleman from Ohio [Mr. are going to have this much growth just to say that I have come back from HOKE] is recognized during morning projected; therefore, if you project the elections in Haiti, and I think that business for 5 minutes. spending less than that, that is a cut, there is a very important message in Mr. HOKE. Mr. Speaker, I rise today and if you project spending the same as those elections, and I also feel that to talk about the Federal budget and that, then you have not spent more there is much work ahead and much to talk about the context in which it is money, but the reality is that in Cleve- accountability ahead. being discussed both by the President land, OH, if you are going to spend Let me be specific. The headline this and in the media and on the floor, and $5,000 on food and clothing in 1996 and morning in one of the Washington pa- I particularly want to thank my good you spent $4,700 on food and clothing pers was, ‘‘A step for Democracy?’’ friend, the gentleman from New Mexico for your family in 1995, that is a $300 or After reviewing showing pictures and who spoke before me in his remarks re- 6 or 7 percent increase in spending. It is reviewing the reports that are coming garding highlighting what the fun- not a cut. It cannot be a cut under any from Haiti, I would conclude, having damental problems are in the way that circumstances, and until and unless we been there for 4 days and gotten around we talk about the budget itself. begin to use language in Washington part of the country and been in charge June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6315 of a team that had observers spread remember what happened if they went and I urge all Americans to visit the countrywide, that it was a very small to vote in the past and they did not National Air and Space Museum here step, a very halting step, a very hesi- have that security. Bad things hap- in Washington and see this great trib- tant step for democracy, but it was a pened. ute to American aviation, American step. It was a very expensive step for Another good part of the news, of the veterans, and American history. the American taxpayers also. good news, is that the political parties f It turned out that by our standard, are beginning to work better in Haiti. you would probably not recognize it as The one thing that did work in these RECESS much of an election. It was a very com- elections was the poll watchers were The SPEAKER pro tempore. pressed election time, virtually no there and doing their job on behalf of Purusant to clause 12, rule I, the Chair campaign, which I think many Ameri- the parties, and I am happy to say that declares the House in recess until 12 cans would probably applaud, but un- after the election voting process is noon. fortunately that meant for Haitians pretty much over, that the parties are Accordingly (at 10 o’clock and 52 they did not know what the issues were the ones who are getting involved in minutes a.m.), the House stood in re- or what was going on, and in that coun- making the complaints and making cess until 12 noon. try, generally, you vote for an individ- things happen in Haiti, and that is the f ual out of a loyalty or a personal con- way it should be. The parties were viction, and the issues seem to take a doing a better job than the government b 1200 subordinate role. did of running, by and large. AFTER RECESS There were an extraordinary amount What is ahead? We have got about a of unaddressed administrative prob- quarter billion dollars in aid going to The recess having expired, the House lems, and when I say unaddressed, that Haiti. That means a lot of accountabil- was called to order by the Speaker pro is the critical word because the people ity. I think most Americans want to tempore (Mr. FOLEY) at 12 noon. in charge of the election apparently know what has been spent there, for f got the complaints but never gave any what purposes, what specifically, how PRAYER answers out. It created a tremendous much more are we going to spend. amount of frustration that led to a We have the Presidential elections The Chaplain, Rev. James David lack of transparency. The people did coming in December 1995, and that is Ford, D.D., offered the following pray- not know what was going on. The peo- the big one. That is the one that mat- er: ple making decisions were not sharing ters. I think we had better be better We admit, O gracious God, that often why they were making those decisions, prepared than we were for these par- we know the route we should follow and that, in turn, eroded credibility. liamentary elections. but we lack the will to take the step, we understand where we should be and Credibility is vital for full, free elec- f tions. what we should do, but we lack the res- It turned out not only was there no THE NEW ENOLA GAY EXHIBIT AT olution to follow through on our be- campaign to speak out, there was no THE SMITHSONIAN liefs. On this day we pray, O God, that, training in advance of poll workers, no The SPEAKER pro tempore. Under armed with Your good spirit, we will preparation of the people. As a result, the Speaker’s announced policy of May have the courage to act as well as to there was no great enthusiasm to go 12, 1995, the gentleman from Texas, Mr. think, to do as well as to talk, and fi- nally, to accomplish the works of faith out and vote and, in fact, the turnout SAM JOHNSON, during morning business was disappointingly light. It turned is recognized for 5 minutes. and hope and love in all we do. Bless us out when you went to vote, if you were Mr. SAM JOHNSON of Texas. Mr. this day and every day, we pray. Amen. a Haitian, there were missing can- Speaker, just a few short months ago, f didates. The candidate you wanted to the Smithsonian Institution was sur- THE JOURNAL vote for was not on the ballot or the rounded with controversy. The planned polling workers were not at the polling exhibit of the historic Enola Gay, the The SPEAKER pro tempore. The station to help you vote or to open the plane that actually dropped the atomic Chair has examined the Journal of the polling station, because they had not bomb on Japan, was overcome with his- last day’s proceedings and announces been paid, or there were no materials toric revisionism and distortion of fact to the House his approval thereof. to vote. You might have gotten to the by a group of people that was deter- Pursuant to clause 1, rule I, the Jour- right place and your candidate was on mined to editorialize and promote an nal stands approved. the ballot, but there was no other ma- anti-American message about the end f terial to deal with, say, no ballot of World War II, which we are celebrat- PLEDGE OF ALLEGIANCE boxes. We found these kinds of prob- ing this year, as you know. lems widespread everywhere. I am happy to report that starting The SPEAKER. Will the gentleman The end result is people were dissat- tomorrow, that exhibit is going to be from Georgia [Mr. BISHOP] come for- isfied. There was frustration, and as we open to the public, and Secretary ward and lead the House in the Pledge have all seen in the pictures from the Heyman and the Smithsonian have cre- of Allegiance. television and newspapers, widespread ated a new Enola Gay exhibit that Mr. BISHOP led the Pledge of Alle- disturbances, nothing like the violence every American can be proud of. The giance as follows: in past elections in Haiti. We are all new exhibit, which I had an oppor- I pledge allegiance to the Flag of the glad abut that. but, still, some very se- tunity to view last week, tells the United States of America, and to the Repub- rious incidents did take place in the lic for which it stands, one nation under God, amazing story of the development of indivisible, with liberty and justice for all. country, when you are burning down the B–29 airplane, and it talks about voting stations and stoning candidates, how America researched and how f as did happen in some places, and we do American industry and how American MESSAGE FROM THE SENATE not know all of these details yet. ingenuity developed our air power so A message from the Senate by Mr. We have got a problem. The mood that we actually were able to win Lundregan, one of its clerks, an- was clearly more relaxed than in the World War II, and it shows the brave nounced that the Senate had passed last election in 1990, when I was also crew that flew on a historic mission. concurrent resolutions of the following there as an observer, but there is still Most importantly, the exhibit shows titles, in which the concurrence of the concern about personal security, and the true role America played in ending House is requested: the light turnout was in part described World War II, in saving both American by some Haitians due to the fact they and Japanese lives. S. Con. Res. 18. Concurrent resolution au- thorizing the Architect of the Capitol to did not have enough security at the Mr. Speaker, I congratulate the transfer the catafalque to the Supreme Court polls. They wanted to see somebody Smithsonian. I think the National Air for a funeral service. out there who could protect them if and Space Museum is back on track as S. Con. Res. 19. Concurrent resolution to they want to vote, because they could an exemplary museum for America, correct the enrollment of the bill H.R. 483. H 6316 CONGRESSIONAL RECORD — HOUSE June 27, 1995 The message also announced that the your country, take care of America; WHY DOESN’T THE REPUBLICAN Senate agrees to the report of the com- that’s why you were elected.’’ PARTY ABIDE BY THE RULES? mittee of conference on the disagreeing He would also say, ‘‘Help the Amer- (Mr. VOLKMER asked and was given votes of the two Houses on the amend- ican people get jobs, and they won’t permission to address the House for 1 ment of the Senate to the bill (H.R. need that much government,’’ and he minute and to revise and extend his re- 483) ‘‘An act to amend title XVIII of would also say, ‘‘Pass H.R. 390 to marks.) the Social Security Act to permit Med- change the burden of proof in tax Mr. VOLKMER. Mr. Speaker, Mem- icare select policies to be offered in all cases.’’ bers of the House, I hold up this little States, and for other purposes.’’ My colleagues, I want to present on book, and I ask, ‘‘Why don’t the major- f his retirement, Gus Gustafson. Hear, ity abide by this book?’’ hear, Gus. My colleagues, one of the Mr. Speaker, this is a bible of the ANNOUNCEMENT BY THE SPEAKER great men of the United States Con- PRO TEMPORE House of Representatives. It is the gress. Rules of the House of Representatives. The SPEAKER pro tempore. The f Yet under section 10, subsection 62(a), Chair will entertain fifteen 1-minute it says no Member of this House may speeches on each side. ANNOUNCEMENT BY THE SPEAKER be a member of more than four sub- f PRO TEMPORE committees. That is a rule of the House THE RETIREMENT OF E.C. ‘‘GUS’’ The SPEAKER pro tempore. The of Representatives. GUSTAFSON, CHIEF REPORTER Chair wishes to thank the gentleman Mr. Speaker, that was changed by RAFICANT], and on be- OF OFFICIAL REPORTERS OF DE- from Ohio [Mr. T the majority of Republicans under half of the Speaker and the entire BATE Speaker GINGRICH back in January House of Representatives, the Chair when we used to be able to have five (Mr. TRAFICANT asked and was wishes to take this opportunity to subcommittees. He said, ‘‘No, only given permission to address the House thank our dear friend, E.C. ‘‘Gus’’ Gus- four.’’ Well, we now have 30, 30 mem- for 1 minute and to revise and extend tafson, for a very special service to the bers of the majority Republican Party, his remarks.) House. Gus’ retirement does represent who have more than four subcommit- Mr. TRAFICANT. Mr. Speaker, when the end of a great tradition of short- tees, some as many as six. the House adjourns this week, it will hand official reporting in the House. Mr. Speaker, I ask, ‘‘Why doesn’t the literally mark the end of an era. From His attention to detail, his patience, leadership of the Republican Party say the days of the Pharaohs, from the his mastery of proper parliamentary that they will abide by the rules of this days of Moses, to the time of King Ar- terms and references, and his willing- House? Why?’’ thur, to the founding of our great Con- ness to communicate his knowledge Because, Mr. Speaker, they make a stitution and the words of our Found- and experience to other official report- constant effort not to abide by the ing Fathers, all of the great spoken ers deserves special commendation at rules of the House. words were memorialized by hand, pen, this time. We all wish him well. quill, and ink. f f Not any more. Now this new high- AID TO RUSSIA technology stenotype machine, handled WHAT IS IT LIKE TO FIGHT FOR by lovely people such as Ms. Mazur and (Mr. HEFLEY asked and was given DEFICIT REDUCTION FROM permission to address the House for 1 others of the official Office of the Re- FIRST CLASS? porters of Debates, shall memorialize minute and to revise and extend his re- all the great debates that take place in (Mr. TIAHRT asked and was given marks.) the House, including that today on for- permission to address the House for 1 Mr. HEFLEY. Mr. Speaker, today the eign operations. minute and to revise and extend his re- House is going to debate the foreign op- But the reason why this great era is marks.) erations appropriation bill. During the ending, Mr. Speaker, is because a beau- Mr. TIAHRT. Mr. Speaker, we have debate on this bill I think we should tiful man, the chief of the Office of the been working hard in the House for work to spend this money wisely and Reporters of Debates, E. Charles Gus- months to eliminate four Cabinet de- responsibly. While the bill today is bet- tafson, known to us all as Gus, is fi- partments and balance the budget be- ter than in past years, many of us have nally retiring. cause we are serious about trimming been concerned about the spending My colleagues, this beautiful man the size of the Federal Government. We that has gone into foreign aid in the was born in 1921, on June 26, in West started with our own budget, cutting past, particularly aid directed at the Clarksville, NY. Gus then graduated committees, cutting committee staff, former Soviet Union. from the Gregg College of Court Re- and congressional mailings by a third. Mr. Speaker, we have given the porting in Chicago, IL, and began his But we also believe it is time for the former Soviet Union billions of dollars great career in the early 1940’s in near- Cabinet to step up to the plate, and in foreign aid and wonder how wisely by Cleveland, OH, to my hometown of there is not a better place to start than this has been spent. I am convinced Youngstown. Many of my colleagues the Department of Energy. that much of it has not been spent may not realize that when the war Mr. Speaker, at committee hearings wisely at all. That is because between broke out, World War II, Gus enlisted Energy Secretary O’Leary tells us that 50 and 90 percent of the money in these in the Navy and served his Nation she cannot find even one more dollar to aid packages has not reached the pock- aboard the battleship U.S. New Jersey cut in her department. She says she ets of one single pro-democracy, pro- and in the Philippines, and upon his wants to reform the Department of En- market, pro-reform Russian. discharge, Mr. Speaker, Gus resumed ergy. But in next year’s budget she Instead, much of the money has been his career in my hometown, Youngs- wants an additional $337 million and found in the pockets of consultants town, OH, and from 1946 to 1972 did tre- $360 million for travel. right here in the beltway, the ‘‘beltway mendously, establishing the foundation Well, the L.A. Times tells us the real bandits,’’ and much of the rest of it has of what would be called the ultimate story. Secretary O’Leary spends more just disappeared into the former Soviet for a reporter, to in fact be summoned on travel than any other member of Union without any real accounting of to Washington, DC. the Clinton Cabinet. She is flying first where it went or how it was being When the House adjourns this week, Class at taxpayers’ expense. She is spent. Too much of it has been given to my colleagues, Gus Gustafson will join staying in four-star hotels, luxury ho- consultants, too much of it has dis- his beautiful wife, Betsy, his two sons, tels. I guess she thinks it is proper for appeared, too little of it has gone to Charles and Richard, and his beautiful taxpayers to foot the bill for her Robin solid pro-democracy reformers in Rus- grandchildren, Ann and Alex, in that Leach lifestyle. sia. retirement. My question for the Secretary is: Therefore, my colleagues, let us look My colleagues, if Gus could speak on ‘‘What’s it like to fight for deficit re- at this Russian section of the foreign the floor, he would say: ‘‘Take care of duction from first class?’’ aid bill very carefully today. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6317 PROPOSED LEGISLATION WOULD what they call unfair Medicare cuts. great Nation. For generations, the GUARANTEE LONGER HOSPITAL Have they no shame? They want their American people built their lives STAYS ON CERTAIN VAGINAL Members to go to our senior citizens in around simple virtues: Thrift, hard DELIVERIES a nursing home, many of whom are on work, and personal responsibility. (Mr. MILLER of California asked and fixed incomes and dependent on Social Starting in the 1960’s, though, the was given permission to address the Security and their Medicare benefits, Federal Government began to reject House for 1 minute and to revise and and try to scare them into thinking these tried and true American virtues extend his remarks.) their benefits will be cut. Is this what in favor of a value system that placed Mr. MILLER of California. Mr. the once mighty Democrat Party has government at the center of any policy Speaker, having a baby is surely one of been reduced to? Are they completely consideration. the most wonderful and important bankrupt of ideas? The results have been phenomenally events for a family. Unfortunately, to We want to work together to increase disastrous. The Federal Government has racked maximize their profits, many insurance Medicare spending every year, for up the largest debt ever in the history companies treat this event as just an- every eligible person for 7 years. Is of mankind; a debt that will passed to other opportunity to cut costs. that a cut? No. We want to increase future generations. Many insurance companies cover Medicare spending by 33 percent over 7 Mr. Speaker, this week, Congress will only 1 night’s stay in the hospital after years. Mr. Speaker, it is time for partisan- vote to balance the budget in 7 years. a normal vaginal delivery. For some ship, gamesmanship, and scare tactics Not only will this budget return sanity women, this is enough time to recover to be set aside. We must work together to chaotic Federal spending, it will re- from the delivery and get adjusted to and solve the Medicare problems. turn our Government to the basic breast feeding and caring for the baby. American virtues of thrift, hard work, But for many other women, this is not f and personal responsiblity. enough time. REMOVING THE ROADBLOCKS TO f Doctors are increasingly alarmed A COLLEGE EDUCATION that babies are being discharged from (Mr. DOGGETT asked and was given CLOSING OF FORT MCCLELLAN hospitals within 24 hours. In that short permission to address the House for 1 SEEN AS A DANGEROUS MISTAKE time they cannot receive critical minute.) (Mr. BROWDER asked and was given health assessments to prevent routine Mr. DOGGETT. Mr. Speaker, I have permission to address the House for 1 child illnesses from becoming serious just this moment come from a meeting minute.) health problems. with many young Americans who are Mr. BROWDER. Mr. Speaker, I am Unfortunately, the decision to give deeply troubled about why the Repub- asking Alabamians and all Americans more extensive care to a newborn baby lican budget proposes the largest cut in concerned about chemical weapons and and the mother—such as monitoring Federal assistance to students who terrorism to write or call President for early signs of jaundice—is in the want to attend college of any time in Bill Clinton and urge him to save the hands of insurance companies, which our Nation’s history, and they are ask- world’s only live-agent chemical de- either limit stays or pressure doctors ing why, and one of the individuals who fense training base. to recommend short stays. is asking why down in my district is a The recommendation to close Fort Today I am introducing legislation woman named Tina Henderson, who I McClellan is a serious and dangerous with my colleague, PETER DEFAZIO, to had the opportunity and privilege to mistake. Closure of the only live-agent require insurance plans contracting meet a few weeks ago in Austin. chemical defense training facility will with the Federal Employee Health Ben- Tina Henderson is the first person in disrupt and degrade the ability of efits Program to cover a minimum stay her family to go to college. She did so America’s military forces to fight and in the hospital of 48 hours after a nor- after working as a member of the U.S. survive chemical warfare. mal vaginal delivery, and 96 hours after Air Force. She is a single mom. She Furthermore, with the threat of ter- a caesarean section. In the case of has a great daughter, a 5-year-old, rorism on the rise, this is no time to plans that offer at-home visits, this Erica, that she is mighty proud of, but deprive American civilians of the only minimum is waived as long as the plan she told me that without Federal stu- base that can respond to chemical at- provides extensive at-home, post- dent assistance she would not be able tack. partum visits. to go to college. Again, I am asking Alabamians and Mr. Speaker, let us start our babies Mr. Speaker, every family like hers all Americans concerned about chemi- off on the right foot. The health of the across America is being told in this cal weapons and terrorism to write or baby, not of insurance company port- budget, ‘‘Come up with an extra $5,000 call President Bill Clinton and urge folios, should be our No. 1 concern. I if you want to support a young person him to save the world’s only live-agent urge my colleagues to support this leg- through college in America in the fu- chemical defense training base. islation. ture.’’ With the tremendous cuts that f f are being made in this budget, road- blocks are being erected to Tina Hen- PROMISES MADE, PROMISES KEPT ENOUGH GAMESMANSHIP derson, to her daughter, Erica, and we IN NEW JERSEY (Mrs. SEASTRAND asked and was need to get those roadblocks out of the (Mr. ZIMMER asked and was given given permission to address the House way. permission to address the House for 1 for 1 minute and to revise and extend f minute and to revise and extend his re- her remarks.) marks.) Mrs. SEASTRAND. Mr. Speaker, as I THE LARGEST DEBT EVER IN THE Mr. ZIMMER. Mr. Speaker, I rise read the paper this morning, I could HISTORY OF MANKIND today to salute Governor Christie not believe what I read about what the (Mr. HOKE asked and was given per- Whitman and the legislature of the liberals are up to today. As we are mission to address the House for 1 State of New Jersey. reaching an agreement between the minute.) Yesterday, Mr. Speaker, the New Jer- House and the Senate regarding a bal- Mr. HOKE. Mr. Speaker, $3 per sey Legislature by overwhelming bipar- anced budget by the year 2002 by re- month over the 10-year period; that is tisan majorities voted to pass the third sponsibly slowing the rate of govern- the amount extra that students who and final phase of Christie Whitman’s ment spending increases, the other side take out student loans are being asked 30 percent income tax cut. of the aisle is planning another spate of to pay in response to the gentleman Two years ago, when Governor Whit- July fireworks. from Texas; $3 per month over 120 man and the Republican candidates for According to the Washington Times, months. the legislature promised that they the minority leadership is encouraging Mr. Speaker, for the last 30 years the would cut taxes in New Jersey by 30 their Members to go to a local nursing Federal Government has ignored the percent, a lot of people did not believe home and engage in scare tactics about simple virtues that made America a that they were going to do it, but they H 6318 CONGRESSIONAL RECORD — HOUSE June 27, 1995 kept their promise. They cut taxes, Mr. Speaker, the President may not sponsible for Republicans to steal $270 they cut spending, and they delivered know where he stands, but Republicans billion from Medicare to finance a tax for New Jersey families and for the have consistently stood for tax relief, giveaway to their wealthiest friends? New Jersey economy. No wonder Gov- smaller Government, and a balanced Seniors have every reason to be ernor Whitman has made New Jersey a budget. scared. Democrats support a balanced model for the other 49 States and for f budget, but we will not support a plan this Congress. that is antifamily and antielderly. We Promises made, promises kept. CONGRATULATIONS TO DETROIT will not support a plan that asks the Lower taxes, more jobs. The New Jer- RED WINGS AND 1995 STANLEY middle class working families to sac- sey message resonates throughout the CUP CHAMPIONS NEW JERSEY rifice not to balance the budget, but to Nation and should be remembered in DEVILS pay for a tax cut for the privileged few. this Chamber. (Mr. SMITH of Michigan asked and f f was given permission to address the House for 1 minute and to revise and CALIFORNIA TIMBER WORKERS STUDENTS PROTESTING PRO- extend his remarks.) WANT A HAND UP, NOT A HAND- POSED CUTS IN STUDENT LOANS Mr. SMITH of Michigan. Mr. Speak- OUT (Ms. LOFGREN asked and was given er, the National Hockey League play- (Mr. RIGGS asked and was given per- permission to address the House for 1 offs concluded last Saturday with the mission to address the House for 1 minute.) victory of the New Jersey Devils. I am minute and to revise and extend his re- Ms. LOFGREN. Mr. Speaker, today here today as a result of a friendly bet marks.) in the Capitol hundreds of students will with my colleague from New Jersey, Mr. RIGGS. Mr. Speaker, I might be visiting with each of us protesting BOB FRANKS. point out to the gentlewoman that the the proposed cuts in student loans. Unfortunately, my favorite team, the Republican family tax credit will com- Why? Because these cuts are like open- Detroit Red Wings, lost to the Devils pletely remove or eliminate the tax li- ing up with an assault weapon on the after a brilliant run in the playoffs, de- ability for 4.7 million working poor American people. feating Dallas and San Jose and Chi- families. As my colleagues know, 8,000 stu- cago. In the finals, New Jersey and De- Mr. Speaker, 3 weeks ago, Bill Clin- dents at San Jose State University in troit battled through four grueling ton told thousands of timber workers my district received help in education games, but the Devils prevailed. Due to they could not go back to work in pro- last year, and many of those students the excellent play of Devils skaters ductive highwage private sector jobs would not be able to go to college with- such as Claude Lemieux, Scott Ste- when he vetoed the timber salvage out the loans and grants and work stu- vens, goalie Martin Brodeur, and the amendment. This veto, his first, trig- dent programs that have been provided. other excellent skaters, they secured gered a protest back here in Washing- I was terribly shocked to read in the Lord Stanley’s Cup. ton, DC, by mill workers and loggers paper the other day the supposition I wish to commend both teams in ad- and their family members in a stormy that somehow this is class warfare, vancing in the playoffs and further to headlined loggers protest in the Dis- that the high school graduates of the the NHL finals. trict of Columbia. country should not be asked to use In closing, consistent with our bet, I Today, the President is announcing their tax money for students to get show my tail, I show my horns, and I extra unemployment grants and some ahead and become college graduates show my fork, and I would like to loans for our area, northwest Califor- and even more. present this to BOB FRANKS, the Stan- nia. Well, we are glad that the adminis- ley Cup winners, the New Jersey Dev- tration has not forgotten about us b 1220 ils. completely, but do not insult the hard I think the person who said that does f working people in northern California not understand blue collar America. I with your charity at taxpayer expense, grew up the daughter of a truck driver ANNOUNCEMENT BY THE SPEAKER when you personally vetoed the bill and secretary, and I will tell you the PRO TEMPORE that would have put thousands of Cali- thing that mattered most to my par- The SPEAKER pro tempore (Mr. fornia loggers back to work. ents and every adult on the block, none FOLEY). The Chair would rule that the The fact that he would provide us of whom had college degrees, was that gentleman should not wear those mate- welfare style assistance, but will not all the kids get ahead and be success- rials on the floor. let loggers go back to work, tells us a ful. Do not cut down on the American f lot with the President. There is just dream. Allow students who work hard one problem: California timber workers to get good grades to get ahead. DO NOT SUPPORT A BALANCED want a hand up, not a handout. f BUDGET THAT IS ANTIFAMILY f AND ANTIELDERLY TAX RELIEF (Ms. DELAURO asked and was given GIVE YOUTH OF AMERICA THE (Mr. JONES asked and was given per- permission to address the House for 1 FUTURE THEY DESERVE mission to address the House for 1 minute and to revise and extend her re- (Mr. HILLIARD asked and was given minute and to revise and extend his re- marks.) permission to address the House for 1 marks.) Ms. DELAURO. Mr. Speaker, tonight minute and to revise and extend his re- Mr. JONES. Mr. Speaker, when Presi- the Republicans will release the details marks.) dent Clinton was running for the Presi- of their budget, setting the stage for Mr. HILLIARD. Mr. Speaker, I rise dency, a tax cut was one of the main national debate on budget priorities. today to recognize the students who features of his campaign. But when the The top priority of their budget is a are visiting our Capital City. These President was elected, he raised taxes $245 billion tax cut to the wealthy, bet- students have brought a message to on the middle class. Where does the ter known as the crown jewel. Yet the Congress, stressing the importance of President stand now? Who knows. Republican leadership will tell the funding the student loan programs. If Mr. Speaker, in the absence of lead- American people that this plan is fis- the Republicans cut or eliminate stu- ership from the White House, Repub- cally responsible. dent aid, many bright young people licans have introduced a tax relief plan Fiscally responsible? Where is the re- will not be able to go to college. that allows working Americans to keep sponsibility to working families? Is it I have seen the wonderful results of more of the money they earn. We have responsible for Republicans to cut $11 education funding. I have hosted sev- not flip-flopped or changed our posi- billion from student loans for the mid- eral financial-aid recipients as interns tion. Instead, we stand with the vast dle class to help to pay for a tax break in my congressional office. Currently, I majority of Americans who know all to the wealthy? am proud to have Vernetta, from too well the impacts of higher taxes Fiscally responsible? Where is the re- Selma, AL. Without the benefits of the and who struggle to make ends meet. sponsibility to our seniors? Is it re- student aid program, Vernetta would June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6319 not be able to complete her college moms, only to increase the profits of There was no objection. education. the insurance companies and these for- The Clerk read the Senate concur- Each of my interns has demonstrated profit managed health care plans. rent resolution, as follows: great intelligence and drive, and I feel Today the gentleman from California S. CON. RES. 18 very fortunate to have benefited from [Mr. MILLER] and I have introduced leg- Resolved by the Senate (the House of Rep- their talent and enthusiasm. Let us not islation to restrict this growing threat resentatives concurring), That the Architect of deprive this country of these bright to the public health and to our most the Capitol is authorized and directed to minds by denying them the oppor- vulnerable newborns and their moth- transfer to the custody of the Chief Justice tunity for an education. Let us give the ers. I urge my colleagues to join us in of the United States the catafalque which is youth of America the future they de- presently situated in the crypt beneath the stopping this outrageous practice. rotunda of the Capitol so that the said cata- serve. f falque may be used in the Supreme Court f Building in connection with services to be ANNOUNCEMENT BY THE SPEAKER conducted there for the late Honorable War- MEDICARE CUTS WILL BE PRO TEMPORE ren Burger, former Chief Justice of the Su- DEVASTATING The SPEAKER pro tempore. Spec- preme Court of the United States. (Mr. KLINK asked and was given per- tators in the gallery will refrain from The Senate concurrent resolution mission to address the House for 1 displaying approval or disapproval for was concurred in. minute and to revise and extend his re- Members’ remarks. A motion to reconsider was laid on marks.) the table. f Mr. KLINK. Mr. Speaker, I have f stood in this well before and I have de- TROUBLES IN CALIFORNIA NEED PERMISSION FOR SUNDRY COM- fended the policies of my leadership, TO BE ADDRESSED and I have also taken them on in some MITTEES AND THEIR SUB- instances. So I think that I have got (Mr. TUCKER asked and was given COMMITTEES TO SIT TODAY some credibility that I do not nec- permission to address the House for 1 DURING 5-MINUTE RULE minute and to revise and extend his re- essarily go along party lines with every Mr. BOEHNER. Mr. Speaker, I ask marks.) issue. But when it comes to Medicare unanimous consent that the following Mr. TUCKER. Mr. Speaker, I take cuts, the Democrats are completely committees and their subcommittees the well this morning to stand and be correct and the Republicans are com- be permitted to sit today while the counted. I take the well this morning pletely wrong. I tell you this after House is meeting in the Committee of to ask the President of the United going throughout the Fourth Congres- the Whole House under the 5-minute States to also stand and be counted. sional District of Pennsylvania and rule. talking to Republican doctors and Re- For in my great State of California, we Committee on Banking and Financial publican hospital administrators who have troubles. Services; Committee on Commerce; say, ‘‘Congressman, we are going to Mr. Speaker, it was 2 years ago when Committee on Economic and Edu- lose 1,000 health care jobs in your dis- I came to this House on the wings of cational Opportunities; Committee on trict if the Republican plan goes riots and destruction, fires and earth- Government Reform and Oversight; through to cut Medicare this deeply.’’ quakes. Since then, we have had all Committee on International Relations; You see, in my district, 1 in 5 resi- kind of layoffs and cutbacks in aero- Committee on Resources; Committee dents are on Medicare. Many of those space. on Science; Committee on Transpor- on Medicare are elderly and poor, and But now, Mr. Speaker, the most dev- tation and Infrastructure; and Perma- are also on Medicaid. They cannot af- astating thing that has happened is the nent Select Committee on Intelligence. ford these kind of cuts. And is it a cut Base Closure Commission has said that It is my understanding that the mi- or isn’t it a cut? When you get less and the Long Beach Shipyard and McClel- nority has been consulted and that pay more for it, it is a cut. And when lan Air Base and other bases in Califor- there is no objection to these requests. you take a look at the dollars, and you nia must bear additional burdens of The SPEAKER pro tempore. Is there know those dollars are equal to the other additional layoffs. objection to the request of the gen- amount of dollars that we are giving Mr. Speaker, in my area of Long tleman from Ohio? wealthy people, those who make over Beach, 3,000 additional jobs are going There was no objection. $200,000, in tax cuts, then you know it to be lost. It is time for the President f is a direct offset we are taking from of the United States to stand up and the elderly poor to give to the rich. make good on the promise that he APPOINTMENT AS MEMBERS OF made to the people in California. We BOARD OF VISITORS TO U.S. AIR f cannot lose 3,000 more jobs in Long FORCE ACADEMY EARLY DISCHARGE OF NEWBORNS Beach and 2,000 more jobs in Los Ange- The SPEAKER pro tempore. Without AND MOTHERS A THREAT TO les County. The Rams have left, the objection, and pursuant to the provi- HEALTH Raiders are leaving. We have problems sions of section 9355(a) of title 10, Unit- (Mr. DEFAZIO asked and was given in California, and we need the Presi- ed States Code, the Chair announces permission to address the House for 1 dent of the United States to stand up the Speaker’s appointment as members minute and to revise and extend his re- and be counted. of the Board of Visitors to the U.S. Air marks.) f Force Academy the following Members Mr. DEFAZIO. Mr. Speaker, we have of the House: Mr. YOUNG of Florida, Mr. AUTHORIZING TRANSFER OF THE all heard about drive-by-shootings. HEFLEY of Colorado, Mr. DICKS of CATAFALQUE TO THE SUPREME How about drive-through deliveries? Washington, and Mr. TANNER of Ten- This latest threat to the health of COURT nessee. newborns and their moms comes from Mr. BOEHNER. Mr. Speaker, I ask There was no objection. insurance companies and managed unanimous consent to take from the f health programs. They are requiring Speaker’s table the Senate concurrent physicians and hospitals to put moth- resolution (S. Con. Res. 18) authorizing EXTENSION OF HEALTH CARE TO ers and newborns out of the hospital in the Architect of the Capitol to transfer VETERANS EXPOSED TO AGENT as little as 12 hours. Not to meet the the catafalque to the Supreme Court ORANGE wishes of the new mother, not to foster for a funeral service, and ask for its Mr. STUMP. Mr. Speaker, I move to the health of the newborns, not be- immediate consideration in the House. suspend the rules and pass the bill cause it is best in the professional med- The Clerk read the title of the Senate (H.R. 1565) to amend title 38, United ical opinion of the attending physi- concurrent resolution. States Code, to extend through Decem- cians. These arbitrary limits have been The SPEAKER pro tempore. Is there ber 31, 1997, the period during which the imposed, possibly jeopardizing the objection to the request of the gen- Secretary of Veterans Affairs is au- health of the newborns and their new tleman from Ohio? thorized to provide priority health care H 6320 CONGRESSIONAL RECORD — HOUSE June 27, 1995 to certain veterans exposed to agent ‘‘(C) The term ‘radiation-exposed veteran’ certain conditions have no association orange, ionizing radiation, or environ- has the meaning given that term in section with exposure, H.R. 1565 does not ex- mental hazards, as amended. 1112(c)(4) of this title.’’. tend authority for future health care. The Clerk read as follows: (b) AUTHORIZED OUTPATIENT CARE.—Sec- However, those veterans previously tion 1712 of such title is amended— H.R. 1565 (1) in subsection (a)(1)— or currently receiving care would be Be it enacted by the Senate and House of Rep- (A) by striking out ‘‘and’’ at the end of grandfathered for treatment under the resentatives of the United States of America in subparagraph (C); bill. Congress assembled, (B) by striking out the period at the end of I want to thank my good friend from SECTION 1. AUTHORITY OF PROVIDE PRIORITY subparagraph (D) and inserting in lieu there- Mississippi, SONNY MONTGOMERY, the HEALTH CARE. of a semicolon; distinguished ranking member of the (a) AUTHORIZED INPATIENT CARE.—Section (C) by adding at the end the following new committee for his assistance on this 1710(e) of title 38, United States Code, is subparagraphs: measure. amended— ‘‘(E) during the period before January 1, (1) in paragraph (1), by striking out sub- 1998, to any herbicide-exposed veteran (as de- Before yielding to him, I also want to paragraphs (A) and (B) and inserting in lieu fined in section 1710(e)(4)(A) of this title) for express my appreciation to TIM HUTCH- thereof the following: any disease specified in section 1710(e)(1)(A) INSON, chairman of the Subcommittee ‘‘(e)(1)(A) A herbicide-exposed veteran is of this title; and on Hospitals and Health Care, as well eligible for hospital care and nursing home ‘‘(F) to any radiation-exposed veteran (as as CHET EDWARDS, the subcommittee’s care under subsection (a)(1)(G) for any dis- defined in section 1112(c)(4) of this title) for ranking member for their work on the ease suffered by the veteran that is— I21‘‘(i) any disease covered under section bill. among those diseases for which the National 1710(e)(1)(B) of this title.’’; and They have maintained the commit- Academy of Sciences, in a report issued in (2) in subsection (i)(3)— accordance with section 2 of the Agent Or- (A) by striking out ‘‘(A)’’; and tee’s bipartisan approach to matters ange Act of 1991, has determined— (B) by striking out ‘‘, or (B)’’ and all that affecting veterans. ‘‘(I) that there is sufficient evidence to follows through ‘‘title’’. Concerns were raised at the sub- conclude that there is a positive association SEC. 2. SAVINGS PROVISION. committee markup about some provi- between occurrence of the disease in humans The provisions of sections 1710(e) and sions by Mr. FOX, who had drafted an and exposure to a herbicide agent; 1712(a) of title 38, United States Code, as in amendment, as well as Mr. GUTIERREZ ‘‘(II) that there is evidence which is sug- effect on the day before the date of the en- and Mr. KENNEDY. gestive of an association between occurrence actment of this Act, shall continue to apply Mr. EVANS also raised some concern. of the disease in humans and exposure to a on and after such date with respect to the I believe Mr. HUTCHINSON and Mr. ED- herbicide agent, but such evidence is limited furnishing of hospital care, nursing home WARDS responded very well to those in nature; or care, and medical services for any veteran ‘‘(III) that available studies are insuffi- who was furnished such care or services be- concerns and have done an excellent cient to permit a conclusion about the pres- fore such date of enactment on the basis of job working with other members on the ence or absence of an association between oc- presumed exposure to a substance or radi- bill. currence of the disease in humans and expo- ation under the authority of those provi- The cooperation of all Members on sure to a herbicide agent; or sions, but only for treatment for a disability these matters is greatly appreciated, ‘‘(ii) a disease for which the Secretary, pur- for which such care or services were fur- and I urge my colleagues to support suant to a recommendation of the Under nished before such date. Secretary for Health on the basis of a peer- the bill. reviewed research study or studies published The SPEAKER pro tempore. Pursu- Mr. Speaker, I yield such time as he within 20 months after the most recent re- ant to the rule, the gentleman from Ar- may consume to the gentleman from port of the National Academy under section izona [Mr. STUMP] will be recognized Arkansas [Mr. HUTCHINSON], chairman 2 of the Agent Orange Act of 1991, determines for 20 minutes, and the gentleman from of our Subcommittee on Hospitals and there is credible evidence suggestive of an Mississippi [Mr. MONTGOMERY] will be Health Care. association between occurrence of the dis- recognized for 20 minutes. Mr. HUTCHINSON. Mr. Speaker, I ease in humans and exposure to a herbicide The Chair recognizes the gentleman urge my colleagues to support H.R. agent. from Arizona [Mr. STUMP]. ‘‘(B) A radiation-exposed veteran is eligible 1565, bipartisan legislation to extend for hospital care and nursing home care (Mr. STUMP asked and was given the priority health care program for under subsection (a)(1)(G) for any disease permission to revise and extend his re- veterans exposed to agent orange and suffered by the veteran that is— marks.) ionizing radiation through December ‘‘(i) a disease listed in section 1112(c)(2) of GENERAL LEAVE 31, 1997. this title; or Mr. STUMP. Mr. Speaker, I ask I would like to thank Chairman ‘‘(ii) any other disease for which the Sec- unanimous consent that all Members STUMP, along with full committee retary, based on the advice of the Advisory ranking member MONTGOMERY and my Committee on Environmental Hazards, de- may have 5 legislative days within termines that there is credible evidence of a which to revise and extend their re- subcommittee colleague, ranking mem- positive association between occurrence of marks on H.R. 1565. ber CHET EDWARDS, for their tireless ef- the disease in humans and exposure to ioniz- The SPEAKER pro tempore. Is there forts to ensure that this bill receives ing radiation.’’; objection to the request of the gen- full consideration in an expeditious (2) in paragraph (2)— tleman from Arizona? fashion. (A) by striking out ‘‘Hospital’’ and insert- There was no objection. Furthermore, I wish to recognize ing in lieu thereof ‘‘In the case of a veteran Mr. STUMP. Mr. Speaker, I yield my- LANE EVANS, JOE KENNEDY, LUIS described in paragraph (1)(C), hospital’’; and (B) by striking out ‘‘subparagraph’’ and all self such time as I may consume. GUTIERREZ, and JON FOX for their bi- that follows through ‘‘subsection’’ and in- Mr. Speaker, first of all, I want to partisan work in fashioning com- serting in lieu thereof ‘‘paragraph (1)(C)’’; thank the leadership for allowing us to promise language when concerns were (3) in paragraph (3), by striking out ‘‘of bring H.R. 1565 to the floor as it ex- raised about the bill at the subcommit- this section after June 30, 1995,’’ and insert- tends authority which expires at the tee level. Without the work of these ing in lieu thereof ‘‘, in the case of care for end of this month. veterans’ advocates, this bill might a veteran described in paragraph (1)(A), after Mr. Speaker, H.R. 1565, extends VA’s have never come to the floor. December 31, 1997,’’; and Mr. Speaker, H.R. 1565 would incor- (4) by adding at the end the following new authority to provide health care to vet- paragraph: erans exposed to agent orange. porate for a 2-year extension period the ‘‘(4) For purposes of this subsection and It also makes permanent VA’s au- findings of the National Academy of section 1712 of this title: thority to provide health care to veter- Sciences, which provide rational sci- ‘‘(A) The term ‘herbicide-exposed veteran’ ans exposed to ionizing radiation. entific evidence on which determina- means a veteran (i) who served on active The provisions incorporate the find- tions of eligibility for health care can duty in the Republic of Vietnam during the ings of the National Academy of be based. The bill is supportive of vet- Vietnam era, and (ii) who the Secretary finds Sciences while still giving the benefit erans and continues to give them every may have been exposed during such service to a herbicide agent. of the doubt to veterans already being benefit of the doubt. It would authorize ‘‘(B) The term ‘herbicide agent’ has the treated. the VA to provide treatment for three meaning given that term in section 1116(a)(4) Where the National Academy of broad categories of conditions identi- of this title. Sciences has found evidence suggesting fied by the NAS and would grandfather June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6321 for continued care those veterans who The bill comes at a time when the Mr. SMITH of New Jersey. Mr. have been previously treated at the VA VA health care system is undergoing Speaker, I rise in strong support of but for which the NAS has found no as- very significant changes. At many VA H.R. 1565, legislation to extend the pri- sociation to exist between certain dis- facilities throughout the country, ef- ority health care program for veterans eases and exposure to herbicides. forts are under way to treat more vet- who were exposed to agent orange or Additionally, the bill would provide erans on an outpatient basis rather ionizing radiation. special eligibility in the case of radi- than putting them in the hospitals. As vice chair of the Committee on ation-exposed veterans for care of a That saves a lot of money. That is a Veterans’ Affairs, I would look to rec- long list of cancers as well as for any big change. ognize the gentleman from Arkansas disease for which the VA determines There is an emphasis on making VA [Mr. HUTCHINSON] and the gentleman there is credible evidence of a positive services more convenient and deliver- from Arizona [Mr. STUMP] for their association between disease occurrence ing them in a more cost-effective man- unyielding dedication to these veterans and radiation exposure. This bill also ner, and to do that on outpatient clin- who have suffered a wide range of ill- contains a generous grandfather clause ics. The new Under Secretary for nesses because of their service to their for those veterans who have previously Health, Dr. Kenneth Kizer, is moving country. been treated at the VA for which no the VA system into the 21st century. Mr. Speaker, as you know, H.R. 1565 positive association between the dis- His leadership and vision for the state- would take into consideration the find- ease occurrence and radiation exposure of-the-art health care for veterans have ings of the National Academy of has been found. Under this bill both turned the VA toward a goal of making Sciences, which has done extensive and groups of veterans would receive sub- all VA health care the first choice for exhaustive studies on agent orange stantially expanded outpatient services the service-connected and low-income linkage. This legislation would author- on a priority basis. veterans. His understanding of what ize the VA to continue priority health Mr. Speaker, this legislation also VA needs to do is very, very encourag- care treatment for the first three cat- takes into consideration the possibility ing. But there are some problems, Mr. egories identified by NAS. Addition- of a lag time between NAS reports and Speaker, that will be facing Dr. Kizer. ally, it would grandfather those veter- the discovery of new credible evidence Dr. Kizer does not have some of the ans who have been previously treated on agent orange. It would provide a basic tools he needs to make the VA by the VA for illnesses which now the mechanism to add additional diseases health care system more efficient. One NAS finds evidence of no linkage to based on new research findings. of the things he needs most from the agent orange exposure. So they are H.R. 1565 would authorize the Sec- Congress is a modest capital invest- protected and they are grandfathered. retary, based on recommendations of ment so that the VA can shift from This bipartisan bill—and the minor- the Under Secretary for Health, to add that is still a hospital-based system to ity side has been very, very helpful and to the list of covered conditions. A dis- provide more outpatient care. very strong in their views which has ease could be added based on peer-re- We have had these great 171 veterans helped to craft this important bill— viewed research published within 20 hospitals, but we are trying to move also takes into account the fact that months of the most recent NAS report into more outpatient clinic care. That NAS is not the only reputable sci- regarding agent orange. The addition is what the General Accounting Office entific agency doing research on this of new diseases must meet the test of has recommended. Such an investment matter. providing credible evidence suggestive will make VA care more convenient An amendment offered by Chairman of an association between that disease and cost-effective, moving toward more HUTCHINSON and supported by the en- and exposure to agent orange. outpatient clinic care. tire committee allows the Secretary of Mr. Speaker, H.R. 1565 enjoys unani- I am advised that the VA currently Veterans Affairs to add diseases to the mous support from the Veterans’ Af- has over $940 million in planned list of covered conditions based on peer fairs Committee. The bill passed at projects to improve outpatient facili- reviewed research which provides cred- markup 29 to 0. ties. If these projects are delayed and ible evidence of association between Again, I would like to thank my col- are not a priority in the appropriations that disease and agent orange expo- leagues on both sides of the aisle for process, the VA will be unable to be- sure. their support and assistance in writing come the efficient health care system Once more, Mr. Speaker, I strongly this legislation, and I urge Members to veterans expect and deserve. support this legislation. I urge my col- support the bill. Finally, Mr. Speaker, it has been well leagues to give it unanimous support. explained by the chairman of the sub- Mr. MONTGOMERY. Mr. Speaker, I b 1240 committee, it is appropriate that the yield 2 minutes to the gentleman from Mr. MONTGOMERY. Mr. Speaker, I first veterans bill taken up by the Texas [Mr. EDWARDS], the ranking yield myself such time as I may House in the 104th Congress deals with member of the Subcommittee on Hos- consume. health care problems of veterans ex- pitals and Health Care. I rise in strong support of this meas- posed to agent orange and ionizing ra- Mr. EDWARDS. Mr. Speaker, I want ure and commend the chairman of the diation. The Congress originally au- to rise in support of H.R. 1565, as committee, the gentleman from Ari- thorized health care services for these amended. I want to pay my respects to zona [Mr. STUMP], for bringing the veterans in 1981, when we had little the gentleman from Arkansas [Mr. measure to the floor; also to the gen- knowledge about the long-term effects HUTCHINSON] for his fine work on this. tleman from Arkansas [Mr. HUTCHIN- of the exposure of these agents. Over I want to express a personal thanks to SON], the chairman of the subcommit- time, as a result of objective scientific the gentleman from Arizona [Mr. tee, for his quick action as well as the review, the Congress and the executive STUMP] and to the gentleman from Mis- gentleman from Texas [Mr. EDWARDS] branch have tried to treat and com- sissippi [Mr. MONTGOMERY] for the way on the minority side. pensate those veterans whose lives and in which they have not only helped Mr. Speaker, this is the first veterans health have been affected by their ex- craft this legislation in a fair biparti- bill to be considered by the House in posure. Today, Mr. Speaker, we take a san manner but the way in which the this Congress. It is very fitting that step that honors our commitment to gentleman from Arizona has run the this measure is one that reforms and these veterans. committee on a bipartisan basis that I expands the health care services which I would certainly ask my colleagues think is a role model that the people of veterans can obtain from the Veterans’ to give us a unanimous vote on H.R. this country would have high respect Administration. Health care eligibility 1565. for. I appreciate the gentleman’s lead- reform is one of the most important Mr. Speaker, I reserve the balance of ership on this and other legislation and veterans issues that will face this Con- my time. the way he runs the committee. gress. Although this measure only af- Mr. STUMP. Mr. Speaker, I yield 2 My colleagues, H.R. 1565 would main- fects a small number of veterans, it is minutes to the gentleman from New tain our commitment to provide medi- important, Mr. Speaker, and it is a Jersey [Mr. SMITH], the vice chairman cal care to veterans who suffer disease step in the right direction. of the Committee on Veterans’ Affairs. as a result of exposure in service to H 6322 CONGRESSIONAL RECORD — HOUSE June 27, 1995 certain toxic substances. The authority unless scientific evidence has clearly wounds—and these are few wounds under which the VA provides such care, shown that the condition is not linked. greater than those suffered from the ef- first established in 1981, will expire at The measure we are discussing today fects of agent orange. These veterans the end of this month. H.R. 1565, as is significant legislation that provides had to wait for decades to receive rec- amended, would extend the VA’s treat- a framework for continued health serv- ognition and medical care. We must ment authority. Current law, however, ice to our Nation’s veterans who may not make them wait again. reflects the limited knowledge we had have been exposed to hazardous sub- Mr. MONTGOMERY. Mr. Speaker, I in 1981 regarding the relationship be- stances during their military service. yield myself 30 seconds. tween exposure to agent orange and an With this in mind, I am proud to vote Mr. Speaker, I commend the gen- occurrence of specific diseases. in strong support of H.R. 1565, and I tleman for mentioning the work of the This bill would incorporate the find- urge my colleagues to join in adopting gentleman from Illinois [Mr. EVANS]. ings of the National Academy of this measure. He did have a lot of interest. He has Sciences to identify the diseases for Mr. MONTGOMERY. Mr. Speaker, I put a lot of hard work in this legisla- which treatment is available. At the yield 2 minutes to the gentleman from tion on the agent orange issue. same time, the bill extends veterans California [Mr. FILNER] who is a mem- Mr. Speaker, I yield 2 minutes to the every benefit of the doubt, as we ber of the Committee on Veterans’ Af- gentlewoman from Florida [Mrs. should, and expands the scope of treat- fairs. THURMAN], a strong supporter of veter- ment which the VA may provide. Mr. FILNER. Mr. Speaker, I thank ans’ programs. Mr. Speaker, Members on both sides the gentleman for yielding time to me. Mrs. THURMAN. Mr. Speaker, I rise of the aisle have worked hard to Mr. Speaker, I rise today in support in strong support of this legislation, produce an excellent bill. I think this of H.R. 1565, legislation to renew our H.R. 1565, the extension of health care legislation is a statement that even in obligation to provide medical treat- to veterans exposed to agent orange. tough budget times, we do ask the ment for veterans suffering from expo- Both the gentleman from Mississippi American people to tighten our belts, sure to agent orange. [Mr. MONTGOMERY] and the gentleman Between 1962 and 1971, the military from Arizona [Mr. STUMP] know of the this Congress and our Nation owe a forces of the United States used 11.2 gentleman that I am going to speak of deep debt of gratitude to those who million gallons of agent orange and 8 because they have been trying to help have fought and been willing to put million gallons of other herbicides in me with this particular man’s case. their lives on the line for our country Vietnam, in order to strip the thick Mr. Speaker, this bill concerns veter- and its freedoms. I enthusiastically jungle that concealed the opposition ans who are sick today because they support this bill and thank those who forces. Most of these spraying oper- were exposed to a herbicide later found have played such an important role in ations were completed using airplanes to be dangerous. its development. and helicopters, but herbicides were John Nichols, a constituent of mine Mr. STUMP. Mr. Speaker, I yield 2 also sprayed from the ground by sol- from Bayonet Point, FL, is one of the minutes to the gentleman from New diers with back-mounted equipment. 2.7 million U.S. service men and women York [Mr. GILMAN], chairman of the After a scientific report in 1969 con- who had their lives interrupted and Committee on International Relations. cluded that one of the primary chemi- changed by the Vietnam war. Recipient Mr. GILMAN. Mr. Speaker, I am cals used in agent orange could cause of the Bronze Star and three Army pleased to rise in support of H.R. 1565, birth defects in laboratory animals, Commendation medals, John Nichols legislation to extend through Decem- U.S. forces suspended use of this herbi- left active duty after 10 years as a U.S. ber 31, 1997, health care benefits for cide—and stopped all herbicide spray- Army master sergeant. military veterans suffering from the ing the following year. Sergeant Nichols suffers from severe possible long-term side-effects of agent But thousands of soldiers had already osteoporosis, a gradual loss of bone tis- orange, ionizing radiation, and other been exposed to this chemical for sue that makes his bones brittle. John environmental hazards. This legisla- months at a time. Today, many of has suffered a number of fractures of tion, demonstrates our continuing ef- these soldiers have a significantly his spine since his condition was first forts to provide our veterans with the higher rate of diseases and death than diagnosed. benefits and the medical care that they those who did not go to Vietnam. Since The Department of Veterans Affairs have valiantly earned. Furthermore, I the end of the Vietnam war, a growing concedes that Sergeant Nichols was ex- commend the distinguished chairman body of evidence has connected several posed to agent orange based on his of the Veterans’ Affairs Committee, diseases to agent orange. service in Vietnam. The VA claims, Mr. STUMP, for his diligent efforts on I join a truly bipartisan effort in urg- however, that there is no legal or medi- behalf of our service men and women. ing support for this bill. We can do no cal basis to associate this exposure I strongly support this legislation, as less for the brave men and women who with his current medical condition. we must provide treatment to our vet- answered their country’s call to fight Distinguished specialists in bone dis- erans whose health has been affected in an unpopular war. They came home eases have recognized that Mr. Nichols’ by their service. The National Acad- to find that jobs were hard to come by, osteoporosis could be associated with emy of Sciences has conducted a com- as was emotional support for the ter- his exposure to agent orange. He prehensive review of scientific and rors they had experienced. No hero’s watched it sprayed regularly from heli- medical literature to determine the welcome for these veterans. copters outside his base camp. specific health affects of certain chemi- Today, I would also like to recognize He has been examined by some of the cals that may have been used during the work of my colleague, the gen- best specialists in the country. Thy armed conflicts. Based upon their re- tleman from Illinois, Congressman cannot find any other explanation for search, the NAS has developed four LANE EVANS. Without his perseverance, his condition except exposure to agent categories to classify diseases and their it is unlikely that we would be voting orange. However, the Veterans Admin- association to agent orange exposure. on this legislation today—and it is un- istration has still not recognized his These categories include: sufficient likely that thousands of Vietnam vet- condition as one related to exposure of evidence of association, limited/sugges- erans would be receiving the health the herbicide. tive evidence of association, inad- care that they need and deserve. If we send young men and women equate/insufficient evidence to deter- I also want to acknowledge the work into military combat in support of our mine whether an association exists, of Chairman BOB STUMP and ranking national objectives, we had better be and limited/suggestive evidence of no member SONNY MONTGOMERY of the willing to follow through once the association. Veterans’ Affairs Committee, as well as fighting ends. We must make good on H.R. 1565 authorizes the VA to offer the entire committee. This bill is the our commitment to take care of those treatment for illnesses that fall under latest in a long line of bills crafted in who were willing to fight for this coun- the first three of these categories. Thus a truly bipartisan manner for the good try. A tight budget does not free us allowing veterans to claim treatment of our veterans. from this commitment. Mr. Nichols’ for any disease that is conceivably re- Whatever our views on the Vietnam disease will not take a rest while we lated to wartime herbicide exposure war, we must all help to heal its struggle with the deficit. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6323 Mr. Speaker, this bill is a step in the from Illinois [Mr. EVANS], the gen- have struggled to cope with their illnesses right direction and I believe that it is tleman from Illinois [Mr. GUTIERREZ], have experienced much frustration and uncer- a positive step for John Nichols and and the gentleman from Massachusetts tainty over the years in their dealings with the veterans with similar ailments [Mr. KENNEDY]. Government. Today, it is the least we can do throughout our country. This truly, Mr. Speaker, has been an to respond to their illnesses without further Again, I want to thank the two gen- outstanding effort of bipartisanship, delay. tlemen who have helped me so much and I want to congratulate all those in- Mr. Speaker, the Congress is talking a great with this constituent. volved. deal about patriotism these days, during our Mr. MONTGOMERY. Mr. Speaker, we Mr. Speaker, I am proud to have been a debate over flag burning. But protecting the have some blue sheets that further ex- part of the bipartisan effort that has unani- American flag is completely meaningless un- plain this bill. If Members would come mously brought H.R. 1565 to the floor out of less we take care of our surviving veterans by the stands here, they could pick up the Veterans Committee. This is a necessary who have sacrificed their health for this coun- these sheets. and important bill, and I am glad to speak in try. We must help them heal. We should deci- Mr. Speaker, I have no further re- support of it today. sively pass H.R. 1565. quests for time, and I yield back the H.R. 1565 clarifies and simplifies the condi- Mr. QUINN. Mr. Speaker, I rise today in balance of my time. tions for coverage for victims of agent orange favor of H.R. 1565, which provides for priority Mr. STUMP. Mr. Speaker, I yield my- exposure. Veterans who exhibit characteristics health care to veterans exposed to agent or- self 1 minute. of the exposure will be covered, as will those ange, ionizing radiation, or other environ- Mr. Speaker, I would like to once whose condition demonstrates an association mental hazards. again thank the distinguished gen- with the disease. Even when available medical In 1992, this body required the National tleman and ranking member of the full data merits no conclusion on the source of Academy of Science to conduct a comprehen- committee for all his efforts, and also their condition, the veteran will be covered. sive study of the health effects of exposure to to the gentleman from Texas, [Mr. ED- This bill gives veterans every benefit of the agent orange and other herbicides. The NAS WARDS], the ranking member of the doubt. findings serve as the basis of H.R. 1565 which subcommittee, for all his hard work, In addition, veterans exposed to radiation requires certain specific diseases to be con- and to the gentleman from Arkansas during their time on active duty will be eligible sidered related to exposure for treatment pur- [Mr. HUTCHINSON], who is chairman of for hospital and nursing home care where posesÐincluding those where there is insuffi- the subcommittee. credible evidence exists of a positive associa- cient evidence to prove a connection. But we also owe a lot of thanks to tion with the disease and the defoliant. As an Often, many of our veterans, who served the staff who have put in many hours extension of the Agent Orange Act of 1991, this country with distinction during their tour in in putting this bill together. I thank this bill will also require the Department of Vietnam, have felt let down. They have felt Members on both sides of the aisle. I Veterans Affairs to work with the National that the Government has not recognized that some of their problems stem from exposure to urge, once again, passage of H.R. 1565. Academy of Sciences to evaluate and review agent orange and other herbicides. It is my Mr. Speaker, I yield 2 minutes to the all issues pertaining to agent orange. This is hope that this legislation will help drive home gentleman from Pennsylvania [Mr. a positive step that will allow veterans access the fact that we are aware of their tremendous FOX]. to the best available information on their ail- Mr. FOX of Pennsylvania. Mr. Speak- sacrifices and give our support. ments. H.R. 1565 also provides for treatment for er, as you know, I expressed the con- In short, Mr. Speaker, this is a good day for veterans subjected to ionizing radiation. These cerns of many of our veterans with the our veterans and those who have suffered veterans also deserve our assistance. original version of H.R. 1565, which re- from agent orange. We must work together to I wish to compliment my colleagues, Rep- authorizes care for agent orange and protect the interests of our Nation's veterans, resentatives HUTCHINSON and EDWARDS, for radiation exposed veterans. and this legislation marks a positive step in their leadership on this legislation. I am I am pleased that the House will now that direction. pleased to offer my support. consider a compromise version which Mrs. MINK of Hawaii. Mr. Speaker, I rise in Mr. STUMP. Mr. Speaker, I have no addresses this situation. It is impor- support of H.R. 1565, the extension of health further requests for time, and I yield tant that we ensure that no agent or- care to veterans exposed to agent orange. back the balance of my time. ange-affected veterans are overlooked The evidence continues to accumulate how The SPEAKER pro tempore (Mr. in the period between National Acad- horribly our Vietnam veterans are suffering FOLEY). The question is on the motion emy of Sciences reports. due to this defoliant agent, which saturated offered by the gentleman from Arizona I firmly believe that we must honor their lungs, their food, and their skin. [Mr. STUMP] that the House suspend our commitment to care for our veter- During the war, millions of gallons of dioxin- the rules and pass the bill, H.R. 1565, as ans, particularly those who have borne contaminated agent orange and other herbi- amended. the sacrifices of battle for our country. cides were sprayed over Vietnam. Two dec- The question was taken; and (two- I would like to express my appreciation ades later, we are seeing more and more thirds having voted in favor thereof) to the men and women of the Vietnam health effects of that exposure among our 3 the rules were suspended and the bill, Veterans of America and the American million service men and women who served as amended, was passed. Legion, as well as to many of my col- there. The National Academy of Sciences is The title of the bill was amended so leagues on the House Veterans’ Affairs investigating reports of cancer, metabolic dys- as to read: ‘‘A bill to amend title 38, Committee, for their hard work on this function, and a multitude of other disorders of United States Code, to extend through issue. the reproductive, respiratory, digestive, cir- December 31, 1997, the period during I look forward to continuing our culatory, and immune systems. We have no which the Secretary of Veterans Af- work together to address the needs of way of knowing what additional illnesses may fairs is authorized to provide priority our Nation’s veterans. develop. This bill very wisely leaves the option health care to certain veterans exposed Mr. STUMP. Mr. Speaker, I yield 1 open for new illnesses and disorders to be to Agent Orange and to make such au- minute to the gentleman from Ala- treated. thority permanent in the case of cer- bama [Mr. EVERETT]. This bill also makes VA benefits permanent tain veterans exposed to ionizing radi- (Mr. EVERETT asked and was given for those military men and women exposed to ation, and for other purposes.’’. permission to revise and extend his re- radiation during the post-World War II occupa- A motion to reconsider was laid on marks.) tion of Japan and during cold war nuclear test- the table. Mr. EVERETT. Mr. Speaker, I would ing in the Pacific. Diseases triggered by radi- f just like to congratulate the commit- ation-exposure continue to plague veterans, tee chairman, the gentleman from Ari- half a century later. While we remember our GENERAL LEAVE zona [Mr. STUMP], the gentleman from victory 50 years ago, we must not forget the Mr. CALLAHAN. Mr. Speaker, I ask Mississippi [Mr. MONTGOMERY], the suffering of those who helped bring that war to unanimous consent that all Members gentleman from Arkansas [Mr. HUTCH- a close. may have 5 legislative days in which to INSON], the gentleman from Texas [Mr. FInally, this bill ensures top treatment prior- revise and extend their remarks on the EDWARDS], the gentleman from Penn- ity for veterans exposed to either radiation or bill, H.R. 1868, and that I may include sylvania [Mr. FOX], the gentleman agent orange. This is fitting, as these veterans tabular and extraneous material. H 6324 CONGRESSIONAL RECORD — HOUSE June 27, 1995 The SPEAKER pro tempore. Is there Mr. CALLAHAN. Mr. Chairman, I SUBSIDY APPROPRIATION objection to the request of the gen- move to strike the last word. For the cost of direct loans, loan guaran- tleman from Alabama? Mr. Chairman, I just wanted to re- tees, insurance, and tied-aid grants as au- There was no objection. fresh the Members as to where we are. thorized by section 10 of the Export-Import Bank Act of 1945, as amended, $786,551,000 to f We had general debate, and since that remain available until September 30, 1997: time the weekend has intervened. FOREIGN OPERATIONS, EXPORT Provided, That such costs, including the cost Just to bring the Members of Con- of modifying such loans, shall be as defined FINANCING, AND RELATED PRO- gress up to date on where we are on in section 502 of the Congressional Budget GRAMS APPROPRIATIONS ACT, this foreign operations appropriation Act of 1974: Provided further, That such sums 1996 bill, H.R. 1868, let me tell the Members shall remain available until 2010 for the dis- The SPEAKER pro tempore. Pursu- we have worked out a bipartisan agree- bursement of direct loans, loan guarantees, ant to House Resolution 170 and rule insurance and tied-aid grants obligated in ment with both sides of the aisle, fiscal years 1996 and 1997: Provided further, XXIII, the Chair declares the House in working very hard to bring to this That up to $100,000,000 of funds appropriated the Committee of the Whole House on floor a bill that both sides could sup- by this paragraph shall remain available the State of the Union for the further port. The ranking member on the com- until expended and may be used for tied-aid consideration of the bill, H.R. 1868. mittee, the gentleman from Texas, grant purposes: Provided further, That none of the funds appropriated by this paragraph b 1258 CHARLIE WILSON, has been most cooper- ative, as have all Members of the other may be used for tied-aid credits or grants ex- IN THE COMMITTEE OF THE WHOLE cept through the regular notification proce- side that have approached the commit- dures of the Committees on Appropriations: Accordingly, the House resolved it- tee. We do not want to deny any Mem- self into the Committee of the Whole Provided further, That funds appropriated by ber the opportunity to address any this paragraph are made available notwith- House on the State of the Union for the issue they want to in this bill. Thus, standing section 2(b)(2) of the Export-Import further consideration of the bill (H.R. the open rule. Bank Act of 1945, in connection with the pur- 1868) making appropriations for foreign However, I must tell the House that chase or lease of any product by any East operations, export financing, and relat- we have 73 pending amendments to this European country, any Baltic State, or any agency or national thereof. ed programs for the fiscal year ending bill. We would like for them to be con- ADMINISTRATIVE EXPENSES September 30, 1996, and for other pur- sidered as expeditiously as possible. I For administrative expenses to carry out poses, with Mr. HANSEN in the chair. have informed the leadership, and I The Clerk read the title of the bill. the direct and guaranteed loan and insurance have discussed it with the ranking programs (to be computed on an accrual b 1300 member of our committee, we are will- basis), including hire of passenger motor ve- The CHAIRMAN. When the Commit- ing to stay here until 4 o’clock in the hicles and services as authorized by 5 U.S.C. tee of the Whole rose on Thursday, morning if that, indeed, is what the 3109, and not to exceed $20,000 for official re- ception and representation expenses for June 22, 1995, all time for general de- Members want to do. We want to have everybody here. However, at the same members of the Board of Directors, bate had expired. $45,228,000: Provided, That necessary expenses Pursuant to the rule, the bill shall be time, we are going to ask Members to (including special services performed on a considered under the 5-minute rule by be as brief as possible. contract or fee basis, but not including other titles and each title shall be considered First of all, this bill is $11.99 billion personal services) in connection with the col- as having been read. in budget authority. Most importantly, lection of moneys owed the Export-Import Before consideration of any other it is a 22-percent reduction from 1995. It Bank, repossession or sale of pledged collat- amendment, it shall be in order to con- is nearly $3 billion less than what the eral or other assets acquired by the Export- administration has requested. Import Bank in satisfaction of moneys owed sider the amendments printed in part 1 the Export-Import Bank, or the investiga- of House Report 104–147. Those amend- The American people have sent us a tion or appraisal of any property, or the ments will be considered in the order strong message telling as to cut Gov- evaluation of the legal or technical aspects printed, by a Member designated in the ernment spending, and they said to cut of any transaction for which an application report, may amend portions of the bill foreign aid as well. That is precisely for a loan, guarantee or insurance commit- not yet read for amendment, are con- what this bill does. It is drafted in such ment has been made, shall be considered sidered as having been read, are not a manner that it gives the administra- nonadministrative expenses for the purposes of this heading: Provided further, That, not- subject to amendment, and are not sub- tion a great deal of latitude. I would withstanding subsection (b) of section 117 of ject to a demand for division of the hope that we do not fall prey to some the Export Enhancement Act of 1992, sub- question. Debate on each amendment is today who will be coming before us section (a) thereof shall remain in effect limited to 10 minutes, equally divided asking us to increase this measure. until October 1, 1996. and controlled by the proponent and an The CHAIRMAN. The Clerk will des- OVERSEAS PRIVATE INVESTMENT CORPORATION opponent of the amendment. ignate title I. NONCREDIT ACCOUNT After disposition of the amendments The text of title I is as follows: The Overseas Private Investment Corpora- printed in part 1 of the report, the bill tion is authorized to make, without regard TITLE I—EXPORT AND INVESTMENT to fiscal year limitations, as provided by 31 as then perfected will be considered as ASSISTANCE original text. U.S.C. 9104, such expenditures and commit- EXPORT-IMPORT BANK OF THE UNITED STATES ments within the limits of funds available to An amendment printed in part 2 of it and in accordance with law as may be nec- the report shall not be subject to a de- The Export-Import Bank of the United States is authorized to make such expendi- essary: Provided, That the amount available mand for division of the question. tures within the limits of funds and borrow- for administrative expenses to carry out the During consideration of the bill for ing authority available to such corporation, credit and insurance programs (including an amendment, the Chairman of the Com- and in accordance with law, and to make amount for official reception and representa- mittee of the Whole may accord prior- such contracts and commitments without re- tion expenses which shall not exceed $35,000) ity in recognition to a Member who has gard to fiscal year limitations, as provided shall not exceed $26,500,000: Provided further, caused an amendment to be printed in by section 104 of the Government Corpora- That project-specific transaction costs, in- cluding direct and indirect costs incurred in the designated place in the CONGRES- tion Control Act, as may be necessary in car- rying out the program for the current fiscal claims settlements, and other direct costs SIONAL RECORD. Those amendments associated with services provided to specific will be considered as having been read. year for such corporation: Provided, That none of the funds available during the cur- investors or potential investors pursuant to The clerk will read. rent fiscal year may be used to make expend- section 234 of the Foreign Assistance Act of The clerk read as follows: itures, contracts, or commitments for the 1961, shall not be considered administrative H.R. 1868 export of nuclear equipment, fuel or tech- expenses for the purposes of this heading. Be it enacted by the Senate and House of Rep- nology to any country other than a nuclear- PROGRAM ACCOUNT resentatives of the United States of America in weapon State as defined in Article IX of the For the cost of direct and guaranteed Congress assembled, That the following sums Treaty on the Non-Proliferation of Nuclear loans, $79,000,000, as authorized by section 234 are appropriated, out of any money in the Weapons eligible to receive economic or of the Foreign Assistance Act of 1961, to be Treasury not otherwise appropriated, for the military assistance under this Act that has derived by transfer from the Overseas Pri- fiscal year ending September 30, 1996, and for detonated a nuclear explosive after the date vate Investment Corporation Noncredit Ac- other purposes, namely: of enactment of this Act. count: Provided, That such costs, including June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6325 the cost of modifying such loans, shall be as Page 9, beginning on line 15, strike ‘‘Pro- sistance. I think it was wise policy defined in section 502 of the Congressional vided further,’’ and all that follows through when it became law. I do not think this Budget Act of 1974: Provided further, That ‘‘Committees on Appropriations:’’. law should be waived. I will also point such sums shall be available for direct loan Page 16, line 23, strike ‘‘and for other pur- out that during debate on the authoriz- obligations and loan guaranty commitments poses,’’. incurred or made during fiscal years 1996 and Page 19, line 8, strike ‘‘1.5’’ and insert ‘‘1’’. ing bill, the House decisively rejected 1997: Provided further, That such sums shall an attempt to provide additional funds The CHAIRMAN. Pursuant to House for debt restructuring. remain available through fiscal year 2003 for Resolution 170, the gentleman from the disbursement of direct and guaranteed The third provision strikes language loans obligated in fiscal year 1996, and New York [Mr. GILMAN] and a Member that expands the purposes of the appro- through fiscal year 2004 for the disbursement opposed will each be recognized for 5 priation for the Freedom Support Act— of direct and guaranteed loans obligated in minutes. assistance to the former Soviet fiscal year 1997. In addition, such sums as The Chair recognizes the gentleman Union—to unspecified other purposes, may be necessary for administrative ex- from New York [Mr. GILMAN]. notwithstanding any other provision of penses to carry out the credit program may Mr. GILMAN. Mr. Chairman, I yield be derived from amounts available for ad- law. This is the kind of legislative lan- myself such time as I may consume. guage that could have the effect, how- ministrative expenses to carry out the credit Mr. Chairman, I strongly support and insurance programs in the Overseas Pri- ever unintentional, of weakening the vate Investment Corporation Noncredit Ac- this bill, which is the product of care- appropriate oversight role of the au- count and merged with said account. ful consultation with our Committee thorizing committees, since it is not at FUNDS APPROPRIATED TO THE PRESIDENT on International Relations by the sub- all clear what the other purposes of committee, under the leadership of the TRADE AND DEVELOPMENT AGENCY such additional aid would be or what For necessary expenses to carry out the gentleman from Alabama [Mr. CAL- authorities they would employ. If this provisions of section 661 of the Foreign As- LAHAN]. I commend the distinguished language were not stricken, the House sistance Act of 1961, $40,000,000: Provided, chairman, the gentleman from Ala- would be appropriating, to some de- That the Trade and Development Agency bama, and the ranking minority mem- gree, in the blind with respect to the may receive reimbursements from corpora- ber, the gentleman from Texas [Mr. somewhat troubled aid program for tions and other entities for the costs of WILSON]. The bill as a whole deserves grants for feasibility studies and other Russia and the New Independent the support of the House. I strongly States. project planning services, to be deposited as urge Members to support it on final an offsetting collection to this account and Finally, the amendment changes the to be available for obligation until Septem- passage. ratio of required private participation ber 30, 1997, for necessary expenses under this Mr. Chairman, my en bloc amend- in certain programs in Russia. This paragraph: Provided further, That such reim- ment is designed to overcome certain amendment reflects the reality that, in bursements shall not cover, or be allocated concerns I had with the bill as re- dollar terms, indigenous contributions against, direct or indirect administrative ported. Chairman CALLAHAN, Chairman by Russians, valued in dollars, are nec- costs of the agency. SOLOMON, and I agreed that the best essarily going to be very small, and it INTERNATIONAL FINANCIAL INSTITUTIONS way to handle these concerns, which will be very difficult to reach the re- CONTRIBUTION TO THE INTERNATIONAL FINANCE might otherwise be subject to a point quired ratio for many projects. CORPORATION of order, would be for me to offer two In a compromise with Chairman CAL- For payment to the International Finance amendments. This is the first of those LAHAN, we agreed to reduce this ratio Corporation by the Secretary of the Treas- amendments. from 1.5 to 1 down to 1 to 1. It will re- ury, $67,550,000, for the United States share The amendment would strike three of the increase in subscriptions to capital flect an equal partnership between the stock, to remain available until expended: legislative provisions and alter a third. public and private sectors It was my Provided, That of the amount appropriated The first provision strikes legislative understanding from the appropriations under this heading not more than $5,269,000 language in the Child Survival and Dis- committee staff that this change would may be expended for the purchase of such eases Fund Program that would allow help groups like Save the Children in stock in fiscal year 1996. funds appropriated to the fund to be Russia and other New Independent CONTRIBUTION TO THE ENTERPRISE FOR THE made available notwithstanding any States. AMERICAS MULTILATERAL INVESTMENT FUND other provision of law. Mr. Chairman, I appreciate the effort For payment to the Enterprise for the This language is inappropriate, in my made by Chairman CALLAHAN and Americas Multilateral Investment Fund by view, because it would set aside appro- Rules Committee Chairman SOLOMON the Secretary of the Treasury, for the United priate provisions of the Foreign Assist- to help me address several concerns States contribution to the Fund to be admin- ance Act and give the administration istered by the Inter-American Development that have come up during consider- Bank, $70,000,000 to remain available until little guidance beyond the bill’s six ation of this bill. expended. child survival purposes. We had unprecedented cooperation Mr. WILSON. Mr. Chairman, I move In recent days, Members expressed between the subcommittee and our to strike the last word. concerns about the child survival sec- Committee on International Relations. Mr. Chairman, I would like to echo tion of the Foreign Assistance Act. The Chairman CALLAHAN addressed some of what the chairman of our subcommit- International Relations Committee my concerns through an amendment he tee said. The minority is perfectly will- will be considering legislation later offered in full committee and I thank ing to stay here until 4 o’clock in the this summer to update the Child Sur- him for that. With the adoption of this morning to finish the bill. vival Program. We will update provi- amendment and the one that I will I would also like to underline that sions of the FAA and take care of any offer next, our committees will be in the bill is a fairly fragile compromise, concerns with current law. I trust it sync. and I hope that we can keep it from will be a bipartisan bill and would seek The CHAIRMAN. Is there a Member being fundamentally changed. As it is its rapid adoption in the Congress. opposed to the amendment offered by now, I think it is veto-proof. I think The second provision would strike the gentleman from New York? that would be a very constructive the provision that allows the transfer Mr. WILSON. Mr. Chairman, I rise in thing for the House to do. of funds from AID’s Development As- opposition to the amendment. sistance account to the Treasury De- AMENDMENT OFFERED BY MR. GILMAN The CHAIRMAN. The gentleman Mr. GILMAN. Mr. Chairman, I offer partment for debt restructuring. Given from Texas [Mr. WILSON] is recognized an amendment. the cuts to the Development Accounts for 5 minutes. The CHAIRMAN. The Clerk will des- in the authorizing bill, our Inter- Mr. WILSON. Mr. Chairman, I rise in ignate the amendment. national Relation Committee chose not opposition to the amendment. The text of the amendment is as fol- to allow the transfer funds from devel- This amendment would delete a pro- lows: opment assistance to other accounts in vision that waives legislative restric- violation of section 109 of the Foreign tions for programs for child survival. Amendment offered by Mr. GILMAN: Page 8, beginning on line 9, strike ‘‘shall be Assistance Act. The policy of section Over the past several years the com- made available notwithstanding any other 109 of the FAA is clear—funds may not mittee has included this provision in provision of law, and’’. be transferred from development as- the bill because programs for children H 6326 CONGRESSIONAL RECORD — HOUSE June 27, 1995 should be carried out without technical tives. Administration lawyers have as- Mr. SMITH of New Jersey. Mr. Chair- or political restrictions. sured us that reverting to the cus- man, I ask unanimous consent for an The provision has enabled aid to help tomary term ‘‘and for related pro- additional 3 minutes, and that it be displaced children, orphans, and other grams’’ as a result of the deletion pro- equally divided between both sides. children in distress in Bosnia, Mozam- posed by the chairman, the gentleman The CHAIRMAN. Is there objection bique, Somalia, and Rwanda. from New York [Mr. GILMAN], will in to the request of the gentleman from It enables the United States to re- no way reduce the ability of the coordi- New Jersey? spond quickly to assist children as a nator and special advisor to obligate There was no objection. result of natural disasters, war, and the these funds. They may be used for any The CHAIRMAN. The Chair recog- spread of disease. activities in the former Soviet Union nizes the gentleman from New Jersey Assistance to children for immuniza- that were requested by the administra- [Mr. SMITH]. tion, family reunification, and other tion and the Committee on Appropria- Mr. SMITH of New Jersey. Mr. Chair- assistance is the one area in the for- tions. man, I am concerned with the part of eign assistance area where we can sta- Mr. Chairman, I am not going to ask the amendment that would delete the tistically show that benefits are for a recorded vote, I would say to the phrase ‘‘notwithstanding any other achieved and in fact lives are saved. gentleman from Texas [Mr. WILSON]. provision of law’’ from the Child Sur- UNICEF has estimated that the United Mr. ROTH. Mr. Chairman, will the vival and Disease Programs Fund in States program for child survival has gentleman yield? title II. I would just ask the chairman saved more than 1 million lives during Mr. GILMAN. I am pleased to yield 30 of the full committee for a clarifica- the past 10 years. seconds to the gentleman from Wiscon- tion. If the amendment passes, can the Mr. Chairman, there are a number of sin [Mr. ROTH], a senior member of the House be assured that the money in the legislative provisions in this bill that Committee on International Relations. fund would not be used or available for have been here for a number of years— Mr. WILSON. Mr. Chairman, I yield population assistance? 30 seconds to the gentleman from Wis- since there hasn’t been an authoriza- b 1315 tion bill signed into law for more than consin [Mr. ROTH]. The CHAIRMAN. The gentleman 10 years. We have such money designated. It I do not know why the gentleman has from Wisconsin [Mr. ROTH] is recog- has been used in the past. My hope is chosen this one to strike. But I think nized for 1 minute. that this day on point for child sur- Mr. ROTH. Mr. Chairman, I thank for the sake of saving lives of children, vival interventions, immunizations, the gentleman for yielding time to me. Members should vote against the Gil- oral rehydration, and the like, and Mr. Chairman, we have two amend- those things that were expressed on the man amendment. ments here that are very important. Mr. CALLAHAN. Mr. Chairman, will bottom of page 7 and page 8 of the bill. The first one deletes authorizing lan- Mr. GILMAN. Mr. Chairman, will the the gentleman yield? guage from the bill which runs directly Mr. WILSON. I yield to the gen- gentleman yield? contrary to the provisions that came tleman from Alabama. Mr. SMITH of New Jersey. I yield to out of the Committee on International Mr. CALLAHAN. Mr. Chairman, I the gentleman from New York. Relations and were written in the law. Mr. GILMAN. If the amendment thank the gentleman for yielding. In one instance, the bill waives all Mr. Chairman, the pending first passes, the House can be assured the provisions of law in providing funds for money in the fund would not be avail- amendment provided for under the certain health-related programs. In an- rule, by the chairman of the Commit- able for population assistance. other instance, the bill authorizes $15 Mr. SMITH of New Jersey. Mr. Chair- tee on International Relations, and in- million of debt relief in Africa. In an- man, I thank the gentleman for clarify- cidentally, I want to thank the chair- other, the bill authorizes the transfer ing that. man for his cooperation during this of $15 million from the development The CHAIRMAN. Under the unani- process, and for helping me through his fund for Africa. That is why these mous-consent argument, the gen- very knowledgeable history in foreign amendments are important. tleman from Texas [Mr. WILSON] is rec- relations. In offering these amendments, the ognized for an additional 11⁄2 minutes. However, the amendment of chair- gentleman from New York is making a Mr. WILSON. Mr. Chairman, I have man of the Committee on International very important point. The point is this: no further requests for time, and I Relations reflects discussions between appropriations bills should be consist- yield back the balance of my time. us prior to the Committee on Rules ent with the authorization bills. This is The CHAIRMAN. The question is on hearing last week. By way of expla- not the case here. I understand the the amendment offered by the gen- nation, the ‘‘notwithstanding’’ provi- tendency, as has been pointed out by tleman from New York [Mr. GILMAN]. sion that is deleted in this amendment the gentleman from Texas [Mr. WIL- The amendment was agreed to. was inserted by the Committee on Ap- SON], that in the past 10 years we have The CHAIRMAN. It is now in order to propriations to allow the executive not had an authorization bill enacted. consider amendment No. 2 printed in branch to act more expeditiously than Now we have an authorization bill that part 1 of House Report 104–147. the Foreign Assistance Act would has been passed. Before, yes, the appro- AMENDMENT OFFERED BY MR. GILMAN allow in the case of epidemics. The priations bill carried the burden of the Mr. GILMAN. Mr. Chairman, I offer diphtheria epidemic now sweeping authorization bill. an amendment. across the former Soviet Union is a Mr. WILSON. Mr. Chairman, if the The CHAIRMAN. The Clerk will des- case in point. gentleman will yield, he means he has ignate the amendment. According to the General Accounting had an authorization bill passed. The text of the amendment is as fol- Office, AID delayed contracting with Mr. ROTH. Yes, Mr. Chairman. What lows: the Centers for Disease Control in At- we are saying is the authorization bill Amendment offered by Mr. GILMAN: Page 8, lanta, when diphtheria struck the should set the standard. The appropria- line 16, strike ‘‘$669,000,000’’ and insert Ukraine more than a year ago. Now tions should dovetail into the author- ‘‘$645,000,000’’. that the epidemic has spread, we ac- ization bill. The CHAIRMAN. Pursuant to the cept the chairman’s assurances that The CHAIRMAN. All time has ex- rule, the gentleman from New York the ‘‘notwithstanding’’ clause is unnec- pired. [Mr. GILMAN] will be recognized for 5 essary to prevent future delays in re- Mr. SMITH of New Jersey. Mr. Chair- minutes, and a Member opposed will be sponding to epidemics to prevent fu- man, I ask unanimous consent for 2 ad- recognized for 5 minutes. ture delays in responding to epidemics ditional minutes to engage in a col- The Chair recognizes the gentleman abroad. loquy with the maker of the amend- from New York [Mr. GILMAN]. The two language changes in the ment. Mr. GILMAN. Mr. Chairman, I yield heading ‘‘Assistance for the New Inde- The CHAIRMAN. The Chair would myself such time as I may consume. pendent States of the Former Soviet advise the gentleman, only if the time Mr. Chairman, I urge Members’ sup- Union’’ should not change the Commit- is equally divided by each side can the port for the Gilman-Brownback amend- tee on Appropriation’s original objec- Chair entertain that request. ment. This amendment simply reduces June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6327 the foreign aid development assistance payer funding of foreign assistance. ment assistance and assistance to Afri- budget to the level approved by the However, the committee should not ca, we would reduce somewhat the House on June 8. have used the additional savings to huge cuts that had already taken place When the House debated the Amer- raise the funding levels of the Develop- in those accounts. ican Overseas Interests Act (H.R. 1561), ment Assistance Fund. The problem with this amendment is we supported a total funding level of I agree that the United States should that it is cutting an account which has $858 million for development assist- be providing development assistance already been cut by 40 percent at the ance. This amount reflected a balanced for programs that further U.S. inter- same time that military assistance in reduction in foreign aid to meet our ests abroad. However, because of the this bill is $1 million above last year’s budget reduction targets included in importance of balancing the budget level. the House-passed budget resolution. I and reducing the deficit, we need to re- We do not believe that that is a bal- strongly support these programs but duce our overall level of development anced approach, we do not think you must note that we must show spending assistance. As a result, we need to re- ought to do that, and frankly I do not restraint in a time of $200-billion defi- evaluate our development assistance instead to support a bill if it becomes cits. priorities. nothing but a delivery mechanism for Chairman CALLAHAN’s bill was Providing more than $27,000,000 to warped priorities. marked up in subcommittee while the Nepal is not a priority. It seems to me it is essential for us Overseas Interests Act was debated on Providing almost $19,000,000 to Sri to stick with a bipartisan product. If the floor—therefore amounts in the bill Lanka is not a priority. this amendment is passed, you abandon are not identical to the authorizing Providing almost $10,000,000 to that. bill. Our amendment would simply re- Yemen is not a priority. Mr. Chairman, I yield to the gen- duce the amounts in the bill for this I do not want to gut these programs tleman from Louisiana [Mr. LIVING- particular account to the authorized of the entire fund. But I cite these pro- STON]. level as passed in the House. We sup- grams as examples of areas in which Mr. LIVINGSTON. Mr. Chairman, I port Chairman CALLAHAN’s Child Sur- cost-cutting could and should occur. was going to ask the gentleman from vival Program and our amendment Mr. Chairman, I ask for the passage Alabama [Mr. CALLAHAN] to yield time. would not cut a penny from that ac- of the bill. The CHAIRMAN. The gentleman count or AID funds for Africa. My col- Mr. WILSON. Mr. Chairman, I am from Wisconsin [Mr. OBEY] controls the leagues recall that the budget savings confused. Do I control 5 minutes of the time. in the Overseas Interests Act were en- time? Mr. OBEY. Mr. Chairman, it is my dorsed by Chairman KASICH and the fol- The CHAIRMAN. Is the gentleman understanding that there is only 1 lowing organizations: the National from Texas opposed to the amendment? minute left. Taxpayers Union Foundation, Ameri- Mr. WILSON. I am extremely op- Mr. WILSON. I think I control the cans for Tax Reform, the Association posed, Mr. Chairman. time, Mr. Chairman. of Concerned Taxpayers, and Citizens The CHAIRMAN. The gentleman The CHAIRMAN. The gentleman Against Government Waste. Remem- from Texas [Mr. WILSON] is recognized from Texas [Mr. WILSON] controls the bering the support of these budget-con- for 5 minutes in opposition to the time in opposition. The gentleman scious groups, I urge support for the amendment offered by the gentleman from New York [Mr. GILMAN] has 1 Gilman-Brownback amendment. from New York [Mr. GILMAN]. The gen- minute remaining. Mr. Chairman, I yield 2 minutes to tleman from New York [Mr. GILMAN] The gentleman from Wisconsin still the gentleman from Kansas [Mr. has 1 minute remaining. has the time that was yielded to him, BROWNBACK]. Mr. WILSON. Mr. Chairman, I yield 3 minutes. Mr. BROWNBACK. Mr. Chairman, I myself such time as I may consume. Mr. OBEY. That is my impression. rise today in strong support of the Gil- Mr. Chairman, I am extremely op- My understanding is that there will be man-Brownback amendment to reduce posed to this amendment for many, no time for the gentleman from Louisi- the Development Assistance Fund to many reasons, but basically because ana [Mr. LIVINGSTON] or the gentleman the level authorized by H.R. 1561, the the funding levels in this bill were from Alabama [Mr. CALLAHAN] unless I American Overseas Interests Act. reached after very, very careful nego- My support for reducing the Develop- yield to them, which I am trying to do. ment Assistance Fund is not based on a tiations in order to bring a bipartisan Mr. CALLAHAN. Mr. Chairman, if I desire to gut USAID’s development as- bill to the floor, a bill that would be might, respectfully ask for unanimous sistance program. Nor is it based on a veto-proof, a bill that could gain wide consent to extend the debate for 3 addi- desire to unfairly single out individual acceptance through all elements of tional minutes on each side and then I projects for outright elimination. both parties, and to cut $25 million would ask the gentleman from New The problem is we are broke. This fis- here out of development assistance, York [Mr. GILMAN], chairman of the cal year, the Federal Government is which would mean a 40 percent total Committee on International Relations, forecasted to spend over $200 billion cut, I think would endanger that com- to yield his 3 minutes to me so I can more than it takes in. That annual def- promise. recognize the gentleman from Louisi- icit will add to our current national Mr. Chairman, I yield 3 minutes to ana [Mr. LIVINGSTON], chairman of the debt of almost $5 trillion. the gentleman from Wisconsin [Mr. Committee on Appropriations, and we We cannot afford to continue our cur- OBEY]. each would have additional time. rent spending habits. That is why the Mr. OBEY. Mr. Chairman, I would The CHAIRMAN. Is there objection new Republican majority in the House simply say this: If the House wants to to the request of the gentleman from has crafted a balanced budget resolu- have bipartisan support for this bill, it Alabama? tion, and we must meet our budget tar- needs to defeat this amendment. If it Mr. BURTON of Indiana. Mr. Chair- gets. does not care about getting support for man, reserving the right to object, we I cosponsor this amendment to the this bill from this side of the aisle and have, I think, 2 or 3 speakers on this foreign aid authorization bill, H.R. wants to pass it all on your own, then side that have served on the Commit- 1561, to bring its funding levels in com- vote for the amendment, because that tee on Foreign Affairs/International pliance with the budget resolution tar- is going to be the result. Relations who feel very strongly about get. When we came out of the subcommit- this amendment. We would like to have Although this foreign operations bill tee, we had reached a very delicate a minute or two for us to express our overall spends even less on foreign aid compromise. Basically what we had feelings. than the budget resolution’s target, done is, taking into account the level I would ask unanimous consent in- H.R. 1868 raises the level of the Devel- of DA already recommended by the stead of 3 minutes that we have 7 min- opment Assistance Fund by approxi- subcommittee, we simply suggested utes so we can split it 31⁄2 minutes on mately $25 million. that other accounts that had been in- each side. I applaud the Appropriations Com- creased over last year be reduced so The CHAIRMAN. Does the gentleman mittee for lowering the level of tax- that through a combination of develop- from Alabama modify his request? H 6328 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Mr. CALLAHAN. Yes, Mr. Chairman. agreement and risk losing support from taxpayers’ dollars, so they could ask The CHAIRMAN. Is there objection our minority party members. It seems for more money. to the request of the gentleman from extremely counterproductive to lose They don’t need more money. We Alabama? the bipartisan support we have worked don’t need to be spending this $24 mil- Mr. BURTON of Indiana. Mr. Chair- so hard to achieve, merely to prove our lion. man, further reserving the right to ob- unequivocal compliance with the au- I say to my colleagues who are fis- ject, is the gentleman from Alabama thorizing legislation. Especially since cally responsible, vote for this amend- [Mr. CALLAHAN] planning to give the we conform with the authorization bill ment. It takes it back to the authoriz- chairman of the Committee on Appro- in almost all respects, and overall $375 ing level, which was a reasonable fig- priations 3 minutes? million below the total funding level ure. We do not need to be going above Mr. CALLAHAN. Mr. Chairman, I assumed in the authorization bill. authorized levels if we are really con- am, when they yield to me. In addition to breaking bipartisan cerned about balancing the budget. Mr. BURTON of Indiana. Mr. Chair- support, this bill is wrong on the mer- Mr. CALLAHAN. Mr. Chairman, I man, further reserving the right to ob- its. Our committee provided a $25 mil- yield 1 minute to the gentleman from ject, that being the case, then I think lion increase for child survival activi- Illinois [Mr. MANZULLO]. we need more than the 3 minutes. We ties in the newly created child survival b 1330 need 10 minutes. and disease programs fund This was Mr. OBEY. Mr. Chairman, is all of done to accommodate a bipartisan ef- Mr. MANZULLO. Mr. Chairman, very this coming out of my time? fort to protect funding for child sur- briefly, what we are trying to do here The CHAIRMAN. Each side has to be vival and infectious disease programs. is to roll back the aid to the Develop- equally treated in this area. Not only did we maintain a separate ment Assistance Fund $24 million, back Mr. BURTON of Indiana. Mr. Chair- account, we were able to increase the to the authorizing levels. It is very man, I ask unanimous consent that de- level by $25 million because of wide simple. We are trying to save some bate on this amendment be extended by support for protecting children. money. an additional 10 minutes equally di- Mr. GILMAN’s amendment, while un- Mr. Chairman, I rise in support of Mr. GIL- vided on each side. derstandable for jurisdictional reasons, MAN's amendment to strike $24 million from The CHAIRMAN. Is there objection is a bad amendment for the children of the Development Assistance Fund [DAF] in an to the request of the gentleman from the world. In order to keep bipartisan- effort to cut spending and reduce the deficit Indiana? ship and to protect children, I urge op- and national debt. There was no objection. Today the national debt stands at over The CHAIRMAN. The gentleman position to this amendment. $4.89 trillionÐthat's right, trillionÐdollars. In from New York [Mr. GILMAN] will be Mr. GILMAN. Mr. Chairman, I yield fact, the debt continues to increase by $9,600 recognized for an additional 5 minutes, the balance of my time to the gen- every second, which means that by the time I and the gentleman from Texas [Mr. tleman from Alabama [Mr. CALLAHAN], conclude my remarks, the national debt will WILSON] will be recognized for an addi- the distinguished chairman of the Sub- have risen by another $576,000Ðanother half tional 5 minutes. committee on Foreign Operations of Mr. OBEY. Could I ask the Chair how the Committee on Appropriations, and a million dollars of fiscal liability placed on the much time I have remaining? I ask unanimous consent that he be al- backs of our children. The CHAIRMAN. The time of the lowed to control that time. Mr. Chairman, given this fiscal crisis, we as gentleman from Wisconsin [Mr. OBEY] The CHAIRMAN. Is there objection responsible legislators must continue to look has expired. to the request of the gentleman from for ways to make reasonable cuts in govern- Mr. OBEY. I thank the Chair. New York? ment spending. The amendment before us Mr. WILSON. Mr. Chairman, I yield 3 There was no objection. now makes such a reasonable reduction. Two minutes to the gentleman from Louisi- The CHAIRMAN. The gentleman weeks ago, we passed a foreign aid authoriza- ana [Mr. LIVINGSTON], the chairman of from Alabama [Mr. CALLAHAN] is recog- tion bill that set spending levels for the Devel- the full committee. nized for 6 minutes. opment Assistance Fund at $858 million. The Mr. LIVINGSTON. Mr. Chairman, I Mr. CALLAHAN. Mr. Chairman, I appropriations bill we are currently considering thank the gentleman for yielding me rise in strong opposition to the amend- proposes to spend $25 million above the au- the time. I doubt I will use the full 3 ment, but I am going to speak last on thorized amount on the DAF. The Gilman minutes. it. amendment simply brings the appropriation in Mr. Chairman, the Gilman amend- At this point, though, in fairness to line with the levels authorized without touching ment reduces the development assist- all concerned, I yield 1 minute to the the Child Survival Program. ance account by $24 million in order to gentleman from Indiana [Mr. BURTON]. I think we all agree, Mr. Chairman, that cut- bring the bill in line with the author- Mr. BURTON of Indiana. I thank the ting spending to reduce the deficit and the ization bill. I understand and support gentleman for yielding me the time. debt is necessary and will bode well for the his desire to appropriate within House- Mr. Chairman, first of all, we are not economy and for future generations of Ameri- passed authorization levels. However, I going to be allowing children to starve cans. I think we can agree, too, that a very respectfully disagree with Mr. GILMAN if we pass this amendment. The author- basic step in controlling spending is to keep on the merits, and the effect of this izing committee came up with a rea- appropriations within approved authorization specific amendment. sonable amount of money to deal with levels. This amendment does just that. Let's Our committee was forced to not the problems of the world. The problem stop the half-a-million-a-minute trend of debt only work with the authorizing levels, is the authorizing committee came up accumulation. I support the amendment by the but also to work out billions in cuts in with a figure and now we are going distinguished chairman and I urge the support a politically difficult bill. above that with the Appropriations of my colleagues. Chairman CALLAHAN displayed amaz- Committee of $24 million. We do not Mr. ROTH. Mr. Chairman, will the ing leadership and consensus building need to be spending that money at a gentleman yield? skills in developing a bipartisan con- time when we are having fiscal prob- Mr. MANZULLO. I yield to the gen- sensus on how we should distribute the lems. tleman from Wisconsin. declining foreign assistance dollars. I want to read what one of the Chief Mr. ROTH. Mr. Chairman, I basically Each member of the subcommittee out- of Staffs of AID said, Larry Byrne. He have a question. I realize Chairman lined their priorities and we com- said that AID was 62 percent through CALLAHAN and ranking member WILSON promised in order to report a bill with the fiscal year and they had only spent have done a good job and we congratu- wide bipartisan support. Mr. WILSON 38 percent of their dollar volume. They late them on that. As I interpret this and Mr. OBEY both support this legisla- needed to spend a $1.9 billion in the amendment, the nub of the issue basi- tion. I think it is important that we next 5 months. Now, get that. cally is this. The gentleman’s amend- maintain the support of the minority They were two-thirds through the ment takes us back to the authoriza- in order to get this bill through. year and they had only spent one-third tion bill and basically cuts it $24 mil- However, if we agree to Mr. GILMAN’s of their money so they had to speed up lion. It brings it back to the authoriza- amendment, we break our bipartisan the spending process, to blow American tion fund. There is no jurisdiction fight June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6329 or anything as I read it; it is just going level for the Development Assistance sectors including population assistance, once back to the authorization bill. Fund. However, that is only due to the the child survival and disease programs ear- Mr. GILMAN. Mr. Chairman, will the fact that the committee provided a $25 mark is deducted. Under the current bill, popu- gentleman yield? million increase for child survival ac- lation assistance will get approximately a 49- Mr. MANZULLO. I yield to the gen- tivities in the newly created Child Sur- percent cut from the 1996 request level. Now, tleman from New York. vival and Disease Programs Fund. Mr. GILMAN asks us to cut an additional $25 Mr. GILMAN. Mr. Chairman, the gen- Creation of this new fund was a re- million. This cut would have a devastating and tleman from Wisconsin is precisely cor- sponse to a bipartisan effort to protect irreversible effect on the well-being of women rect. It cuts development assistance by funding for child survival and infec- and children throughout the world. $24 million, down to $645 million, to the tious disease programs of the Agency These cuts would directly result in the loss level the House authorized back on for International Development. Mem- of family planning and other reproductive June 8. It does not cut child survival or bers from both sides of the aisle on health services to millions of women who need Africa development funds. both the authorizing and appropria- them. Ultimately, cuts in USAID population Mr. WILSON. Mr. Chairman, I yield 2 tions committees discussed this matter funding will affect the size of the world's popu- minutes to the gentleman from Califor- with me, and I decided to protect these lation for decades to come. Our decisions nia [Mr. BERMAN]. programs by creating a separate appro- here today will determine whether the world's (Mr. BERMAN asked and was given priations account. population stabilizes under 10 billion, or permission to revise and extend his re- Not only did we maintain funding for whether it doubles from its current size to marks.) child survival programs at the 1995 reach 12 billion by 2050, and continues to Mr. BERMAN. Mr. Chairman, I urge level of $275 million, we were able to grow thereafter. the body to reject the amendment. The increase this level by $25 million. Among the immediate consequences of a fact is the appropriations bill that is In addition, I worked hard to achieve 50-percent cut are an estimated 1.6 million un- before us is below the 602(b) allocation bipartisan support for this bill. Part of intended pregnancies per year, which would for the 150 account. The total of the that compromise involved slightly have been directly prevented through USAID bill does not exceed the authorization higher funding levels for development supported family planning activities. These level. it is $400 million below the au- assistance programs. I believe it is very pregnancies will result in 1.2 million unwanted thorization level. important that foreign policy legisla- births, 363,000 otherwise unneeded abortions, As was mentioned by Chairman LIV- tion, to the extent it is possible, be and 8,000 maternal deaths. INGSTON and Chairman CALLAHAN, the supported by Members on both sides of Programs lost or dramatically reduced due $24 million increase in the development the aisle. to severe budget cuts would include research assistance was a major part, a very In my opinion, we do not violate the programs developing new contraceptive meth- small amount of money, but it was a authorizing committee one iota. We ods and methods to help prevent HIV/AIDS major part of deciding whether this have created a child survival account transmission. In addition, programs targeted at body is going to go back to a bipartisan to make absolutely certain that the reducing the heavy reliance on abortion in approach trying to deal with the very children that we are helping worldwide, countries like Russia and the New Independ- important question of foreign assist- the starving children that you see on ent States would have to be reduced or dis- ance. television in these Third World coun- continued. I ask my colleagues to remember, the tries and underdeveloped countries, are Moreover, with the cuts proposed here appropriations bill is below the 602(b) the ones that will suffer. today, USAID will be unable to continue its allocation, that is in the budget resolu- Let me encourage my colleagues in mission of bringing family planning and repro- tion that passed the House. The appro- this House to keep this bipartisan ductive health services to the world. Over 120 priations bill in total is $400 million agreement together; to reject the Gil- million women have an unmet need for family below the authorization level. And we man amendment. planning services today. During the next dec- are talking about $24 million for devel- Many of the funding levels in this bill were ade, 200 million more women will reach their opment assistance to support the most developed with that end in mind. reproductive years, creating increased de- critical programs in the foreign assist- I want to stress that this bill already makes mand for services. The world cannot afford for ance program; the kinds of aid that the largest reduction from a President's re- the USAID programs to be crippled by severe goes directly to people, that is not gov- quest for foreign aid in 20 years. It is 19 per- budget cuts. ernment-to-government, that is not cent below the administration's request, and One of the most important forms of aid that going to be squandered. over 11 percent below last year's level. We the United States provides to other countries And what is the benefit of this? We have done our job on the Appropriations Com- is family planning assistance. No one can go back to a bipartisan approach to the mittee to reduce spending on international re- deny that the need for family planning services foreign assistance program. That is lations. in developing countries is urgent and the aid worth something. I am sorry the I have the greatest respect for Chairman that we provide is both valuable and worth- amendment is being offered. I hope it is GILMAN. He did an outstanding job under very while. rejected. I think it is critical to the fu- difficult circumstances when he successfully Mr. GILMAN's additional cut of $25 million is ture of how we handle foreign assist- managed the authorization bill several weeks a gratuitous swipe at family planning. To de- ance programs in this body. ago. Therefore I can understand his reluc- mand additional cuts on top of the 49-percent Mr. WILSON. Mr. Chairman, I think tance to agree to an appropriations bill that reduction, is to say to the world that the Unit- it would benefit the House for the gen- does not completely comply with the author- ed States does not care. tleman from Alabama [Mr. CALLAHAN] ization. Mr. Chairman, I urge my colleagues to vote to close. However, I have developed a bipartisan bill against the Gilman amendment. Mr. Chairman, I yield back the bal- with Mr. WILSON and Mr. OBEY, and I must op- Mr. CALLAHAN. Mr. Chairman, I ance of my time. pose this amendment. I do so with the utmost yield back the balance of my time. Mr. CALLAHAN. Mr. Chairman, I respect for Chairman GILMAN, but I believe the The CHAIRMAN. All time has ex- yield myself such time as I may committee process has resulted in a good bill pired. consume. that we can all support. The question is on the amendment I too rise in opposition to the Gilman Mrs. LOWEY. Mr. Chairman, I rise in oppo- offered by the gentleman from New amendment. So just let me reinform sition to the Gilman amendment that would York [Mr. GILMAN]. the committee that we have worked slice $25 million from the Development Assist- The question was taken; and the hard. We have bipartisan support. ance Fund. Chairman announced that the noes ap- The Appropriations Committee has The Development Assistance Fund, which peared to have it. reported a bill that conforms with the finances family planning programs, has be- RECORDED VOTE authorization bill in almost all re- come the slush fund of choice for Members of Mr. BURTON of Indiana. Mr. Chair- spects. In fact, overall we are $375 mil- this body. Everyone is raiding the develop- man, I demand a recorded vote. lion below the total funding level as- ment assistance potÐa pot that is almost A recorded vote was ordered. sumed in the authorization bill. empty already. The vote was taken by electronic de- Chairman GILMAN maintains that we Currently, this bill designates approximately vice, and there were—ayes 202, noes 218, are $25 million over the authorization $669 million for development assistance for all not voting 14, as follows: H 6330 CONGRESSIONAL RECORD — HOUSE June 27, 1995 [Roll No 420] Green McDermott Sanders ple, and this amendment begins that Gutierrez McHale Sawyer process. AYES—202 Hall (OH) McKinney Schroeder Mr. Chairman, this amendment offers Allard Gekas Myrick Hamilton McNulty Schumer Armey Geren Nethercutt Hansen Meehan Scott a crystal clear test case to show all of Baker (CA) Gillmor Neumann Harman Meek Serrano our constituents that Congress has the Ballenger Gilman Ney Hastings (FL) Menendez Shaw Hefner Miller (CA) guts to take a bite out of corporate Barcia Goodlatte Norwood Sisisky Hilliard Mineta welfare. It will be a recorded vote to Barr Goodling Nussle Skaggs Hinchey Mink Barrett (NE) Goss Oxley Skeen stop the Federal Government acting Holden Mollohan Bartlett Graham Parker Skelton through the Overseas Private Invest- Bass Greenwood Hoyer Moran Slaughter Paxon Hunter Morella ment Corporation, OPIC, from commit- Bereuter Gutknecht Petri Spratt Bevill Hall (TX) Jackson-Lee Murtha ting billions more in U.S. taxpayer dol- Pombo Stark Bilbray Hancock Jacobs Nadler Stokes lars to help Fortune 500 companies. Portman Johnson (CT) Neal Bilirakis Hastert Studds Poshard Johnson (SD) Oberstar What this amendment does very sim- Bliley Hastings (WA) Stump Quillen Johnson, E. B. Obey ply is, it says that OPIC, a Federal Blute Hayes Stupak Quinn Johnston Olver Bono Hayworth Tejeda agency, can no longer commit and put Radanovich Kaptur Ortiz Browder Hefley Thompson at risk tens of billions of dollars of tax- Ramstad Kennedy (MA) Orton Brownback Heineman Thornton payer money for the largest corpora- Bryant (TN) Herger Roberts Kennedy (RI) Owens Rohrabacher Kennelly Packard Thurman tions in America. Bunning Hilleary Torres Burr Hobson Ros-Lehtinen Kildee Pallone OPIC is a small, obscure Federal Roth Kleczka Pastor Towns Burton Hoekstra Tucker agency which has its hands deep into Buyer Hoke Roukema Klink Payne (NJ) Velazquez the pockets of every American tax- Calvert Horn Royce Knollenberg Payne (VA) Vento Canady Hostettler Salmon Kolbe Pelosi payer. It receives at least $26 million Visclosky Castle Houghton Sanford LaFalce Peterson (FL) Volkmer every year in appropriated funds, but, Chabot Hutchinson Saxton Leach Peterson (MN) Vucanovich more importantly, it has already Chambliss Hyde Scarborough Levin Pickett Waldholtz Chapman Inglis Schaefer Lewis (CA) Pomeroy placed at risk, at risk, $6.3 billion of Walsh Chenoweth Istook Schiff Lewis (GA) Porter taxpayer money, and it keeps on get- Ward Christensen Johnson, Sam Seastrand Lightfoot Pryce Waters ting bigger. Chrysler Jones Sensenbrenner Lipinski Rahall Watt (NC) Why is OPIC such a juicy target for Clinger Kanjorski Shadegg Livingston Rangel Waxman Coble Kasich Shays Lofgren Reed cutting corporate welfare? It seems to White Coburn Kelly Shuster Lowey Regula me, Mr. Chairman, that it makes no Wicker Collins (GA) Kim Smith (MI) Maloney Richardson Manton Wilson sense at all that the Congress provide Combest King Smith (NJ) Riggs Markey Rivers Wise incentives for large American corpora- Condit Kingston Smith (TX) Martinez Roemer Wolf Cooley Klug Smith (WA) tions to invest in politically unstable Mascara Rogers Woolsey Cox LaHood Solomon countries around the world. If huge Matsui Rose Wyden Cramer Largent Souder McCarthy Roybal-Allard Wynn Fortune 500 companies, like General Crane Latham Spence Cremeans LaTourette McCrery Rush Yates Electric, duPont, Caterpillar, Westing- Stearns McDade Sabo Young (AK) Cunningham Laughlin Stenholm house, and on and on it goes, want to Deal Lazio Stockman NOT VOTING—14 make investments in unstable coun- DeLay Lewis (KY) Talent Diaz-Balart Lincoln Baker (LA) Furse Moakley tries like Russia, they have every right Tanner Doolittle Linder Camp Gunderson Reynolds in the world to do so. But they do not Tate Dornan LoBiondo Collins (MI) Jefferson Torricelli Tauzin have the right to obligate American Dreier Longley Cubin Lantos Williams Taylor (MS) taxpayers to underwrite the insurance Duncan Lucas Ford Mfume Taylor (NC) Ehrlich Luther for the possible loss of their private in- Emerson Manzullo Thomas b 1356 vestments. English Martini Thornberry Tiahrt Mrs. CHENOWETH changed her vote Currently, if these giant corporations Ensign McCollum make a lot of money, well, the good Ewing McHugh Torkildsen from ‘‘no’’ to ‘‘aye.’’ Fawell McInnis Traficant So the amendment was rejected. news is that the owners of those com- Fields (LA) McIntosh Upton The result of the vote was announced panies become a little bit richer. How- Fields (TX) McKeon Walker ever, if there is political turmoil in an Flanagan Metcalf Wamp as above recorded. Foley Meyers Watts (OK) AMENDMENT OFFERED BY MR. SANDERS unstable country, and these large com- Fowler Mica Weldon (FL) Mr. SANDERS. Mr. Chairman, I offer panies lose their assets as a result of Weldon (PA) Fox Miller (FL) an amendment, amendment No. 44. expropriation, or political turmoil, or Franks (NJ) Minge Weller civil war, guess what? It is Uncle Sam Frisa Molinari Whitfield The CHAIRMAN. The Clerk will des- Funderburk Montgomery Young (FL) ignate the amendment. and the American taxpayers who have Gallegly Moorhead Zeliff The text of the amendment is as fol- to bail out these companies. Ganske Myers Zimmer lows: Now, Mr. Chairman, OPIC does not make sense for two basic reasons. No. NOES—218 Amendment offered by Mr. SANDERS: Page 1, we do not have to subsidize the larg- Abercrombie Bunn Doyle 4, line 26, strike ‘‘$26,500,000’’ and insert Ackerman Callahan Dunn ‘‘$1,000,000’’. est corporations in America and stand Andrews Cardin Durbin Page 5, line 9, strike ‘‘$79,000,000’’ and in- a tremendous potential loss when we Archer Clay Edwards sert ‘‘$0’’. have a huge deficit. No. 2, from an eco- Bachus Clayton Ehlers nomic point of view, why in God’s Baesler Clement Engel b 1400 Baldacci Clyburn Eshoo name are we encouraging the largest Barrett (WI) Coleman Evans Mr. SANDERS. Mr. Chairman, as my corporations in America to invest Barton Collins (IL) Everett colleagues know, this country has a abroad rather than reinvesting in Bateman Conyers Farr Becerra Costello Fattah $4.7 trillion national debt, and this America and creating jobs? Beilenson Coyne Fazio body has passed a budget which makes What are the outrages of OPIC can be Bentsen Crapo Filner savage cuts in Medicare, Medicaid, stu- seen on the chart to my right. We are Berman Danner Flake dent loans, veterans programs, and providing incentives for corporations Bishop Davis Foglietta Boehlert de la Garza Forbes many other programs which mean a like Ford to invest abroad when Ford Boehner DeFazio Frank (MA) great deal to tens of millions of work- has laid off in the last 15 years over Bonilla DeLauro Franks (CT) ing Americans. Given that context, Mr. 150,000 American workers. We are pro- Bonior Dellums Frelinghuysen Borski Deutsch Frost Chairman, it seems to me long overdue viding incentives to GE to invest Boucher Dickey Gejdenson that the U.S. House of Representatives abroad when GE has laid off over Brewster Dicks Gephardt begins to stand up and take on the $100 180—— Brown (CA) Dingell Gibbons billion a year in corporate welfare The CHAIRMAN. The time of the Brown (FL) Dixon Gilchrest Brown (OH) Doggett Gonzalez which goes to the largest corporations gentleman from Vermont [Mr. SAND- Bryant (TX) Dooley Gordon in America and to the wealthiest peo- ERS] has expired. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6331

(By unanimous consent, Mr. SANDERS balance of payments. It creates a good cut unjustifiable welfare subsidies in was allowed to proceed for 1 additional competitive situation against Germany the welfare budget, as I have when I minute.) and Japan. voted with you on your welfare reform Mr. SANDERS. Mr. Chairman, let us Mr. Chairman, many Members of the bill, then look to the Sanders amend- eliminate OPIC for two reasons. The House really do not know what OPIC ment, and vote ‘‘yes.’’ If you think that largest, most profitable corporations in does, but what OPIC essentially does is it is a wrong-headed policy for the America do not need taxpayer incen- allow companies to buy insurance United States to subsidize a company tives, and we do not have to cover against political instabilities in other that will create jobs overseas, but not through insurance their risky invest- countries, and then this insurance create jobs in the United States, then ments. No. 2, what does it say to com- makes it possible for them to obtain vote for the Sanders amendment. panies in America who are reinvesting private financing. I say to my colleagues, You think here? That we are going to subsidize The final point that I would make, about this the next time you return to large corporations who take our jobs and we are going to be making these your district. If a company in your dis- abroad. points all day, but the final point that trict wanted a Federal loan guarantee It is time to eliminate OPIC. I urge I would make is that OPIC not only to make their factory bigger, or their support for this amendment. generates an enormous number of jobs store employ more people, or do re- Mr. CALLAHAN. Mr. Chairman, I in the United States, it not only gen- search and development, by and large rise in opposition to the amendment of- erates a positive balance of payments the answer would probably be ‘‘No, fered by the gentleman from Vermont for the United States, but most of all it they wouldn’t get that Federal loan [Mr. SANDERS]. returns money to the Treasury. It is guarantee,’’ but if they chose to set up The Overseas Private Investment one of the few agencies I know that has shop in Guatemala, or Malaysia, or Ar- Corporation is not perfect. It does have a positive impact on the Nation’s defi- gentina, or somewhere else outside of room for improvement. Perhaps part of cit. the United States, here comes OPIC that can be privatized. This matter will Mr. Chairman, since 1971 OPIC has driven and funded by the American be discussed in the amendments to be contributed $2 billion to deficit reduc- taxpayer to the rescue. If you think it offered later in the day by the gen- tion in the United States, and in 1996 is a bad industrial policy to subsidize tleman from Wisconsin [Mr. KLUG]. we expect OPIC to contribute $100 mil- the export of American capital and Mr. Chairman, the amendment before lion in addition to all of its other eco- American jobs, then vote for the Sand- us closes down the Overseas Private In- nomic contributions to our country ers amendment. vestment Corporation. In fact, it does and to our balance-of-payments ac- Finally, Mr. Chairman, to my not leave enough money to even close counts. friends’ concern about the foreign pol- it down. It cannot be done for $1 mil- Mr. ANDREWS. Mr. Chairman, I icy of our country, I say, If you think lion. Many former Socialist nations are move to strike the requisite number of it is bad foreign policy for an now looking to American investment words. unelected, unaccountable, private and building the infrastructure needed (Mr. ANDREWS asked and was given group of people to travel the world and for their own development. In the short permission to revise and extend his re- make policy decisions on behalf of the term much of that American invest- marks.) United States, if you agree with the ment will involve OPIC insurance of fi- Mr. ANDREWS. Mr. Chairman, I rise editors of the Wall Street Journal who nancing, and, as long as these coun- in strong support of the Sanders said that OPIC is really nothing more tries, such as India, do not have a amendment. than foreign policy conducted through track record of adherence to free mar- Mr. Chairman, I myself introduced a another way, foreign aid conducted ket principles, OPIC is needed. virtually identical amendment. I would through another way then support the Mr. Chairman, if we are going to like to talk about who I think ought to Sanders amendments. compete in a global economy, then our be for this amendment. Mr. Chairman, the majority is to be business people must compete with the First of all, let me say that I com- commended for making very difficult Governments of Japan and Germany mend my colleagues on the Republican and sometimes unpopular decisions to and all of the other industrialized na- side for making some very difficult and try to bring our budget into balance. It is entirely consistent with that tradi- tions because all of them have such an controversial stands in favor of reduc- tion that they support the Sanders agency to assist the export of our ing the Federal budget. I do not agree amendment. I am going to; I would American jobs overseas. This is the fin- with all that they have done, but I urge my colleagues on both sides of the est vehicle we have to do that, and I agree with the idea that they are ad- aisle to do so, too. dressing, in a very honest and aggres- think that it would be a very serious Mr. ROTH. Mr. Chairman, I move to sive way, the fact that we are spending mistake to do it especially in the way strike the requisite number of words. that the gentleman from Vermont pro- far more than we take in. I invite them Mr. Chairman, this amendment be- poses, and that is just to walk down- to continue that philosophy and con- fore us is a disaster for American ex- town, and give them a key, and tell tinue that tradition by voting for Mr. porters and, therefore, American jobs. them to lock the door, and do not even SANDERS’ amendment. This amendment reduces American ex- give them enough money to pay the The bill, as it presently is written, ports, it costs American jobs, it does rent for the rest of the month. calls for 79 million dollars’ worth of ap- great harm to our competitive position So I strongly oppose the amendment propriations for new loans, and new in the world and will destroy a valu- and urge my colleagues to support this guarantees and new goals for OPIC, and able tool for American exporters. bipartisan disagreement to the gen- it calls for, I believe, 29 million dollars’ tleman from Vermont’s amendment worth of operating money from the b 1415 and to vote ‘‘no’’ on this amendment. American taxpayer. Here is an oppor- I think the chairman of the commit- Mr. WILSON. Mr. Chairman, I move tunity, my colleagues, to say to du- tee and the ranking member have ex- to strike the last word. Pont, ‘‘Be a rugged individualist,’’ to plained it very precisely. This amend- Mr. Chairman, I probably will not say to CocaCola in an entrepreneurial ment simply denies OPIC the authority take the whole 5 minutes, but, if there society, ‘‘Make it on your own,’’ to say to function. It shuts down OPIC. has ever been a win, win, win situation to AT&T and GTE, ‘‘Take risks with Last week’s disastrous trade report in an institution in the United States, your own shareholders’ money, but not underscores the reason why the House it is the Overseas Private Investment with the taxpayers’ money of the Unit- should reject this amendment. In April Corporation. The Overseas Private In- ed States,’’ to American Express, of this year our overall trade deficit vestment Corporation generates an im- ‘‘Leave home without it, leave home was the worst in the 3 years, $11 bil- mense number of jobs in the United without the taxpayers’ money the next lion, and the deficit in goods was $16 States and the production of heavy time you want to make a deal some- billion. The reality is, our exports are generation equipment, of airplanes, of where overseas.’’ stalling. airplane engines, of all the rest. It not Mr. Chairman, I say to my col- If our exports do not grow, our econ- only creates jobs, it creates a positive leagues, If you will look, my friends, to omy will not grow, and probably will H 6332 CONGRESSIONAL RECORD — HOUSE June 27, 1995 slip into recession. Now, along comes A loss of American exports translates insurance can be provided, where there this amendment, which would further into a loss of American jobs. That is would be a negative effect on U.S. jobs. reduce our exports. This amendment is what we are fighting for here today. We Our companies do operate overseas. economic unilateral disarmament. Who are fighting for American jobs, because When they do it appropriately, they in this House wants to vote to cut ex- we are staring a recession in the face. create jobs here. Simply to say there ports, at the very time we are in dan- We have to have jobs for our people. will be no insurance available to them ger of slipping into a recession? You cut out OPIC, you cut out exports. is going to result in job loss in the OPIC essentially puts us in a position You cut out exports, you cut out jobs. United States. in the world markets where we can So let us fight for the American About 25 percent of the companies compete for jobs. OPIC provides two worker for a change. Let us do some- that now are insured by OPIC, as I un- services for American business they thing for the American worker. This derstand it, are small businesses. So I cannot get anywhere else: Long-term amendment makes absolutely no sense. do not think it is fair to simply take insurance against risk and financing So here is our choice. If we want to the big business label and simply to for trade and investment overseas. reduce American exports, if we want to throw it around and say, ‘‘This is a way Mr. WILSON. Mr. Chairman, will the kill jobs for American workers, and if to get at big business.’’ gentleman yield? we want to make America less com- Look, I do not like the downsizing, Mr. ROTH. I yield to the gentleman petitive in the world markets, then but the downsizing has nothing to do from Texas. vote for this amendment. with OPIC. I do not like the downsizing Mr. WILSON. Mr. Chairman, some of But if you want to increase exports— when it comes to job loss. But OPIC’s the other speakers have indicated that and let me just say, every indicator is insurance activities have nothing to do OPIC operates at a cost to the Amer- that we are facing a recession—if you with that downsizing. Indeed, what we ican taxpayers. Would the gentleman want to fight for American jobs, then need to do is to stimulate American agree that is not so? let us vote against this amendment. companies to compete with their over- Mr. ROTH. Mr. Chairman, reclaiming Mr. LEVIN. Mr. Chairman, I move to seas competitors. my time, I have looked at OPIC and strike the requisite number of words. Mr. SANDERS. Mr. Chairman, will read the law. There is not 1 red cent of Mr. Chairman, I, with some reluc- the gentleman yield? taxpayer money in OPIC. That is No. 1. Mr. LEVIN. I yield to the gentleman tance because of my deep respect for No. 2, what is this talk about sending from Vermont. the sponsor of the amendment, rise in jobs overseas? OPIC has written in law Mr. SANDERS. Mr. Chairman, it strong opposition to this amendment. that it cannot cost American jobs. seems to me if we are going to provide This will, in a word, lose jobs. It will That is part of the law. subsidies and incentives to corpora- Long-term financing is given so that not gain them. tions who are laying off hundreds and we can compete in international mar- I am in favor of eliminating unneces- hundreds, if not millions of workers, kets. OPIC exists because American sary subsidies to business. I think then at the very least, it would be ap- business cannot get this insurance and where the private sector can do it, it propriate to say stop laying off work- financing anywhere else. Over the past should be able to do it, and it should be ers here in the United States. To sim- 25 years, OPIC has directly supported left to do it. But I think we have to be ply give these people incentives to in- $40 billion in American exports, and careful how we apply it. I believe when vest abroad and then turn a blind eye that translates into 800,000 jobs. we talk about corporate welfare, and on their disastrous policies here in Let me repeat that again—$40 billion we need to look at it, we have to sepa- America is a real sell-out of American in American exports. Where do you rate the wheat from the chaff. We have workers. think our good-paying jobs are coming to look at business subsidies, but with Mr. LEVIN. Mr. Chairman, reclaim- from? They come when we send our some care, and not with simply a sword ing my time, let me say in response to products overseas. You stop selling our that cuts off some assistance where it my distinguished colleague from Ver- products overseas, and you are not is necessary. mont, if that is what the facts were, I going to have jobs in New Hampshire, Where does the purpose of OPIC lie? would favor the Sanders amendment. and Dallas, TX, or Green Bay, WI, or What does it do? Mainly it insures. And The trouble is, those are not the facts. San Francisco. You are only going to what does it insure against? Expropria- The facts are that the OPIC efforts have more good-paying jobs when you tion, currency problems, political vio- have nothing to do with the downsizing have more exports. lence. You cannot go to the private in this country, and in fact, there is a OPIC is the best managed Federal sector and get that kind of insurance. provision that will not allow insurance. agency. OPIC has never lost 1 cent. Period. The purpose of OPIC is not ba- The CHAIRMAN. The time of the OPIC has paid back to the Treasury sically to give money to corporations gentleman from Michigan [Mr. LEVIN] every dollar; yes, my good friend from to go overseas to do research and devel- has expired. Ohio, every dollar it initially had to opment. (By unanimous consent, Mr. LEVIN capitalize. So there is no taxpayer That is not its basic purpose. It was was allowed to proceed for 2 additional money, not 1 red cent. founded to provide insurance so that minutes.) Look at me. Am I blue in my face? American companies could compete Mr. LEVIN. Mr. Chairman, there is a There is not 1 red cent of taxpayer with companies of other countries and provision that if the insurance would money involved in OPIC. Every year be insured against contingencies where cause job loss, it will not be provided. OPIC makes money for the Treasury. they could not cover those problems Now, look, everybody knows that Do you know how much it made last themselves. some activities of companies overseas year alone? It made $167 million. OPIC Now, let me just say a word about generate jobs in the United States. actually helps cut the Federal deficit. what other countries are doing. They That is simply a fact. When we, for ex- It has contributed $2 billion—yes, my are providing this kind of insurance. ample, insure an activity, a powerplant friend from Texas, $2 billion to the U.S. Our competitors do that. So if you activity in another nation for a U.S. Treasury. It has helped to reduce the eliminate OPIC, what you are simply company, that can create jobs in the deficit. If you shut down OPIC, we will saying to the companies of the United United States, because it is likely that not have this money to help reduce the States who are trying to do some ex- the equipment used by that power com- deficit. And where will U.S. exporters porting, trying to operate overseas, not pany will come from the United States. obtain the long-term financing nec- to take jobs away from this country, So I think what you have to use here essary to establish a presence in for- but to help to create them here, is that when it comes to corporate welfare is eign markets? The answer is, without they will not have the same kind of fa- some objectiveness, some understand- OPIC, you will not. cility as is available to companies from ing of the facts. You have to sometimes If this amendment would become law, other countries. use a scalpel and not a meat ax here, our exporters will suffer, particularly Now, let me say a word about job and I think this is essentially a meat in the emerging markets of Latin loss. Look, let us not confuse the issue. ax proposal. America, Asia, and parts of Africa, OPIC specifically provides, the statute Mr. Chairman, in conclusion, I think where OPIC insurance is so essential. does, that no money can be given, no this is not a wise amendment. I think June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6333 we have to protect American jobs, safe- Mr. GEJDENSON. Mr. Chairman, will fundamental aspects of what insurance guard them in this country. I think we the gentleman yield? underwriting is all about. have to be sure that our policies stimu- Mr. LEVIN. I yield to the gentleman If there are and when there are late growth of jobs in this country, and from Connecticut. claims against that amount, it could be that is what OPIC’s mission is. And Mr. GEJDENSON. Mr. Chairman, my wiped out very, very quickly. It hap- while it has made some mistakes, it understanding is not only is OPIC not a pens that OPIC has done a very good has done more good than it has done drain on the taxpayers, it has a return job which, frankly, is a very powerful harm. So get at the problem, do not to the taxpayers every year. Estimates argument in favor of privatization. take this sword and cut American busi- are as much as $2 billion has been The reason that I am opposed to the ness and American workers, at the brought to the Treasury since 1971. Sanders amendment is because it truly knees in many cases. So in effect what you are saying is does not offer an opportunity to pri- Mr. KASICH. Mr. Chairman, will the we have two challenges on the floor to vatize. It immediately shuts every- gentleman yield? the Overseas Private Investment Cor- thing down in a way that will make it Mr. LEVIN. I yield to the gentleman poration today. One says we are angry impossible to in a thoughtful and or- from Ohio. at business, so we want to hit anything derly and regular way actually get to a Mr. KASICH. Mr. Chairman, I just that helps them. The problem with privatization. want to take a second to say that the that approach is the layoffs will be Mr. SANDERS. Mr. Chairman, will gentleman from Michigan [Mr. LEVIN] greater if we do not have OPIC to help the gentleman yield? and the previous speaker made a num- facilitate sales overseas. Mr. HOKE. I yield to the gentleman ber of comments that I disagree with, The CHAIRMAN. The time of the from Vermont. and they made some that I agree with. gentleman from Michigan [Mr. LEVIN] Mr. SANDERS. Mr. Chairman, the My problem with the Sanders amend- has expired. gentleman from Ohio [Mr. HOKE] ment is it goes too far too fast from (By unanimous consent, Mr. LEVIN makes a very important point, and I the standpoint of what my and the was allowed to proceed for 1 additional hope the Members are listening. We amendment of the gentleman from minute.) have heard some Members say, this Wisconsin [Mr. KLUG] has, which is to Mr. LEVIN. Mr. Chairman, I continue adds $2 billion to the Treasury. It is privatize the operation of this corpora- to yield to the gentleman from Con- used for deficit reduction, et cetera, et tion. If we were to adopt the Sanders necticut. cetera. Wrong. It is an insurance fund. Mr. GEJDENSON. Mr. Chairman, the amendment, we would have great dif- If my memory is correct, we have other challenge says the private sector ficulty. some $6.3 billion in liabilities out The CHAIRMAN. The time of the can do it better. There is no dem- there. In point of fact, if we kill OPIC, gentleman from Michigan [Mr. LEVIN] onstration of that anywhere that I then we would have $2 billion to use for has expired. have seen. I do not know where you re- deficit reduction. Right now, as the (By unanimous consent, Mr. LEVIN place the $140 million, $100 million a gentleman from Ohio [Mr. HOKE] indi- was allowed to proceed for 2 additional year that comes to the Treasury, and cates, this is an insurance fund. minutes.) where you can get the kind of guaran- Mr. HOKE. Mr. Chairman, reclaiming Mr. LEVIN. Mr. Chairman, I yield to tee that the Federal Government my time, if we kill OPIC, I do not agree the gentleman from Ohio. brings in with its intelligence re- that we would have that money for def- Mr. KASICH. So what I would argue, sources and other resources to make icit reduction because I do not think Mr. Chairman, is that we should resist sure that American companies can stay that we can simply abrogate the liabil- the Sanders amendment and then competitive overseas. ities of the U.S. Government by writ- quickly pivot and adopt the Klug Mr. LEVIN. Mr. Chairman, reclaim- ing them off in a new agreement. At amendment, which the chairman of the ing my time, let me just say to the least, even if we can do that by law, it subcommittee has agreement with. gentleman from Connecticut, I very is something that I do not think that That would do several things. It would much agree with that, and let me just this Congress is going to do because we bring the appropriation more in line close: Look, I think we need to get at have made commitments in that area. with the game plan spelled out within subsidies that are unwise. I think we our budget resolution, and would pre- need to look after the taxpayers’ needs. Mr. WILSON. Mr. Chairman, will the vent the transfer of funds from the in- This is a shortsighted way to do it. gentleman yield? surance fund into the investment fund, Mr. HOKE. I yield to the gentleman b all of which will serve in a short period 1430 from Texas. of time to privatize the operation of OPIC has been insuring activity that Mr. WILSON. Mr. Chairman, I think OPIC. is creative of American jobs, not de- the gentleman and I have got conflict- We may have a debate down the road structive. I urge defeat of this amend- ing information that we both believe is as to whether the gentleman from ment. true. But I believe that the OPIC has Michigan [Mr. LEVIN] will support that. Mr. HOKE. Mr. Chairman, I move to steadily contributed to, has returned I happen to believe it is not something strike the requisite number of words. money to the treasury in addition to that should continue to be directly Mr. Chairman, I rise in opposition to maintaining its $2.4 billion reserve. We supported by taxpayers, and can in fact this amendment and will be speaking need to clear that up. be a viable entity in the private sector. on behalf of the Klug amendment that Mr. HOKE. That is my understand- So I would urge opposition to the the gentleman from Wisconsin [Mr. ing, Mr. Chairman. Sanders amendment, but then quick KLUG] and I are going to bring after Reclaiming my time, Mr. Chairman, support in favor of the Klug amend- this. But I want to correct one thing and to finish up, I think that the rea- ment that will take this out of the before I speak in opposition. That is, son that we do not want to go in this hands of the Government, privatize it, we hear repeatedly that OPIC has actu- direction where we are going to shut it and make it an efficient operation, not ally brought money to the Treasury down is it will make it impossible to do directly funded by the taxpayers of the over the past couple of decades that it what we need to do, which is essen- country. has been in business. While in one tially make it possible to privatize the Mr. LEVIN. Mr. Chairman, reclaim- sense there is some truth to that, I whole operation. I think we can do ing my time, let me just say quickly in think that by saying that it is generat- that. response, if we can privatize a function ing income is misleading. It really Clearly, the insurance end of it is effectively, let us do it. But you, I ought to be corrected. making money. I think that the credit think, will have the burden of showing, What it has done is it has generated side of it is much more problematic, the burden of proof, that this indeed reserves against possible potential in- and it may not be able to be privatized. can be done by the private sector, the surance claims, as any insurance com- And frankly, it may not be worth going insurance against political turmoil, pany does. To say that that is income forward with. I am not sure that that is currency problems, and also expropria- to the Treasury and has helped offset good use of taxpayer funds on the cred- tion. the deficit is essentially to mislead the it side. H 6334 CONGRESSIONAL RECORD — HOUSE June 27, 1995 I think most people do not under- treasury and made jobs for our coun- Mr. LEVIN. Let me say to the gen- stand that there are two different ac- try. It would be counterproductive, tleman from Vermont, just take an- counts. There is the credit account with all the anger that we share other look at this. We are now over in that guarantees the loans and then against people being unemployed, to Geneva trying to force open the mar- there is the insurance account that in- hurt this program because it means kets of Japan. sures against losses due to politics or more people would be unemployed. The CHAIRMAN. The time of the currency fluctuation, et cetera. I would hope we defeat this amend- gentleman from Connecticut [Mr. Mr. WILSON. Mr. Chairman, if the ment. It is a bad amendment. It would GEJDENSON] has expired. gentleman will continue to yield, I hurt the workers of this country. (On request of Mr. LEVIN, and by think you will find, and you probably Mr. SANDERS. Mr. Chairman, will unanimous consent, Mr. GEJDENSON do not disagree and it does not conflict the gentleman yield? was allowed to proceed for 2 additional Mr. GEJDENSON. I yield to the gen- with anything you said, but it is the in- minutes.) surance side that turns the big profit tleman from Vermont. Mr. SANDERS. Mr. Chairman, we Mr. LEVIN. Mr. Chairman, if the gen- because there is no competition out tleman will continue to yield, we are there. They can charge whatever they talk about job creation. Where is your information about how many jobs have trying to get the Japanese to open think that the traffic will bear and their markets for American cars and that is the reason they are able to re- been created? Second of all, the gentleman from American parts. We are spending a lot turn money. of time and some resources doing that. Mr. HOKE. Mr. Chairman, to sum up, Wisconsin previously talked about ex- I rise in opposition to the Sanders ports. Nobody in this House believes The beneficiaries, if you want to call amendment. more than I do that we have got to re- it that, will be Ford, GM, Chrysler, Mr. GEJDENSON. Mr. Chairman, I build our manufacturing base, create they are big companies, Allied Signal, move to strike the requisite number of decent-paying jobs and exports. That is TRW, and a lot of other parts compa- words, and I rise in opposition to the not what we are talking about here. nies, which would be able to build parts amendment. In fact, what we are talking about here in the United States and ship Mr. Chairman, I think it is interest- here is helping the largest corporations them to Japan. It simply is incorrect ing what we have confronted here. in America who have thrown hundreds to say because a company is large, as it OPIC is under attack because it has of thousands of American workers out would be, because a company is small, been successful. It has done a good job, on the street, set up factories abroad. they should not do business overseas. and it has helped exports. It has pro- The jobs that are going to be created And what OPIC does, basically, is to in- tected the American economy, pro- are over 90 percent abroad. sure companies. And we do not need tected American workers, and, yes, it Mr. GEJDENSON. Reclaiming my this as to Japan. We need it other has helped American business. They time, Mr. Chairman, I do not agree places, against currency difficulties, are all in the same boat. We are all in with those statistics. I would say that against political violence, and turmoil the same boat. what we have seen across the board is and expropriation. To the Sanders amendment, I have to that every billion dollars of exports Mr. GEJDENSON. Reclaiming my say that without these tools, frankly, means about 20,000 American jobs. And time, Mr. Chairman, to continue on the more of the people that we are con- when you look at the OPIC guarantees, gentleman’s analogy, you would then cerned about, the workers, would be inevitably 70 and 80 percent of the have to argue that trying to open the being laid off. So if you take away the product in those plants that make markets in Japan are helping these big guarantees and they cannot sell the those plants operate are American- companies that downsize. That is not products that we make to a lot of these made products, in some cases as high correct. markets, when they are unstable, we as 90 percent. Mr. LEVIN. The opposite is true, Mr. are not going to be in there when these Mr. ROTH. Mr. Chairman, will the Chairman, if the gentleman will con- countries stabilize. The Germans, the gentleman yield? tinue to yield. We want to open up the French, the Japanese will have locked Mr. GEJDENSON. I yield to the gen- Japanese market so that the up these markets, and we will be back tleman from Wisconsin. downsizing in the auto industry will on this floor in 5 or 6 years wringing Mr. ROTH. Mr. Chairman, to answer stop and they can continue to begin to our hands about a larger trade deficit the question how many jobs OPIC cre- hire more people. and more layoffs and more downsizing. ated, I can answer that for the gen- Mr. SANDERS. Mr. Chairman, will It is without question against Ameri- tleman: $40 billion have been sold over- the gentleman yield? seas because of OPIC. You had men- ca’s best interests to do damage to Mr. GEJDENSON. I yield to the gen- tioned 20,000 jobs for every billion sold OPIC. This is the Overseas Private In- tleman from Vermont. vestment Corporation. It is not the one overseas, that means 800,000 jobs have Mr. SANDERS. Mr. Chairman, it that dealt with the oil monopolies. been created because of OPIC. There is seems to me that we are missing a fun- This one helps us. The other one hurt your answer. damental point here. To talk about us. It helps workers, and we ought to The other point is, some people say opening up Japan for American prod- protect those workers. that we are going to send some jobs How does it help us? When American overseas. Look who is on the board of ucts is something that we all agree on. products are made and we are entering directors of OPIC, the president of the That means products are being manu- markets that are just developing, there International Association of Machin- factured in the United States, employ- are oftentimes a number of challenges: ists and Aerospace Workers. Do you ing American workers and sold in stability in the regime; stability in the think he would be on the board sending Japan. That is what we want. That is currency. Corporations, large ones and jobs overseas? not what OPIC is about. OPIC is giving small ones alike, may not be able to, Mr. GEJDENSON. Mr. Chairman, re- the largest, most profitable corpora- first, assess the danger and, second, claiming my time, what the gentleman tions in America help in setting up fac- take all that risk in a product being from Wisconsin has just listed is the tories abroad. moved into that country. The Govern- head of the machinists union, as I un- The CHAIRMAN. The time of the ment guarantee helps us access those derstand it, is a member of the OPIC gentleman from Connecticut [Mr. markets. board and making these decisions. The GEJDENSON] has again expired. As those markets mature and become gentlemen from Wisconsin and I joined (On request of Mr. LEVIN, and by stable, once we are the ones that have together with language several years unanimous consent, Mr. GEJDENSON established the generating system, we ago to make sure that there was vir- was allowed to proceed for 1 additional are going to get the replacement parts. tually no chance that we would do a minute.) We are going to get the new orders net harm to the United States. Mr. LEVIN. Mr. Chairman, if the gen- more likely, when there is a mature Mr. LEVIN. Mr. Chairman, will the tleman will continue to yield, if that and stable market. gentleman yield? were the history of OPIC, I would be in This program has made money for Mr. GEJDENSON. I yield to the gen- favor of its destruction. It simply is the taxpayers, made money for the tleman from Michigan. not true. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6335 Mr. GEJDENSON. Reclaiming my not know why he has said it, but he has cause it negotiates on a government- time, Mr. Chairman, I believe that it said several times that OPIC gives sub- to-government basis. Its services are would be impossible to have the head of sidies loans and is subsidizing Amer- simply not available in the private sec- the machinists union on an organiza- ican corporations. Is the gentleman tor. OPIC does not cost the taxpayers tion that was moving jobs out of the aware that OPIC only makes loans at anything. It actually makes money for country. The president of the machin- market rates? the Government, so its elimination ists union is on this board particularly Mr. SANDERS. Mr. Chairman, if would actually increase the deficit, not for that reason, to make sure that we OPIC makes loans at market rates, reduce it. protect American jobs. why do not companies go to the private Mr. Chairman, in my opinion, OPIC Mr. SANDERS. Mr. Chairman, I ask market and get those loans? is a model example of how a Federal unanimous consent to strike the req- Mr. WILSON. They do not go to the agency should run. I oppose the Sand- uisite number of words. private market to get the loans, Mr. ers amendment. Mr. Chairman, I ask The CHAIRMAN. Without objection, Chairman, because the loans do not for support for the committee’s posi- the gentleman from Vermont [Mr. bear the same significance as loans tion. SANDERS] is recognized for 5 minutes. guaranteed by the Government of the Mr. CALLAHAN. Mr. Chairman, will There was no objection. United States, because it is impossible the gentleman yield? Mr. SANDERS. Mr. Chairman, the to get private financing against politi- Mr. CHRISTENSEN. I yield to the issue here is whether or not cal instability. gentleman from Alabama. multibillion-dollar corporations, Mars Mr. SANDERS. Mr. Chairman, I Mr. CALLAHAN. Mr. Chairman, the Candy comes to mind, why Mars should think that in a free market so- gentleman is absolutely right. The gen- Candy? Because that family, the Mars ciety, there would be some insurance tleman from Vermont is looking at the family, is one of the very wealthiest companies that would love to be charg- Mars Candy Bar Co. I do not know families in America. Why do these peo- ing a high premium. what he is talking about. Why does he ple need subsidies and incentives to Reclaming my time, Mr. Chairman, not look at some of the positive as- start factories and plants in other over and over again what I am hearing pects of what OPIC is doing. Look at countries? from my Republican friends is, Get the some of the generation plants that Some of my friends here have said, Government out of this, get the Gov- they are building. Large American this is a job creator. The way you cre- ernment out of that. The private sector companies, true. However, look at the ate jobs is to build plants and factories does such a great job. fact that they are building power in the United States, manufacture and I am hard pressed to believe that a plants, that they are building infra- sell them abroad. large insurance company could not pro- structure in countries that they would Some people say, well, it really does vide insurance for some of these com- not be able to be in without the guar- not matter, that we are encouraging panies to invest in Russia and make antee of OPIC. Who would be there? companies to start factories abroad. I respectfully disagree. A company some money. If it is such a good deal, The Japanese would be there. looks at the bottom line and it says, I let the private sector do it, and not the Do Members guess the Japanese have got $1 billion here. Do I build in taxpayers of America. would insist we buy General Electric Mr. CHRISTENSEN. Mr. Chairman, I Detroit, MI or in Burlington, VT? Or do generators? No, they would buy their move to strike the requisite number of I go to Russia? And then they say, is it generators from Japan. Do we guess words. not nice, I cannot get Government sub- then that people who bought the Japa- Mr. Chairman, the gentleman’s char- sidies to build in Detroit or Burlington, nese generator might need American acterization of OPIC is not correct. VT but I can get help to go to Russia parts to repair them? No. They would Also, this is a bipartisan support. The or to Latin America? go to Japan. committee on both sides, Republicans Let me tell the gentleman, he is ab- b 1445 and Democrats, supported this bill. solutely right. This is a way we can Mr. Chairman, I have heard a whole The Overseas Private Investment compete. The example of the Mars lot about the beauties of the market Corporation, or more commonly known Candy Bar Co. to me makes no logic system and the free enterprise system. as OPIC, is a good thing for the coun- whatsoever, because the gentleman is If it is such a good system, then why do try and a good thing for the American talking about a small tip of the dog’s the largest corporations in this coun- people. Mr. Chairman, I support tail, when he should be talking about try need taxpayer subsidies in order for downsizing Government more than the fact that this is the only vehicle them to go out and make money? anyone. However, abolishing OPIC will that American business people have to Right now one of the scandals facing not further either of these goals. compete internationally with the other this country, in my view, is that Amer- OPIC is not some big Government G–7 nations, so the gentleman is abso- ican corporations, while they are lay- subsidy program, as some have lutely right, we should reject the gen- ing off hundreds of thousands of work- charged. It provides loans and political tleman’s amendment. ers a year here, are investing $750 bil- risk insurance, as we just heard, to Mr. CHRISTENSEN. I thank the lion a year abroad. They do not need to American companies doing business chairman for his leadership on this help abroad. They are doing it just abroad. It does not do this for free. As issue. Reclaiming my time, that is ex- fine. Ask the workers in the UAW who Members heard, it charges market actly the point. That is exactly what have lot their jobs when companies, rates. has happened with the people that I automobile companies, are set up in Let me tell the Members about a know of who have worked with OPIC in Mexico. company that I know of personally the past. Mr. Chairman, if these programs are that has worked with OPIC. It recently Mr. VOLKMER. Mr. Chairman, I so good, let the private sector under- got charged 11.9 percent for a financing move to strike the requisite number of take the insurance. Let the multi- rate, 11.9 percent to construct a power- words. nationals go to private banks to get plant in the Philippines. If it was not Mr. Chairman, I have been listening below-market financing. This Congress for OPIC, that company would have to the debate on this amendment, and has voted to cut back on Medicare, stu- purchased 500 million dollars’ worth of am very concerned about the fact that dent loans, veterans programs. We goods in the Japanese market. what I hear is that this is a program should not be providing subsidies and Like most every other Federal agen- that really benefits all of us here in incentives to the largest corporations cy, OPIC actually takes in more than America, but it is really to the benefit in America. it spends. As we have heard this year, of the major corporations of America. Mr. WILSON. Mr. Chairman, will the this past year, it made over $167 mil- Again, it is like the old trickle-down: gentleman yield? lion. At the end of each year it writes We are going to be benefited when Mr. SANDERS. I yield to the gen- a check back to the Federal Govern- somebody builds a power plant some- tleman from Texas. ment. Since 1971, it has contributed where else and uses American goods. Mr. WILSON. Mr. Chairman, the gen- back $2 billion to the Federal Govern- That is true, we all benefit when tleman has said several times, and I do ment. OPIC is a successful entity be- those jobs are created. However, what H 6336 CONGRESSIONAL RECORD — HOUSE June 27, 1995 if the people that bought that power little money and do away with elevator NOES—329 plant do not pay for it? Then the tax- operators, we have to do away with ele- Ackerman Filner Martini payers have to pay for it. vator operators, but we can keep this Archer Flake Mascara Mr. LEVIN. Mr. Chairman, will the corporate welfare around. Who benefits Armey Flanagan Matsui Bachus Foglietta McCarthy gentleman yield? from it? Baesler Foley McCollum Mr. VOLKMER. I yield to the gen- Mr. Chairman, I want to let the peo- Baker (CA) Forbes McCrery tleman from Michigan. ple out there know that DuPont got a Baker (LA) Fowler McDade Mr. LEVIN. Mr. Chairman, the insur- Baldacci Frank (MA) McDermott $200 million loan guarantee, and that Ballenger Franks (CT) McHugh ance is not an insurance against the CitiBank got a $113 million loan guar- Barr Frelinghuysen McIntosh loss of an investment because it was antee. How about a little Coca-Cola? Barrett (NE) Frisa McKeon unprofitable. Bartlett Frost Meek Little bitty old Coca-Cola, a little Barton Gallegly Menendez Mr. VOLKMER. I did not say unprof- bitty company, they do not have any Bass Ganske Metcalf itable. money at all. They got a loan guaran- Bateman Gejdenson Meyers Mr. LEVIN. It is insurance against tee of $165 million. Bentsen Gekas Miller (FL) expropriation, against political tur- Bereuter Gephardt Mineta What is going on in this world? We Berman Geren Molinari moil, like a revolution, or because of are cutting back, we are going to cut Bevill Gibbons Mollohan currency problems, so no one could back on the increase that people need Bilbray Gilchrest Moorhead Bilirakis Gillmor Moran bring back their money to the United out there for food stamps, for school States. It is not an insurance to guar- Bishop Gilman Morella lunches, for Medicare, for Medicaid, Bliley Gonzalez Murtha antee a profit. but we cannot cut back on all of these Blute Goodlatte Myers Mr. VOLKMER. I did not say it was Boehlert Goodling Myrick loan guarantees for these huge major guaranteeing a profit. Mr. Chairman, I Boehner Gordon Neal corporations. We cannot do that, Mr. am saying basically it is a guarantee Bonilla Goss Nethercutt Chairman. There is something wrong, I Bono Graham Ney that we are going to receive our return think, with this Congress, with our pri- Borski Green Norwood for the investments. Boucher Gutknecht Nussle orities. Mr. LEVIN. Mr. Chairman, if the gen- Brewster Hall (OH) Oberstar Browder Hall (TX) Obey tleman will continue to yield, it is not. I think it is time that we tell cor- porate America that they are no better Brown (FL) Hamilton Olver Mr. VOLKMER. In a way, it is. Brown (OH) Hansen Ortiz Mr. ANDREWS. Mr. Chairman, will off than individual citizens of this Brownback Harman Orton the gentleman yield? country, and just because they have a Bryant (TN) Hastert Oxley whole bunch of money to lobby down Bryant (TX) Hastings (FL) Packard Mr. VOLKMER. I yield to the gen- Bunn Hastings (WA) Pastor tleman from New Jersey. here and pay off people and get good Bunning Hayes Paxon Mr. ANDREWS. Mr. Chairman, I benefits for their type of activity, it is Burr Hayworth Payne (NJ) want to agree with the gentleman, that time we told them no. I think it is time Burton Hefley Pelosi that we told corporate America that Buyer Hefner Peterson (FL) OPIC does in fact do loan guarantees, Callahan Heineman Peterson (MN) not just insurance. It gives loan guar- they, too, can survive under the Repub- Calvert Herger Petri antees. It says if the enterprise located lican budget, and they do not need this Cardin Hilleary Pickett kind of welfare. Castle Hobson Pombo in a foreign country does not pay its Chambliss Hoke Pomeroy loan back, the American taxpayer does. The CHAIRMAN. The question is on Chapman Horn Porter The other point in the gentleman’s the amendment offered by the gen- Christensen Houghton Portman tleman from Vermont [Mr. SANDERS]. Clay Hoyer Pryce statement, I am sure in Missouri there Clayton Hunter Quillen are a number of communities that The question was taken; and the Clement Hutchinson Quinn would like to build power plants, sewer Chairman announced that the noes ap- Clinger Hyde Radanovich plants, and factories, as well. peared to have it. Clyburn Inglis Rahall Coburn Istook Ramstad Mr. VOLKMER. Reclaiming my time, RECORDED VOTE Coleman Jackson-Lee Rangel Mr. Chairman, I have all kinds of cities Collins (GA) Jacobs Reed Mr. SANDERS. Mr. Chairman, I de- that would like to build an industrial Collins (IL) Johnson (CT) Regula mand a recorded vote. tract in order to entice industry to Combest Johnson (SD) Richardson A recorded vote was ordered. Cooley Johnson, E. B. Riggs come in, and does the gentleman know Cox Johnson, Sam Rivers how much help those Missouri commu- The vote was taken by electronic de- Coyne Johnston Roberts nities would get from OPIC? vice, and there were—ayes 90, noes 329, Cramer Jones Roemer not voting 15, as follows: Cremeans Kasich Rogers They would not get any. Cubin Kelly Ros-Lehtinen Mr. ANDREWS. Nothing, because it [Roll No. 421] Cunningham Kennedy (MA) Rose Danner Kennelly Roth is not part of OPIC’s charter. AYES—90 Mr. VOLKMER. Mr. Chairman, it is Davis Kildee Roukema Abercrombie Hancock Rohrabacher de la Garza Kim Roybal-Allard basically to create jobs here, but basi- Allard Hinchey Royce Deal King Sabo cally the work goes elsewhere. What Andrews Hoekstra Rush DeLauro Kleczka Sawyer really bothers me, Mr. Chairman, is Barcia Holden Salmon DeLay Klink Saxton Barrett (WI) Hostettler Sanders Deutsch Klug Schaefer when I see the types of companies, Becerra Kanjorski Sanford Diaz-Balart Knollenberg Schiff many of which are huge conglomerates, Beilenson Kaptur Scarborough Dickey Kolbe Schroeder worldwide companies, that have bil- Bonior Kennedy (RI) Seastrand Dicks LaFalce Schumer lions of dollars, and yet we have to Brown (CA) Kingston Sensenbrenner Dingell LaHood Scott Canady Lewis (GA) Serrano Dixon Largent Shaw guarantee a loan for them. Chabot Lipinski Shadegg Doggett Latham Shuster DuPont? I have to guarantee a loan Chenoweth LoBiondo Shays Dooley LaTourette Sisisky for DuPont? Come on, Mr. Chairman. Chrysler Luther Smith (MI) Doolittle Laughlin Skaggs Coble Martinez Souder Dornan Lazio Skeen Why would I have to guarantee a loan Condit McHale Spence Doyle Leach Skelton for DuPont? Why do I have to guaran- Conyers McInnis Stark Dreier Levin Slaughter tee a loan for CitiBank? I think they Costello McKinney Stearns Dunn Lewis (CA) Smith (NJ) have enough of their own money. They Crane McNulty Stump Durbin Lewis (KY) Smith (TX) Crapo Meehan Stupak Edwards Lightfoot Smith (WA) have whole bunches of money. Why DeFazio Mica Taylor (MS) Ehlers Lincoln Solomon would I have to guarantee a loan for Dellums Miller (CA) Taylor (NC) Ehrlich Linder Spratt CitiBank? That is what this does. Duncan Minge Towns Emerson Livingston Stenholm Ensign Mink Traficant Engel Lofgren Stockman This is what I call, if we talk about Evans Montgomery Tucker English Longley Stokes corporate welfare, and what really in- Fattah Nadler Velazquez Eshoo Lowey Studds terests me is listening to the gen- Fields (LA) Neumann Volkmer Everett Lucas Talent tleman from Nebraska speaking in the Fox Owens Wamp Ewing Maloney Tanner Franks (NJ) Pallone Watt (NC) Fawell Manton Tate well before me. If I remember, he is the Funderburk Parker Woolsey Fazio Manzullo Tauzin same one who says we have to save a Greenwood Poshard Zimmer Fields (TX) Markey Tejeda June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6337 Thomas Waldholtz Wicker against losses of U.S. companies who tially depleted, guess what? We sud- Thompson Walker Williams invest overseas in politically risky en- denly cannot privatize it. Thornberry Walsh Wilson Thornton Ward Wise vironments. Our amendment will reduce the fund- Thurman Waters Wolf We have to ask ourselves why it is ing levels from $79 million down to $60 Tiahrt Watts (OK) Wyden that the Federal Government in this Torkildsen Waxman million, consistent with the Commit- Wynn day and age is in the business of essen- tee on the Budget’s recommendation Torres Weldon (FL) Yates Upton Weldon (PA) tially offering public insurance against Young (AK) and, second, rope off the reserve funds Vento Weller Young (FL) private risk? now approaching $2 billion to guaran- Visclosky White Zeliff And OPIC has grown dramatically Vucanovich Whitfield tee in the future that those funds will over the last several years where now be available so that when we follow NOT VOTING—15 U.S. taxpayers face a potential liabil- through on the authorizing commit- Camp Gunderson Mfume ity of nearly $800 million and is is not tee’s language moving toward privat- Collins (MI) Gutierrez Moakley going to be terribly far off before we Farr Hilliard Payne (VA) ization, an authority now granted to Ford Jefferson Reynolds have a liability approaching a billion the President to begin privatizing some Furse Lantos Torricelli dollars? of OPICs functions, that that $2 billion Mr. Chairman, I have absolutely no b 1515 in insurance funds, the most valuable objections whatsoever to keeping OPIC component in OPIC’s treasury, the Messrs. PICKETT, PAXON, and in place to help do low-interest loans most valuable asset in its portfolio, MANZULLO, Ms. MOLINARI, and Ms. which do return more money to the will be available as an attractive com- ROS-LEHTINEN changed their vote Treasury than they actually cost. It is ponent in a move by the U.S. Govern- from ‘‘aye’’ to ‘‘no.’’ an operation that stands in and of it- ment to privatize OPIC’s insurance Messrs. HANCOCK, MCHALE, self. function. HINCHEY, and TUCKER changed their But there is absolutely no reason for Mr. LUTHER. Mr. Chairman, I offer my sup- vote from ‘‘no’’ to ‘‘aye.’’ the Federal Government to be involved port for the Klug-Hoke amendment to H.R. So the amendment was rejected. in essentially guaranteeing high-risk 1868, allowing for the privatization of the The result of the vote was announced political decisions by U.S. corpora- Overseas Private Investment Corporation as above recorded. tions. [OPIC]. AMENDMENT OFFERED BY MR. KLUG My colleagues can look around and Mr. Chairman, I believe we should provide see all the other kinds of components Mr. KLUG. Mr. Chairman, I offer an appropriate assistance to promote and encour- of high-risk ventures one can do. A amendment. age U.S. exports. Exports increase American high-risk auto insurance driver can The CHAIRMAN. The Clerk will des- jobs at home and help encourage developing only go to the private sector to get in- ignate the amendment. countries to move toward free-market econo- surance. If you play in a charity golf The text of the amendment is as fol- mies. lows: tournament where a car is offered on a hole, insurance is available to guaran- However, I question whether we can afford Amendment offered by Mr. KLUG: Page 5, to spend taxpayer dollars to provide below- line 9, strike ‘‘$79,000,000’’ and insert tee that the auto company does not ‘‘$60,629,334’’. have to pay the cost. Insurance is market subsidies to major multinational cor- Page 5, beginning on line 10 strike ‘‘, to be available to protect the charity spon- porations while we try to tackle an incredible derived by transfer from the Overseas Pri- sor. Federal deficit and national debt. vate Investment Corporation Noncredit Ac- Why is it that the Federal Govern- With the dual goals of balancing the Federal count’’. ment is involved in guaranteeing for- budget while maintaining our strong presence Mr. CALLAHAN. Mr. Chairman, I ask eign investments if they decide to put and assistance in the developing world, the unanimous consent that all debate on U.S. operations or to sell U.S. products Klug-Hoke amendment makes common sense. this amendment, and all amendments in a very risky political environment? It enables OPIC to become self-supporting thereto, close in 15 minutes and that One of the great ironies I think is the within 3 years. It provides for export promotion the time be equally divided. fact that for example Ameritech re- as well as fiscal responsibility. I therefore en- The CHAIRMAN. Is there objection ceived $200 million in political risk in- courage my colleagues to support this amend- to the request of the gentleman from surance to provide Hungary’s long-dis- ment. Alabama? tance telecommunications system. Yet AMENDMENT OFFERED BY MR. CALLAHAN AS A Mr. DOGGETT. Mr. Chairman, I ob- we have a fight over whether OPIC SUBSTITUTE FOR THE AMENDMENT OFFERED ject; there has been so much misin- should be privatized, but we will loan BY MR. KLUG formation on this whole subject. And I money to help U.S. companies to com- Mr. CALLAHAN. Mr. Chairman, I fully and fairly object. pete overseas. offer an amendment as a substitute for The CHAIRMAN. Objection is heard. We loaned Marriott $9 million for the the amendment. The gentleman from Wisconsin [Mr. privatization of hotels in Budapest. The Clerk read as follows: LUG K ] is recognized for 5 minutes. Clearly, what we need to do is have a Amendment offered by Mr. CALLAHAN as a Mr. KLUG. Mr. Chairman, as you transition window where OPIC is al- substitute for the amendment offered by Mr. know, we have just had a long debate lowed to continue its job of offering KLUG: Page 5, line 9, strike ‘‘$79,000,000’’ and about the proper role of OPIC in terms loans which cannot be obtained in the insert ‘‘$69,500,000’’. of helping to fund overseas investments private sector to help U.S. companies Page 5, beginning on line 10, strike ‘‘, to be and we had a choice in front of us sev- invest overseas. derived by transfer from the Overseas Pri- eral minutes ago. The amendment of But it is time, clearly, to spin off the vate Investment Corporation Noncredit Ac- the gentleman from Vermont [Mr. privatization of OPIC’s insurance func- count’’. SANDERS] to essentially zero out OPIC tion and actually return dollars to the Mr. CALLAHAN. Mr. Chairman, first funding immediately. But I think the U.S. Treasury and to eliminate what is of all I appreciate the articulate man- suggestion of a number of my col- close to a billion dollar risk for U.S. ner in which the gentleman from Wis- leagues, including the gentleman from taxpayers. consin [Mr. KLUG] has addressed the Ohio [Mr. KASICH], the chairman of the That, I should say, was the intention problem he is concerned about. And I Committee on the Budget, is that we of the House Committee on the Budget certainly share some of the concerns have a second alternative which is to which recommended privatizing and the gentleman has, and he is to be com- take one of the facets of OPIC, pri- phasing out OPIC over the next 3 years. mended for coming before this body vatize it, and sell it off, returning more It was also language in the original au- with a solution that we can live with. money to the Federal Government. thorization bill, but we have discovered The gentleman from Wisconsin [Mr. The OPIC is divided into two funds. that the appropriations bill wanted to KLUG] and I have come to an agree- First of all, the credit program and sec- fund OPIC’s operations by bleeding ment on this matter. We are both in- ond, an insurance program. One of the money out of its reserve accounts. And terested in moving the appropriate key components in OPIC is an insur- if money is taken out of those reserve functions of the Overseas Private In- ance fund and what is does is insure accounts and OPIC’s key asset is essen- vestment Corporation to the private H 6338 CONGRESSIONAL RECORD — HOUSE June 27, 1995 sector. The resulting subsidy appro- Mr. WILSON. Has that ever been it much sooner and much more aggres- priation for OPIC will enable the orga- done before? sively. nization to support American invest- Mr. KLUG. To the best of my knowl- I do not think it makes any sense, ment abroad in a robust manner. edge, no. when we are moving toward privatiza- The increase above the current sub- Mr. WILSON. Mr. Chairman, I would tion of a Government agency, to in- sidy appropriation is substantial and like to have a little dialog here so we crease taxpayer liability, which is pre- indicates the support of this House for all know what we are talking about. cisely what we are doing here. The im- OPIC’s mission. But OPIC should rec- We get varying numbers as to what pact of moving OPIC’s program appro- ognize that this reduction from its re- that reserve account is, but it is some- priation from 33 up to 69 is to increase quest indicates that many Members of where between $2 billion and $2.5 bil- the amount of exposure that the tax- this House, led by the gentleman from lion. Is that the gentleman’s under- payers can be exposed to by OPIC over Wisconsin [Mr. KLUG], expect OPIC to standing? the next fiscal year. That makes no take seriously the proposals for it to Mr. KLUG. In terms of the liability? sense to me, if we are going to, in fact, move many or most of its functions Mr. WILSON. In terms of the amount take a deliberate, thoughtful look at into the private sector. that is returned to the Treasury as well privatization, which I support, it Mr. Chairman, I expect OPIC to as its liability. makes no sense whatsoever to me, to closely consult with the committee as Mr. KLUG. Right, the money re- be increasing the level of public risk at it prepares the report that we have re- turned to the Treasury, I think the the same time we are doing that, for quested on page 10 of the committee re- gentleman is accurate. But my concern two reasons: First is the taxpayers port, and to expand the scope of the re- is the fact that the taxpayers have an ought not to be subjected to more risk, port to include all OPIC activities and exposure of well over $800 million. and second, it seems to me the more to provide the report in a timely man- Mr. WILSON. Yes, but this is some- debt that you load up, the more dif- ner. thing that the gentleman may not ficult it is to sell. It makes it a more Mr. KLUG. Mr. Chairman, will the know that I think he will be interested difficult object for privatization. For gentleman yield?. in, and that is we have done a lot of that reason, I would oppose respect- Mr. CALLAHAN. I yield to the gen- study in the committee as to their fully the subcommittee’s amendment. tleman from Wisconsin. credit procedures and arriving at the Mr. KLUG. Mr. Chairman, will the Mr. KLUG. Mr. Chairman, I would creditworthy projects and over 24 gentleman yield? like to tell my colleague from Ala- years, they have only had to pay Mr. ANDREWS. I yield to the gen- bama, Mr. CALLAHAN that I am in claims of $20 million. That is a pretty tleman from Wisconsin. agreement with his amendment and remarkable record, is it not, for the Mr. KLUG. During the authorization with the reduction which I think is ap- amount of loans they have made? process there were a number of us who propriate. And I want to commend the Mr. KLUG. It is, but as the gen- wanted to move this privatization gentleman for keeping an open mind on tleman knows, past performance is no process forward much more quickly. the subject and I would hope in the fu- guarantee of future performance, as We were not successful in bringing that ture I could count on the gentleman’s they will tell you in any investment in- fight to the floor. support to move OPIC toward privat- strument. Clearly, what we are doing today is ization. Mr. WILSON. We could talk about guaranteeing the Committee on Appro- Mr. CALLAHAN. The gentleman cer- what Harry Truman said about those priations does not take us three steps tainly can. who read history, too. backward. That is the importance of Mr. WILSON. Mr. Chairman, will the Mr. ANDREWS. Mr. Chairman, I today’s amendment, is to say if we are gentleman yield? move to strike the last word. I will going to preserve that option next Mr. CALLAHAN. I yield to the gen- yield to the gentleman from Alabama year, that is the only option in front of tleman from Texas. [Mr. CALLAHAN], the subcommittee us today, given our ability to legislate Mr. WILSON. Mr. Chairman, what is chairman, to answer my questions. on appropriations bills, then I think the final figure that the two gentlemen My understanding is in the present this is the best way to guarantee we have arrived at there? fiscal year the level of appropriation will move toward privatization. Mr. CALLAHAN. Mr. KLUG’s amend- for OPIC is $33 million in the program Mr. KASICH. Mr. Chairman, will the ment was to strike $79 million and in- account; is that correct? gentleman yield? sert $60 million. My amendment brings Mr. CALLAHAN. Mr. Chairman, will Mr. ANDREWS. I yield to the gen- it up back up to $69 million. It is a the gentleman yield? tleman from Ohio. compromise. Mr. ANDREWS. I yield to the gen- Mr. KASICH. Let me say to the gen- Mr. WILSON. Mr. Chairman, I would tleman from Alabama. tleman from New Jersey that I share like to ask the gentleman from Wis- Mr. CALLAHAN. The gentleman is his concern on this, and let me say that consin [Mr. KLUG] a question. correct. there is no agreement that ever gets I do not quite understand the effect Mr. ANDREWS. It is further my un- worked out that represents 100 percent. of the gentleman’s transfer language. derstanding that the underlying bill I mean, I wish it did, because I spent Can he explain that to me? that the chairman has brought to the my whole life being frustrated because Mr. KLUG. Mr. Chairman, will the floor increases that to $79 million for I cannot get everything I want, but you gentleman yield? fiscal 1996; is that correct? In the pro- cannot in the real world. Mr. CALLAHAN. I yield to the gen- gram account? The gentleman from Alabama [Mr. tleman from Wisconsin. Mr. CALLAHAN. The gentleman is CALLAHAN] has stopped the transfer of Mr. KLUG. Certainly, OPIC has two correct, 69.5. money from this reserve account. Why accounts. The one account, obviously, do we not want to transfer it? Because b involves the credit program, which pro- 1530 it is the most valuable resource that vides investment financing through di- Mr. KLUG’s amendment would have OPIC has so that when, in fact, we rect and guaranteed loans. reduced that from 79 down to 60, and move to privatize, that those funds are But then OPIC also has the reserve the effect of your amendment is to in place and it makes an attractive pri- account which is essentially a reserve bring it back up to $69 million? Is that vate sector investment. guaranteeing the insurance component correct? Now, the fact that the chairman has of OPIC. If you begin to take that Mr. CALLAHAN. If the gentleman moved, I mean, basically we kind of money out of the insurance fund to es- will yield, that is correct. split the difference. I mean, that is sentially cover operating costs, you Mr. ANDREWS. I object to and op- really what we did in an effort to make have now begun to bleed down the in- pose this amendment for the following sure that we get this done, that we do surance reserves, which essentially reason: I think that the authorizing not raid the reserve fund, that we do makes it much more difficult next year bill that we passed here 2 weeks ago not increase it like the appropriators for those of us who want to privatize was correct in moving us toward pri- were saying, and that next year, I will OPIC to indeed privatize it. vatization of OPIC. I wish we had done say to the gentleman from New Jersey, June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6339 we will have that reauthorization of sionalize the police in the region, and very important effort to insure that this program, and we are going to have allowed on-going efforts to improve adequate monies are available for U.S. a pretty big fight on this floor. and strengthen prosecutorial and judi- police training and exchanges for East- I think what we have been able to do cial agencies. Furthermore, the House ern Europe and the Baltic States. in stopping the transfer of these funds Committee on International Relations Today organized crime and criminal is to dramatically increase the chance has recognized the critical need and elements in the region threaten the we are going to privatize it. importance of this funding. In its re- very reform and democracy most of our The gentleman from New York [Mr. port on the ‘‘American Overseas Inter- U.S. assistance and other U.S. govern- GILMAN] supports privatization. I am ests Act of 1995,’’ which passed this ment efforts are intended to help fos- told the chairman supports privatiza- House on June 8, the Committee urged ter. tion. The amendment offered by the that up to $30 million be allocated in I was very pleased to have led the gentleman from Wisconsin [Mr. KLUG] each of FY96 and FY97 to support rule way initially in asking for and getting calls for privatization. I strongly be- of law, law enforcement, and criminal the FBI, DEA, U.S. Customs, and other lieve in privatization. I suspect the justice assistance activities in the NIS, U.S. law enforcement entities, monies gentleman from Texas and all of us will and East European and Baltic States. I in FY 1995 to carry on these critical po- have a fight next year on privatization. agree that this is sound policy. lice training programs in both the I think we will win that fight. The goal of funding programs to as- former Soviet Union and the NIS. What this amendment does is to sist the struggling democracies of the These programs are intended to profes- guarantee us and sets us up for the pri- NIS and Eastern Europe will fail if sionalize and made the local police bet- vatization of OPIC and moves us closer criminal elements take over those ter able to cope with this serious prob- to what our goals were within the countries. Moreover, organized crime lem of crime, especially organized budget and stops the transfer of those that flourishes in Russia is spilling crime. funds. over into the United States. The prob- Since the initial $30 million was So I think this is a great victory for lem is so prevalent that the FBI estab- made available in FY 1995 for these po- those people who want to make a big lished a Russian Organized Crime lice training programs, the FBI, DEA, dent in corporate welfare. Squad in May 1994. Earlier this year U.S. Customs and others have trained Mr. ANDREWS. Reclaiming my time, the FBI arrested in New York allegedly more than 1,000 police officers in the I am going to support the amendment one of the most powerful Russian crime former Soviet Union and the NIS. We offered by the gentleman from Wiscon- leaders along with five of his associates are making progress and must continue sin [Mr. KLUG] even if amended in this on federal charges of conspiracy to these valuable efforts that benefits us, way. I agree with what the chairman commit extortion. as well as these new nations in the re- just said. According to the FBI, Russian orga- gion. I am pleased to join in this effort I would ask the chairman and the Re- nized crime groups use businesses in to keep these programs fully sup- publican leadership to consider ac- the NIS, Western and Central Europe, ported. tively inclusion of this issue in the rec- and the United States to serve as Finally, let me set the record onciliation bill that is forthcoming. I fronts for laundering the proceeds of il- straight. This isn’t just another foreign see no reason why we have to wait legal activities and for conducting aid program for police officers over- until next year to resolve the underly- highly profitable commerce in goods in seas. What is also at stake here is ef- ing debate. That is obviously your call. the Commonwealth of Independent forts by our FBI and other U.S. law en- I would respectfully request you con- States. This commerce, rife with cor- forcement agencies to get a handle on sider dealing with this in the reconcili- ruption, thrives on such illegal prac- Russian organized crime here at home. ation bill. tices as extortion, kickbacks, bribery Major crime elements that are fast The CHAIRMAN. The question is on of public officials, and violence. spreading to the U.S., witness the ar- the amendment offered by the gen- Last year Congress began to address rest most recently in NYC of a major tleman from Alabama [Mr. CALLAHAN] the serious organized crime threat in Russian organized crime figure still as a substitute for the amendment of- the region and we should do so again closely linked to his homeland. fered by the gentleman from Wisconsin this year. I would appreciate knowing These overseas police training pro- [Mr. KLUG]. whether the chairman of the Foreign grams give the FBI and other U.S. law The amendment offered as a sub- Operations appropriations subcommit- enforcement known and reliable U.S. stitute for the amendment was agreed tee will work with me to provide the trained police counterparts in the re- to. necessary funding for this critical pur- gion. These officers can in turn later The CHAIRMAN. The question is on pose. work cooperatively with us to help the amendment offered by the gen- Mr. CALLAHAN. Mr. Chairman, will solve the problem of transnational or- tleman from Wisconsin [Mr. KLUG], as the gentleman yield? ganized crime operating and threaten- amended. Mr. WOLF. I yield to the gentleman ing both our as well as their internal The amendment, as amended, was from Alabama. security and safety. agreed to. Mr. CALLAHAN. Mr. Chairman, I ap- I compliment the efforts of my col- Mr. WOLF. Mr. Chairman, I move to preciate the gentleman yielding to me, league, the gentleman from Virginia, strike the last word. and I also appreciate your bringing this [Mr. WOLF], and also urge that this Mr. Chairman, I filed an amendment important issue to the attention of the matter receive the highest priority in for consideration which would have House. I share your concerns about the conference as discussed here today. provided $30 million for law enforce- detrimental impact organized crime is The CHAIRMAN. Are there further ment training and judicial improve- having on the Newly Independent amendments to title I? ment efforts in Russia, the new inde- States, Eastern Europe, and the Baltic If not, the Clerk will designate title pendent states of the former Soviet states, as well as the United States. I II. The text of title II is as follows: Union, Central and Eastern Europe and look forward to working with you, the the Baltic States. I will not offer the members of the subcommittee, and our TITLE II—BILATERAL ECONOMIC ASSISTANCE amendment today; however, I would Senate counterparts in adequately like to raise this issue in the House and funding cooperative programs for es- FUNDS APPROPRIATED TO THE PRESIDENT obtain an assurance from Chairman For expenses necessary to enable the Presi- tablishment of the rule of law, law en- dent to carry out the provisions of the For- CALLAHAN that this training is a prior- forcement, and criminal justice assist- eign Assistance Act of 1961, and for other ity that will be addressed in con- ance to help foster the growth of de- purposes, to remain available until Septem- ference. mocracy. ber 30, 1996, unless otherwise specified here- Last year Congress set aside $30 mil- Mr. GILMAN. Mr. Chairman, I move in, as follows: lion which enabled the FBI, DEA, U.S. to strike the last word. AGENCY FOR INTERNATIONAL DEVELOPMENT Customs, and other U.S. law enforce- Mr. Chairman, I am pleased to join CHILD SURVIVAL AND DISEASE PROGRAMS FUND ment agencies to start new and innova- my colleague, the gentleman from Vir- For necessary expenses to carry out the tive training programs to help profes- ginia [Mr. WOLF], in support of this provisions of part I and chapter 4 of part II H 6340 CONGRESSIONAL RECORD — HOUSE June 27, 1995 of the Foreign Assistance Act of 1961, for eign Assistance Act of 1961, $528,000,000, to re- penses of the Agency for International De- child survival, assistance to combat tropical main available until September 30, 1997: Pro- velopment. and other diseases, and related assistance ac- vided, That none of the funds appropriated by PAYMENT TO THE FOREIGN SERVICE tivities, $484,000,000, to remain available this Act to carry out chapters 1 and 10 of RETIREMENT AND DISABILITY FUND until September 30, 1997: Provided, That this part I of the Foreign Assistance Act of 1961 For payment to the ‘‘Foreign Service Re- amount shall be made available for such ac- shall be transferred to the Government of tirement and Disability Fund’’, as author- tivities as (1) immunization programs, (2) Zaire: Provided further, That funds appro- ized by the Foreign Service Act of 1980, oral rehydration programs, (3) health and priated under this heading which are made $43,914,000. nutrition programs, and related education available for activities supported by the programs, which address the needs of moth- Southern Africa Development Community OPERATING EXPENSES OF THE AGENCY FOR ers and children, (4) water and sanitation shall be made available notwithstanding sec- INTERNATIONAL DEVELOPMENT programs, (5) assistance for displaced and or- tion 512 of this Act and section 620(q) of the For necessary expenses to carry out the phaned children, (6) programs for the preven- Foreign Assistance Act of 1961. provisions of section 667, $465,750,000: Pro- vided, That of this amount not more than tion, treatment, and control of, and research PRIVATE AND VOLUNTARY ORGANIZATIONS on, HIV/AIDS, polio, malaria and other dis- $1,475,000 may be made available to pay for None of the funds appropriated or other- eases, and (7) a contribution on a grant basis printing costs: Provided further, That none of wise made available by this Act for develop- to the United Nations Children’s Fund the funds appropriated by this Act for pro- ment assistance may be made available to (UNICEF): Provided further, That funds ap- grams administered by the Agency for Inter- any United States private and voluntary or- propriated under this heading shall be made national Development may be used to fi- ganization, except any cooperative develop- available notwithstanding any other provi- nance printing costs of any report or study ment organization, which obtains less than sion of law, and shall be in addition to (except feasibility, design, or evaluation re- 20 per centum of its total annual funding for amounts otherwise available for such pur- ports or studies) in excess of $25,000 without international activities from sources other poses. the approval of the Administrator of that than the United States Government: Pro- Agency or the Administrator’s designee. DEVELOPMENT ASSISTANCE FUND vided, That the requirements of the provi- In addition, for necessary expenses to (INCLUDING TRANSFERS OF FUNDS) sions of section 123(g) of the Foreign Assist- carry out the provisions of section 667 relat- For necessary expenses to carry out the ance Act of 1961 and the provisions on pri- ed to the termination or phasing down of provisions of sections 103 through 106 of the vate and voluntary organizations in title II programs, activities, and operations of the Foreign Assistance Act of 1961, $669,000,000, of the ‘‘Foreign Assistance and Related Pro- Agency for International Development under to remain available until September 30, 1997: grams Appropriations Act, 1985’’ (as enacted chapters 1, 10, and 11 of part I and chapter 4 Provided, That none of the funds made avail- in Public Law 98–473) shall be superseded by of part II of the Foreign Assistance Act of able in this Act nor any unobligated bal- the provisions of this section. 1961, and for related purposes, $29,925,000, to ances from prior appropriations may be Funds appropriated or otherwise made remain available until September 30, 1997: made available to any organization or pro- available under title II of this Act should be Provided, That such funds are available in ad- gram which, as determined by the President made available to private and voluntary or- dition to amounts otherwise available for of the United States, supports or partici- ganizations at a level which is equivalent to such purposes: Provided further, That, prior pates in the management of a program of co- the level provided in fiscal year 1995. Such to the obligation of any funds appropriated ercive abortion or involuntary sterilization: private and voluntary organizations shall in- in this paragraph, the Administrator of the Provided further, That none of the funds made clude those which operate on a not-for-profit Agency for International Development shall available under this heading may be used to basis, receive contributions from private report to the Committees on Appropriations pay for the performance of abortion as a sources, receive voluntary support from the on the proposed use of such funds: Provided method of family planning or to motivate or public and are deemed to be among the most further, That by September 30, 1997, the use coerce any person to practice abortions; and cost-effective and successful providers of de- of such funds should result in the reduction that in order to reduce reliance on abortion velopment assistance. of 500 full-time equivalent direct-hire em- in developing nations, funds shall be avail- INTERNATIONAL DISASTER ASSISTANCE ployees from the onboard level existing on able only to voluntary family planning For necessary expenses for international April 30, 1995: Provided further, That the au- projects which offer, either directly or disaster relief, rehabilitation, and recon- thority of sections 109 and 610 may be used through referral to, or information about ac- struction assistance pursuant to section 491 for the purpose of making funds available to cess to, a broad range of family planning of the Foreign Assistance Act of 1961, as fulfill the requirements of section 667. methods and services: Provided further, That amended, $200,000,000 to remain available OPERATING EXPENSES OF THE AGENCY FOR in awarding grants for natural family plan- until expended. INTERNATIONAL DEVELOPMENT OFFICE OF IN- ning under section 104 of the Foreign Assist- DEBT RESTRUCTURING SPECTOR GENERAL ance Act of 1961 no applicant shall be dis- For necessary expenses to carry out the criminated against because of such appli- For the cost, as defined in section 502 of the Congressional Budget Act of 1974, of provisions of section 667, $35,200,000, which cant’s religious or conscientious commit- sum shall be available for the Office of the ment to offer only natural family planning; modifying direct loans and loan guarantees, as the President may determine, for which Inspector General of the Agency for Inter- and, additionally, all such applicants shall national Development. comply with the requirements of the pre- funds have been appropriated or otherwise vious proviso: Provided further, That nothing made available for programs within the OTHER BILATERAL ECONOMIC ASSISTANCE in this paragraph shall be construed to alter International Affairs Budget Function 150, ECONOMIC SUPPORT FUND including the cost of selling, reducing, or any existing statutory prohibitions against For necessary expenses to carry out the canceling amounts, through debt buybacks abortion under section 104 of the Foreign As- provisions of chapter 4 of part II, and swaps, owed to the United States as a re- sistance Act of 1961: Provided further, That, $2,326,700,000, to remain available until Sep- sult of concessional loans made to eligible notwithstanding section 109 of the Foreign tember 30, 1997: Provided, That any funds ap- Latin American and Caribbean countries, Assistance Act of 1961, of the funds appro- propriated under this heading that are made pursuant to part IV of the Foreign Assist- priated under this heading and under the available for Israel shall be made available ance Act of 1961, $7,000,000, to remain avail- heading ‘‘Development Fund for Africa’’, not on a grant basis as a cash transfer and shall able until expended. to exceed a total of $15,500,000 may be trans- be disbursed within thirty days of enactment ferred to ‘‘Debt restructuring’’, and that any MICRO AND SMALL ENTERPRISE DEVELOPMENT of this Act or by October 31, 1995, whichever such transfer of funds shall be subject to the PROGRAM ACCOUNT is later: Provided further, That none of the regular notification procedures of the Com- For the subsidy cost of direct loans and funds appropriated under this heading shall mittees on Appropriations: Provided further, loan guarantees, $1,500,000, as authorized by be made available for Zaire. That, notwithstanding section 109 of the For- section 108 of the Foreign Assistance Act of INTERNATIONAL FUND FOR IRELAND eign Assistance Act of 1961, of the funds ap- 1961, as amended: Provided, That such costs For necessary expenses to carry out the propriated under this heading and under the shall be as defined in section 502 of the Con- provisions of part I of the Foreign Assistance heading ‘‘Development Fund for Africa’’, not gressional Budget Act of 1974. In addition, Act of 1961, up to $19,600,000, which shall be to exceed a total of $15,000,000 may be trans- for administrative expenses to carry out pro- available for the United States contribution ferred to ‘‘International Organizations and grams under this heading, $500,000, all of to the International Fund for Ireland and Programs’’ for a contribution to the Inter- which may be transferred to and merged shall be made available in accordance with national Fund for Agricultural Development with the appropriation for Operating Ex- the provisions of the Anglo-Irish Agreement (IFAD), and that any such transfer of funds penses of the Agency for International De- Support Act of 1986 (Public Law 99–415): Pro- shall be subject to the regular notification velopment. vided, That such amount shall be expended at procedures of the Committees on Appropria- HOUSING GUARANTY PROGRAM ACCOUNT the minimum rate necessary to make timely tions. For administrative expenses to carry out payment for projects and activities: Provided DEVELOPMENT FUND FOR AFRICA guaranteed loan programs, $7,000,000, all of further, That funds made available under this For necessary expenses to carry out the which may be transferred to and merged heading shall remain available until Septem- provisions of chapter 10 of part I of the For- with the appropriation for Operating Ex- ber 30, 1997. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6341

ASSISTANCE FOR EASTERN EUROPE AND THE procedures of the Committees on Appropria- sections 5921 through 5925 of title 5, United BALTIC STATES tions. States Code; purchase and hire of passenger For necessary expenses to carry out the (g) Funds made available in this Act for as- motor vehicles; and services as authorized by provisions of the Foreign Assistance Act of sistance to the new independent states of the section 3109 of title 5, United States Code, 1961 and the Support for East European De- former Soviet Union shall be subject to the $671,000,000, of which not to exceed $12,000,000 mocracy (SEED) Act of 1989, $324,000,000, to provisions of section 117 (relating to environ- shall be available for administrative ex- remain available until September 30, 1997, ment and natural resources) of the Foreign penses. which shall be available, notwithstanding Assistance Act of 1961. REFUGEE RESETTLEMENT ASSISTANCE (h) Funds appropriated under this heading any other provision of law, for economic as- For necessary expenses for the targeted as- sistance and for related programs for East- may be made available for assistance for sistance program authorized by title IV of ern Europe and the Baltic States. Mongolia. the Immigration and Nationality Act and Funds appropriated under this heading or (i) Funds made available in this Act for as- in prior appropriations Acts that are or have sistance to the new independent states of the section 501 of the Refugee Education Assist- been made available for an Enterprise Fund former Soviet Union shall be provided to the ance Act of 1980 and administered by the Of- may be deposited by such Fund in interest- maximum extent feasible through the pri- fice of Refugee Resettlement of the Depart- bearing accounts prior to the Fund’s dis- vate sector, including small- and medium- ment of Health and Human Services, in addi- bursement of such funds for program pur- size businesses, entrepreneurs, and others tion to amounts otherwise available for such poses. The Fund may retain for such pro- with indigenous private enterprises in the re- purposes, $5,000,000. gram purposes any interest earned on such gion, intermediary development organiza- UNITED STATES EMERGENCY REFUGEE AND deposits without returning such interest to tions committed to private enterprise, and MIGRATION ASSISTANCE FUND the Treasury of the United States and with- private voluntary organizations previously For necessary expenses to carry out the out further appropriation by the Congress. functioning in the new independent states. provisions of section 2(c) of the Migration Funds made available for Enterprise Funds (j) The ratio of private sector investment and Refugee Assistance Act of 1962, as shall be expended at the minimum rate nec- (including volunteer contributions in cash or amended (22 U.S.C. 260(c)), $50,000,000, to re- essary to make timely payment for projects time) to United States government assist- main available until expended: Provided, and activities. ance in projects referred to in subsection (i) That the funds made available under this Funds appropriated under this heading shall be no less than a ratio of 1.5 to 1. heading are appropriated notwithstanding shall be considered to be economic assist- INDEPENDENT AGENCIES the provisions contained in section 2(c)(2) of ance under the Foreign Assistance Act of the Migration and Refugee Assistance Act of 1961 for purposes of making available the ad- AFRICAN DEVELOPMENT FOUNDATION For necessary expenses to carry out the 1962 which would limit the amount of funds ministrative authorities contained in that which could be appropriated for this purpose. Act for the use of economic assistance. provisions of title V of the International Se- ANTI-TERRORISM ASSISTANCE ASSISTANCE FOR THE NEW INDEPENDENT curity and Development Cooperation Act of STATES OF THE FORMER SOVIET UNION 1980, Public Law 96–533, and to make such For necessary expenses to carry out the contracts and commitments without regard (a) For necessary expenses to carry out the provisions of chapter 8 of part II of the For- to fiscal year limitations, as provided by 31 provisions of chapter 11 of part I of the For- eign Assistance Act of 1961, $17,000,000. U.S.C. 9104, $10,000,000. eign Assistance Act of 1961 and the FREE- NONPROLIFERATION AND DISARMAMENT FUND DOM Support Act, for assistance for the new INTER-AMERICAN FOUNDATION For necessary expenses for a ‘‘Non- independent states of the former Soviet For expenses necessary to carry out the proliferation and Disarmament Fund’’, Union and for related programs, and for functions of the Inter-American Foundation $20,000,000, to remain available until ex- other purposes, $595,000,000, to remain avail- in accordance with the provisions of section pended, to promote bilateral and multilat- able until September 30, 1997: Provided, That 401 of the Foreign Assistance Act of 1969, and eral activities: Provided, That such funds the provisions of 498B(j) of the Foreign As- to make such contracts and commitments may be used pursuant to the authorities con- sistance Act of 1961 shall apply to funds ap- without regard to fiscal year limitations, as tained in section 504 of the FREEDOM Sup- propriated by this paragraph. provided by section 9104, title 31, United port Act: Provided further, That such funds (b) None of the funds appropriated under States Code, $20,000,000. may also be used for such countries other this heading shall be transferred to the Gov- PEACE CORPS than the new independent states of the ernment of Russia— For expenses necessary to carry out the former Soviet Union and international orga- (1) unless that Government is making provisions of the Peace Corps Act (75 Stat. nizations when it is in the national security progress in implementing comprehensive 612), $210,000,000, including the purchase of interest of the United States to do so: Pro- economic reforms based on market prin- not to exceed five passenger motor vehicles vided further, That funds appropriated under ciples, private ownership, negotiating repay- for administrative purposes for use outside this heading may be made available notwith- ment of commercial debt, respect for com- of the United States: Provided, That none of standing any other provision of law: Provided mercial contracts, and equitable treatment the funds appropriated under this heading further, That funds appropriated under this of foreign private investment; and shall be used to pay for abortions. heading shall be subject to the regular noti- (2) if that Government applies or transfers fication procedures of the Committees on DEPARTMENT OF STATE United States assistance to any entity for Appropriations. the purpose of expropriating or seizing own- INTERNATIONAL NARCOTICS CONTROL AMENDMENT OFFERED BY MR. BROWNBACK ership or control of assets, investments, or For necessary expenses to carry out the ventures. provisions of section 481 of the Foreign As- Mr. BROWNBACK. Mr. Chairman, I (c) Funds may be furnished without regard sistance Act of 1961, $113,000,000: Provided, offer an amendment, amendment No. to subsection (b) if the President determines That during fiscal year 1996, the Department 64. that to do so is in the national interest. of State may also use the authority of sec- The CHAIRMAN. The Clerk will des- (d) None of the funds appropriated under tion 608 of the Foreign Assistance Act of ignate the amendment. this heading shall be made available to any 1961, without regard to its restrictions, to re- government of the new independent states of The text of the amendment is as fol- ceive non-lethal excess property from an lows: the former Soviet Union if that government agency of the United States Government for directs any action in violation of the terri- the purpose of providing it to a foreign coun- Amendment offered by Mr. BROWNBACK: torial integrity or national sovereignty of try under chapter 8 of part I of that Act sub- Page 12, line 8 strike ‘‘$7,000,000’’ and insert any other new independent state, such as ject to the regular notification procedures of ‘‘$3,000,000’’. those violations included in Principle Six of the Committees on Appropriations. Page 13, strike line 18 and all that follows the Helsinki Final Act: Provided, That such through page 14, line 11. funds may be made available without regard MIGRATION AND REFUGEE ASSISTANCE Page 16, line 24, strike ‘‘$595,000,000’’ and to the restriction in this subsection if the For expenses, not otherwise provided for, insert ‘‘$619,000,000’’. necessary to enable the Secretary of State to President determines that to do so is in the Mr. BROWNBACK. Mr. Chairman, I national security interest of the United provide, as authorized by law, a contribution States: Provided further, That the restriction to the International Committee of the Red would like to inform the Members this of this subsection shall not apply to the use Cross, assistance to refugees, including con- amendment is designed to have several of such funds for the provision of assistance tributions to the International Organization outcomes, and what we are doing with for purposes of humanitarian, disaster and for Migration and the United Nations High this I will describe briefly in this pres- refugee relief. Commissioner for Refugees, and other activi- entation. (e) None of the funds appropriated under ties to meet refugee and migration needs; It is intended to restore part of the this heading for the new independent states salaries and expenses of personnel and de- funding for the newly independent pendents as authorized by the Foreign Serv- of the former Soviet Union shall be made states of the former Soviet Union pro- available for any state to enhance its mili- ice Act of 1980; salaries and expenses of per- tary capability. sonnel assigned to the bureau charged with vided by H.R. 1561, the American Over- (f) Funds appropriated under this heading carrying out the Migration and Refugee As- seas Interests Act, by removing some shall be subject to the regular notification sistance Act; allowances as authorized by funds from other places. H 6342 CONGRESSIONAL RECORD — HOUSE June 27, 1995 My amendment is also intended to Our assistance program in the new I say to my colleagues, If you want reduce the Treasury buy-back fund to independent states is a vital effort to to reduce the deficit, that is another the level authorized by the American support the growth of democracy and thing. I wouldn’t have agreed to the Overseas Interests Act previously ap- market-based economies in the region $595 million. It was much more than I proved by this Congress and to elimi- of the former Soviet Union. wanted. But in the spirit of com- nate the AID reform and downsizing It is also vital to alleviating humani- promise, in trying to work out some bi- account, a fund not authorized by H.R. tarian needs in the region—particu- partisan arrangement to give the ad- 1561. larly in Armenia, Georgia and ministration the ability to have an ef- Finally, my amendment would cut an Tajikistan. fective foreign policy, I finally agreed additional $22 million in foreign assist- In short—in ways both large and to the $595 million. To increase it fur- ance funds. small—this program is serving the ther just sort of goes against my grain, Now, AID argues it needs the $30 mil- American national interest in that re- but certainly not against the intent of lion reform and downsizing account in gion. what the gentleman is trying to ac- order to make a 10-percent cut in budg- Frankly, in this time of difficult complish, and that is to reduce AID et, a $30 million reform and downsizing budget decisions, we have had to re- money and to increase NIS money. account to make a 10-percent cut in duce this assistance program. But I say to my colleagues, I think budget. Under the amount contained in this that the House has already decided and By analogy, the ICC is making a 33- bill, as reported by the Appropriations determined to radically downsize AID percent cut. It is not asking for a dime. Committee, this assistance program is and to merge it into the State Depart- already: 30 percent below the fiscal I realize downsizing AID is very com- ment, which your committee wants, year 1995 appropriation, and 24 percent plicated, particularly more so than the but that will take a couple of years, below the fiscal year 1996 request. ICC. I am not certain about that. and the saving the gentleman is using But does AID need $30 million to Most important, the amount included may leave AID unable to administer make a $50 million cut? The GAO will in this measure is $48 million below the the very program he wants to expand. be analyzing this issue and issuing a amount approved by this House when it With his amendment AID might have report in September. Let us appro- recently approved the foreign aid au- to shut down. priate what we agreed to authorize and thorization bill. So, Mr. Chairman, I respectfully sug- revisit the issue in September if GAO Mr. Chairman, I urge my colleagues gest to the sponsor that he withdraw thinks AID needs the money in order to support the amendment offered by his amendment and that we work with to downsize. the gentleman from Kansas. Now, on the second part of this is the Mr. BROWNBACK. Mr. Chairman, the managers on both sides of the aisle Treasury buy-back fund performs an just in closing on this, this succinctly to see if some accommodation can be admirable foreign assistance function, moves money from the AID reform ac- worked out. At this time I am obliged reducing bilateral debt of Latin Amer- count, which was not approved by the to oppose it because I feel like it in- ican countries to support environ- authorizors, into NIS, which is already fringes upon the agreement, the gentle- mental and child survival activities. being cut 75 percent, and it further re- man’s agreement I have with the gen- However, we have $5 trillion in debt. duces the deficit and cuts outlays an tleman from Wisconsin [Mr. OBEY], and We have our own to worry about. We additional $22 million. It puts money the gentleman from Texas [Mr. WIL- need to put our own fiscal house in where it ought to be. It cuts the budg- SON], and the other Members of the order. That is why I am calling for ad- et. It cuts the deficit. committee. Both sides of the commit- ditional reduction here. I urge my colleagues to support this tee, when this bill came out of sub- We have got to take care of this place amendment. committee, went around the table, and so that we can have something to pass Mr. CALLAHAN. Mr. Chairman, I I said if one member, if one member of on to our own children, not worry rise in opposition to the amendment. our subcommittee on the Republican about that so much in other countries. First of all, I applaud the courage of side opposed this agreement that we Regarding the NIS, I would just want the gentleman from Kansas today in have structured, that fragile agree- to put this briefly to my colleagues: I introducing the amendment, and cer- ment which included more money for think we need to put these funds back tainly I do not think there is any Mem- AID, well, then I said the agreement in NIS. The NIS fund will have been ber of this Congress, especially some- would not be put into effect. cut by 27 percent from fiscal year 1995 one who has only been here such a So, we have a fragile agreement. I am level and by 75 percent from fiscal year short time as the gentleman from Kan- going to live up to that commitment. 1994 level. This cut we are proposing sas [Mr. BROWNBACK], who has grasped Under no circumstances can I vote for would eliminate waste which has al- international affairs such as he has. I any amendment that is going to in- ready been cut, get at the waste of this know that you are a very valuable ally crease AID to the independent states or program. That is why I think we need to Chairman GILMAN on the Committee to Russia because I feel that we have to restore these monies in this particu- on International Relations. gone overboard with respect to our lar area of the program. The gentleman was not here the last ability at this time in our history. So I think we had better think about, la- years during the appropriation process I respectfully oppose the amendment dies and gentlemen, what we are doing when we first started funding for Rus- and would hope that the sponsor would here in taking further, taking it down sia and the independent states. I think withdraw it. more than 75 percent from previously. that I was probably the only Member of Mr. WILSON. Mr. Chairman, I move These are countries that are strug- the House that stood in opposition to to strike the last word. gling to survive, struggling to democ- that, because I felt that while we want- Mr. Chairman, I, too, would like to ratize. We need to help them out. We ed to help Russia and the other inde- rise in opposition to the amendment. need to do whatever we can here, and pendent states emerge as industrialized Mr. Chairman, I will not take the en- this small bit of money, I think, is far nations and we wanted to help them tire 5 minutes, but I will say it is un- better spent here in helping INS coun- get on their feet and form a good de- fortunate that the full Committee on tries to stabilize than to having AID mocracy, it was I who stood on the Appropriations is meeting at the reform and downsize and spend $30 mil- floor and said we do not have the present time because we have so many lion to make a $50 million cut. money to do that. Members that are interested that are not here, but I will say that I feel cer- Mr. GILMAN. Mr. Chairman, will the b gentleman yield? 1545 tain that the ranking member, the gen- Mr. BROWNBACK. I yield to the gen- Mr. Chairman, the very fact that the tleman from Wisconsin [Mr. OBEY] and tleman from New York, the chairman gentleman is now coming before this the chairman of the full committee of the authorizing committee. committee that now I am chairing, and would both vigorously oppose this Mr. GILMAN. Mr. Chairman, I am let me say we reduced the aid from $842 amendment because of the AID reduc- pleased to rise in support of the amend- million in 1995 to $595 million in 1996, tions. I think they would also certainly ment by my good colleague, the gen- and I just feel like that we do not have oppose the reduction in the loan for- tleman from Kansas [Mr. BROWNBACK]. the money to give more aid to Russia. giveness for the poorest of the poor June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6343 countries, and I think I pushed the Although there are reductions in foreign aid Calvert Hefley Packard chairman about as hard as he can be Canady Hefner Parker in this bill, we must continue to make clear our Cardin Heineman Pastor pushed on the NIS, and I do not want international priorities. If we do not earmark Castle Hilleary Paxon to try to push him any further. $150 million for assistance to Ukraine, we Chambliss Hilliard Payne (NJ) So, for that reason I would oppose send the wrong signal to that country, and all Chapman Hinchey Payne (VA) the amendment as well, and I hope the Chenoweth Hobson Pelosi other countries that are instituting democratic Chrysler Hoekstra Peterson (MN) gentleman would withdraw it, and we reforms. We must not tell Ukraine that there is Clay Hoke Pickett will try very, very hard to work with nothing to be gained by adopting democratic Clayton Holden Pombo him when we get to conference. reforms, maintaining a good human rights Clement Houghton Pomeroy Ms. SLAUGHTER. Mr. Chairman, I rise Clinger Hoyer Portman record, progressing with economic reforms, Clyburn Hunter today in support of the Brownback amendment Poshard and unilaterally disarming their nuclear arse- Coble Hutchinson Pryce to restore funding to the New Independent nal. Coburn Hyde Quillen States. This funding will provide needed as- There are battles being waged right now be- Coleman Istook Quinn sistance to Ukraine, a nation which has con- Collins (GA) Jackson-Lee Rahall tween President Kuchma and the Ukarainian Collins (IL) Jacobs sistently been a leader among these new and Rangel parliament over Ukraine's economic reforms Combest Johnson (CT) Reed independent nations. and unilateral disarmament. Many members of Conyers Johnson (SD) Regula Although I strongly support AID and am not parliament are pointing to the lack of past sup- Cooley Johnson, E. B. Richardson pleased with further cuts to AID in order to Costello Johnson, Sam Riggs port from the United States for Ukraine's re- fund the New Independent States, I also feel Cox Johnston Rivers forms, and questioning the benefits of continu- Coyne Jones we must send a strong message of support for Roberts ing down this road. We cannot afford to let the Cramer Kanjorski Roemer Ukraine. I hope we can address the AID short- Cremeans Kaptur Ukrainians turn back. Ukraine and the other Rogers fall as this bill moves through Congress. Cubin Kelly Ros-Lehtinen young nations of the world, struggling with the Cunningham Kennedy (MA) Ukraine has instituted democratic reforms Roukema Danner Kennedy (RI) which have made it one of the most politically implementation of democracy, must know that Roybal-Allard they will benefit from those reforms. Davis Kennelly Rush de la Garza Kildee stable nations in the region. Ukraine and her Sabo Mr. Chairman, Ukraine is deserving of our Deal Kim people play an undeniably important role in Sanders DeFazio Kingston respect, praise, and commitment. I urge my Sawyer this post-cold war world and we would be fool- DeLauro Kleczka colleagues to support increased aid to Schaefer ish not to recognize this fact and do every- DeLay Klink Schiff Ukraine. Dellums Knollenberg thing we can to foster stability and develop- Schroeder The CHAIRMAN. The question is on Deutsch Kolbe ment in that nation. Schumer Diaz-Balart LaFalce With more than 18 percent of the population the amendment offered by the gen- Scott Dickey LaHood tleman from Kansas [Mr. BROWNBACK]. Seastrand of the newly independent states, Ukraine has Dicks Latham Serrano consistently received under 10 percent of the The question was taken; and the Dingell LaTourette Shaw Chairman announced that the noes ap- Dixon Laughlin total U.S. aid provided to the former Soviet Shays Union. To let this continue would be neither peared to have it. Doggett Lazio Dooley Leach Shuster fair nor prudent. RECORDED VOTE Doolittle Levin Sisisky Geographically, Ukraine is the largest nation Mr. BROWNBACK. Mr. Chairman, I Dornan Lewis (CA) Skaggs solely in Europe. Seven decades of Soviet Doyle Lewis (GA) Skeen demand a recorded vote. Skelton rule and collectivization destroyed Ukraine's Dreier Lewis (KY) A recorded vote was ordered. Duncan Lightfoot Smith (TX) once-rich agricultural system, while militariza- The vote was taken by electronic de- Dunn Lincoln Spence tion and the arms race left a huge military-in- vice, and there were—ayes 78, noes 340, Durbin Lipinski Spratt dustrial complex which does nothing to feed or Edwards Livingston Stark not voting 16, as follows: Stearns house Ukraine's 52 million people. This com- Ehlers Lofgren [Roll No. 422] Emerson Longley Stockman plex must continue to be converted to non- Stokes AYES—78 Engel Lucas military uses. If a humanitarian interest in Eshoo Maloney Studds helping our Ukrainian friends isn't a compelling Baker (CA) Horn Ramstad Evans Manton Stupak Ballenger Hostettler Rohrabacher enough reason to support aid to Ukraine, then Everett Manzullo Talent Bartlett Inglis Rose Ewing Markey Tanner certainly, my colleagues will agree that the Barton Kasich Roth Farr Martinez Taylor (MS) United States has a significant security inter- Blute King Royce Fattah Mascara Taylor (NC) est in making sure this conversion takes Brownback Klug Salmon Fawell Matsui Tejeda Burton Largent Sanford Fazio McCollum Thomas place. Chabot Linder Saxton Fields (LA) McCrery Thompson Despite the recent developments in Russia, Christensen LoBiondo Scarborough Fields (TX) McDade Thornberry we simply cannot punish its neighboring na- Condit Lowey Sensenbrenner Filner McDermott Thornton Crane Luther Shadegg Flake McHale Thurman tions, like Ukraine, by denying vital assistance Crapo Martini Slaughter to these new and struggling nations. Foglietta McHugh Torkildsen Ehrlich McCarthy Smith (MI) Foley McInnis Torres Mr. Chairman, I urge my colleagues' support English McIntosh Smith (NJ) Forbes McKinney Towns for the people of Ukraine and their vote in Ensign McKeon Smith (WA) Fowler Meehan Tucker Flanagan McNulty Solomon Frank (MA) Meek Velazquez favor of this amendment. Fox Mica Souder Franks (CT) Menendez Vento Mrs. LOWEY. Mr. Chairman, I rise in sup- Franks (NJ) Myrick Stenholm Frelinghuysen Metcalf Visclosky port of increased funding for Ukraine. Ukraine Ganske Neumann Stump Frisa Meyers Volkmer Gekas Norwood Tate is one of our most important allies among the Funderburk Miller (CA) Vucanovich Geren Orton Tiahrt Gallegly Miller (FL) New Independent States [NIS] of the former Waldholtz Gilman Pallone Traficant Gejdenson Mineta Walsh Soviet Union. Since its independence, Ukraine Graham Peterson (FL) Upton Gephardt Minge Wamp has instituted democratic reforms, making it Gutknecht Petri Walker Gibbons Mink Ward Hancock Porter Weldon (PA) Gilchrest Molinari the most stable country in the region. Waters In 1994, Ukraine held democratic elections, Herger Radanovich Weller Gillmor Mollohan Gonzalez Montgomery Watt (NC) voting in a new parliament and a new presi- NOES—340 Goodlatte Moorhead Watts (OK) dent. They have accepted all of our requests, Abercrombie Bateman Bono Goodling Moran Waxman including the ratification of START and NPT, Ackerman Becerra Borski Gordon Morella Weldon (FL) Allard Beilenson Boucher Goss Murtha White and are in the midst of economic reform that Andrews Bentsen Brewster Green Myers Whitfield has won praise from the IMF and G±7. Archer Bereuter Browder Greenwood Nadler Wicker In the wake of this significant show of stabil- Armey Berman Brown (CA) Hall (OH) Neal Williams ity in an otherwise fragile region, it is impera- Bachus Bevill Brown (FL) Hall (TX) Nethercutt Wilson Baesler Bilbray Brown (OH) Hamilton Ney Wise tive that the United States show strong eco- Baker (LA) Bilirakis Bryant (TN) Hansen Nussle Wolf nomic support for Ukraine. Although Ukrain- Baldacci Bishop Bryant (TX) Harman Oberstar Woolsey ians make up almost one-fifth of the popu- Barcia Bliley Bunn Hastert Obey Wyden lation of the NIS, they receive less than 10 Barr Boehlert Bunning Hastings (FL) Olver Wynn Barrett (NE) Boehner Burr Hastings (WA) Ortiz Yates percent of United States aid under the Free- Barrett (WI) Bonilla Buyer Hayes Owens Young (FL) dom Support Act. Bass Bonior Callahan Hayworth Oxley Zeliff H 6344 CONGRESSIONAL RECORD — HOUSE June 27, 1995 I71NOT VOTING—16 to the limit and experiencing a serious fall of between U.S. $500,000 and U.S. $1 mil- Camp Gutierrez Tauzin cash flow problem by April. lion for 1995. All Donors are urged to confirm Collins (MI) Jefferson Torricelli I have here a copy of a letter from commitments as soon as possible, and to Ford Lantos Young (AK) the Burma Border Consortium Chair- transfer funds as quickly possible to support Frost Mfume Zimmer the rainy season stockpiling. We will issue Furse Moakley man Jack Dunford requesting addi- another statement when the funding situa- Gunderson Reynolds tional funding. tion becomes clearer. Efforts to combat the growing refu- b 1609 On a more optimistic note, the first re- gee crisis along the Thai-Burma border ports of a Karenni cease-fire deal are coming Messrs. HASTERT, HINCHEY, could be expedited with this additional through, the Mon are reported to be about to DEFAZIO, LATHAM, and RUSH funding particularly if NGO’s on both resume talks with SLORC, and even the changed their vote from ‘‘aye’’ to ‘‘no.’’ sides of the border were empowered Karens are said to be discussing possible ne- Messrs. BARTLETT of Maryland, with proper financing. gotiations. There is still hope for a better fu- CHRISTENSEN, STUMP, PORTER, The Thai Government should not ture, but the needs of the BBC programme SMITH of Michigan, and have to bear the burden of this refugee are unlikely to reduce in 1995. JACK DUNFORD, SCARBOROUGH changed their vote population alone. A clear signal must BBC Chairman. from ‘‘no’’ to ‘‘aye.’’ be sent that the international commu- THE CHURCH OF CHRIST So the amendment was rejected. nity is willing and able to assist the IN THAILAND, The result of the vote was announced Thai, thus preventing the return of ref- Bangkok, June 14, 1995 as above recorded. ugees to unsafe and unacceptable con- BURMESE BORDER CONSORTIUM 1995 AMENDMENT OFFERED BY MR RICHARDSON . ditions. EMERGENCY/FUNDING UPDATE NO. 4 The Richardson-Rohrabacher amend- Mr. RICHARDSON. Mr. Chairman, I Previous updates described two phases of offer an amendment, amendment No. ment increasing the migration and ref- the current emergency on the Burmese bor- 37. ugee assistance funds by $1 million will der. From January through March SLORC The CHAIRMAN. The Clerk will des- enable organizations working along launched a major military offensive against ignate the amendment. both sides of the Thai-Burma border to the Karen National Union opposite Tak and The text of the amendment is as fol- facilitate the settlement of additional Mae Hong Sen Provinces sending as many as lows: refugees. 15,000 new refugees into Thailand. Although a de-facto cease-fire has been in place since Amendment offered by Mr. RICHARDSON: Mr. Chairman, I insert for the then, the second phase of the emergency saw Page 14, line 22, strike ‘‘2,326,700,000’’ and in- RECORD a letter from Jack Dunford, SLORC-backed Karen rebels entering Thai- sert the following ‘‘2,325,500,000’’. chairman of the Burma Border Consor- land, burning down refugee camps and at- Page 21, line 7, strike ‘‘$671,000,000’’ and in- tium. tempting to pursuade the refugees to return sert ‘‘672,000,000’’. THE CHURCH OF CHRIST to Burma. Mr. CALLAHAN. Mr. Chairman, I re- IN THAILAND, At the time of writing the incursions have serve a point of order on the gentle- March 20, 1995. stopped and, for the relief agencies providing man’s amendment. BURMESE BORDER CONSORTIUM assistance, the emergency has entered a The CHAIRMAN. A point of order is EMERGENCY UPDATE third phase. To improve security for the ref- reserved. The Burmese Border Consortium (BBC) six ugees the Thai authorities have ordered a (Mr. RICHARDSON asked and was monthly report to the end of December in- consolidation of the camps located in the given permission to revise and extend corporates a revised Appeal for 1995 and will areas where incursions occurred. In Tak Province camps K8 to K14 are to be consoli- his remarks.) be sent to you next week. The Appeal is for an increased budget of U.S. $5 million to dated in two locations, Sho Khlo (K10) and Mr. RICHARDSON. Mr. Chairman, Mae La (K14), and in Mae Hong Sen Province this amendment that I am offering cover a continuing worsening refugee situa- tion. camps K1 to K7 are to be consolidated at Mae with the gentleman from California The map shows the estimated refugee pop- Ra Ma Luang (K7). For the time being all [Mr. ROHRABACHER] will increase the ulation at the end of February as 88,907, an other camps will remain as before. migration and refugee assistance fund increase of 12,000 or 15 percent since Decem- The consolidation of camps K8 to K14 has by $1 million to alleviate the refugee ber. During March numbers have continued started (see map) and Mae La will eventually crisis on the Thai-Burma border. In to increase and could now have reached house a population of over 20,000. This has keeping with budgetary guidelines, the 95,000. Most of the new arrivals are in the two implications for the relief agencies. Firstly we have been faced with unbudgeted increase in funding is offset by cuts to northern area, camps K1 to K6. Currently there is still military activity around the expenses moving the refugees and establish- the Economic Support Fund. ing a new camp, and secondly the new town- The ramifications of the systematic KNU 6th and 4th Brigade areas and there is still the potential for a lot more refugees size camp will have different dynamics than repression conducted by Burma’s rul- from these areas if SLORC launches and all- the old village-size camps. We have already ing military junta, the State Law and out offensive. incurred costs in buying building materials Order Restoration Council or [SLORC], The situation remains very volatile and ex- because there is not enough available locally have created a refugee crisis along the tremely dangerous for both the refugees and and we will now also have to start providing Thai-Burma border that is worsening. NGO’s working for them. SLORC and Karen firewood. The Ministry of Interior will set up rebels continue to make intrusions into office in the camp but wishes to maintain The launching of a major SLORC the low key, self-support nature of the relief military offensive against the Karen Thailand, entering refugee camps, stealing rice, threatening, abducting and killing refu- activities as much as possible. The need for refugees this spring resulted in an out- gees. There is fear and panic and a small other support services however seems inevi- flow of an estimated additional 20,000 number of refugees (probably less than 2000) table. It is hoped to complete this consolida- refugees to Thailand bringing the popu- have returned to the Burma side. tion within a month although further moves lation to over 90,000. Most of the new refugees have arrived in have been temporarily suspended because of These new developments have serious very remote areas which will be cut-off by an outbreak of diarrhea resulting in at least implications for relief agencies. First, road as soon as the rains start. This is add- four deaths. they are faced with unbudgeted ex- ing to the normal burden of stockpiling sup- Although the order has already been issued for consolidating camps K1 to K7, heavy penses moving the refugees and estab- plies for the rainy season. The revised budget of U.S. $5 million is already 25% higher than rains could make this impractical until later lishing a new camp; and second, the 1994 but even this is based on a population of in the year. new town-size camp will have different only 90,000 and a rice price of $580. We are All of this has been taking place against a dynamics then the old village-size currently paying $700 per sack for these new background of speculation that the refugees camps. refugees. might soon start repatriating to Burma. The Burma Border Consortium The BBC is currently stretched to the This has been fuelled to some extent by the [BBC], the group of NGO’s responsible limit. There will be a critical cash/flow crisis fact that only about 50% of the refugees are for rice distribution and relief in the in April unless new funds arrive very soon, turning up at Mae La during the camp border camps, issued an appeal in and any further increase in numbers will ne- moves. Some are interpreting this to mean cessitate yet another increase in the budget. that the others have all chosen to go back to March for an increase of $5 million in It is difficult to estimate exact needs be- Burma, but there is no reliable information. their budget to cover the continuing cause many Donors have yet to indicate Some certainly have gone back but others worsening refugee situation. The BBC their proposed contributions for 1995. are probably hiding out elsewhere in Thai- anticipated that it would be stretched Present indications however suggest a short- land. There have also been continuing new June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6345 refugee arrivals mostly escaping vil- are urged to transfer funds as quickly as pos- about today, would not be confronting lage relocations and forced labour. sible to avoid further cash/flow problems, us. Unfortunately, what we have done The border situation is tense. SLORC and to provide cover for new emergencies. in these last 4 and 5 years is we have Further funding appeals/updates will be is- seems to have reverted to a hardline policy tried our best to try to romance the against all opposition and refugees tell of on- sued if and when the situation changes. JACK DUNFORD, SLORC regime. We have done our best, going human rights abuses throughout the and the gentleman from New Mexico border States. From our perspective there Burmese Border Consortium, seems little justification to claim, as some Chairman. has done heroic deeds in the cause of do, that the situation has ‘‘returned to nor- Mr. Chairman, the gentleman from democracy. Yet, trying to treat this mal’’. There could still be further offensives California [Mr. ROHRABACHER] and I dictatorship with kid gloves, trying to or incursions resulting in new refugee move- have had a long interest in this issue. move them along outside of the arena ments. Relations between SLORC and Thai- Let me say that we have met with the of tyranny has not worked. land are strained to the point that most bor- chairman of the subcommittee, who Today we are confronted with not der points are closed, construction on the has made a very, very strenuous effort only a monstrous repressive regime but ‘‘Friendship’’ bridge has been stopped, and refugees whose lives are in our hands both sides have been moving troops into bor- to ensure that there are adequate funds der areas. for this effort. today. I just stand in support of my col- The result of all of this for the BBC is that b we are facing additional expenditures be- 1615 league’s efforts and my colleague’s cause of the emergencies, and cannot rule Now, we have at this time $1.5 mil- amendment. out the possibility of new emergencies as the lion that are allocated for the Thai- Mr. CALLAHAN. Mr. Chairman, I year progresses. Even without emergencies Burma border for the refugee crisis. It move to strike the requisite number of the BBC budget has not increased to over is the understanding of myself and the words. US$6 million for this year: gentleman from California [Mr. Mr. Chairman, I congratulate the US$ ROHRABACHER] that the chairman will gentleman from New Mexico for bring- Food items ...... 4,750,000 ing to the attention of the House the Household items/medical ... 370,000 ensure that the funds that are in the Emergency items/transport 900,000 legislation, that are in the refugee and need for additional refugee assistance Administration ...... 180,000 migration account, will be moved over along the Thai-Burma border. so that there will be a total of $2.5 mil- The gentleman from New Mexico [Mr. Total ...... 6,200,000 lion for this amendment. RICHARDSON] as well as the gentleman Donor response has again been magnificent For that reason, Mr. Chairman, the from California [Mr. ROHRABACHER] and this budget is currently covered by pro- gentleman from California and I are have both been long interested in deal- jected income totalling US$6,311,100. considering withdrawing the amend- ing with this matter. I know they have US$ ment once we enter into a colloquy filed an amendment to add funds for ADRA ...... 4,000 with the chairman of the subcommit- refugee assistance in the area. I would Anonymous ...... 200,000 appreciate them withholding their American Baptist Min- tee. istries ...... 6,000 Mr. Chairman, let me just say that, amendment, however. In return, I Anglican Church of Canada 7,000 again, the reason that there is this re- pledge to them that we will work with Australian Churches of pression, that this is taking place on the State Department to ensure an ad- Christ ...... 3,600 the Thai-Burma border is we have a ditional $1 million is provided these Bangkok Community The- government called the SLORC, easily refugees. atre ...... 4,100 the most repressive of all time, that I know that $1.5 million has already Bread for World, Germany . 100,000 clearly is in a situation where because been allocated for this purpose, but we Burmese Relief Centre ...... 16,000 Burma Action Group, UK .. 3,000 of this repression they are increasing will monitor the situation to ensure CAFOD, UK ...... 20,000 the number of refugees along their bor- that these funds are spent for the pur- Christ Church Bangkok ..... 1,200 der. There are squalid, horrendous con- poses identified in the amendment. CARITAS Switzerland ...... 255,000 ditions on this border. The Thais do I would like to thank both of the gen- Christian Aid—UK ...... 159,000 not have the funds to adequately en- tlemen for their efforts in this regard Church World Service, USA 245,000 sure that they can deal with the refu- and for working with me and the com- Canadian Council of gee crisis. So what we are doing is, we mittee to resolve the problem. Churches ...... 180,000 Mr. RICHARDSON. Mr. Chairman, Compassion International . 6,400 are moving these funds and we are en- DIAKONIA, Sweden ...... 1 1,136,000 suring that there are adequate medical will the gentleman yield? DOEN, Netherlands ...... 1 15,000 facilities and that the United States, Mr. CALLAHAN. I yield to the gen- Dutch Interchurch Aid ...... 1 1,745,000 the State Department has not entirely tleman from New Mexico. International Church BKK 2,000 spent their budget on this effort. For Mr. RICHARDSON. Mr. Chairman, International Rescue Com- some reason, they have said in the let me commend the chairman and his mittee ...... 608,000 past, we do not need these funds. So staff for their excellent work on this Jesuit Refugee Service ...... 65,200 issue. The chairman is somebody who I Korean Church ...... 5,000 what the practical effect of this German Embassy ...... 55,500 amendment does is, it would move know is very concerned about this National C.Churches Aus- ahead with $2.5 million total for this issue. I just want to make it clear that tralia ...... 1 365.000 effort. based on what the chairman just said Norwegian Church Aid ...... 1 168,000 The CHAIRMAN. Does the gentleman to me in the colloquy, that in addition Open Society International 30,000 from Alabama [Mr. CALLAHAN] insist to the $1.5 million that are allocated Refugees International on his point of order? for the Thai-Burmese border, that the Japan ...... 35,000 chairman, through his very strong ef- 1 Mr. CALLAHAN. Mr. Chairman, I Swissaid ...... 290,000 forts as chairman of this subcommit- Trocaire ...... 1 23,000 withdraw my point of order. United Society Prop Gos- Mr. ROHRABACHER. Mr. Chairman, tee, will ensure that an additional $1 pel ...... 3,100 I move to strike the last word. million will flow to this account to ZOA Refugee Care Nether- Mr. Chairman, I would just like to make it a total of $1.5 million. Is that lands ...... 560,000 stand in support of my friend and col- an accurate statement? Interest/Misc ...... 4,000 league from New Mexico and every- Mr. CALLAHAN. Mr. Chairman, I 1 Part or all of these amounts have yet to be con- thing that he stated. I would just say cannot assure that, but I will assure firmed. that there is a tragedy, an ongoing the gentleman that I will do every- Funds from the Governments of Australia, tragedy in Burma. The people of the thing I can to ensure that it does take Canada, European Union, Germany, Great United States have historically stood place. Britain, Netherlands, Norway, Sweden, Swit- for freedom and democracy and if, in- Mr. RICHARDSON. Mr. Chairman, if zerland and USA are channelled through these Donors. deed, we would continue this stand in the gentleman will continue to yield, if Approximately US$3,650,000 has already Southeast Asia, many of the problems that is the case, the gentleman from been received but BBC is currently carrying that we face today, like this refugee New Mexico and I know my friend from no reserves. Donors still processing grants problem that is being expressed, talked California are satisfied. I do appreciate H 6346 CONGRESSIONAL RECORD — HOUSE June 27, 1995 the chairman’s word on this. We will, this is an excessive amount of money, priations, what in the world is AID as the gentleman knows, have another and it is a waste of taxpayers money. doing coming up with this kind of a amendment coming up on Burma which We here in the Congress of the United program? deals with the narcotics issue which we States have cut our staffs by 30 per- So finally, I would like to say that appreciate the chairman’s support. cent. I felt like we should be able to the chairman’s mark, although I did Mr. RICHARDSON. Mr. Chairman, I cut the AID staffs by 20 to 25 percent, not agree with it in the Committee on ask unanimous consent that the but we did not. We only cut them by 10 International Relations, did make a amendment be withdrawn. percent. Now we find that they are in- minor cut of 10 percent in the oper- The CHAIRMAN. Is there objection creasing in the foreign aid appropria- ational budget of AID. That is not to the request of the gentleman from tions bill by $29 million the operational enough. But most certainly, most cer- New Mexico? account. tainly we should not be increasing by There was no objection. I think that is a mistake. Let me just almost $30 million the $465 million that AMENDMENT OFFERED BY MR. BURTON OF point out some of the reasons why I was in the chairman’s mark at a time INDIANA think that is a mistake. when we are trying to cut expenses. Mr. BURTON of Indiana. Mr. Chair- I have here before me a message that My colleagues on the Committee on man, I offer an amendment. alludes to what the ambassador in Appropriations are going to come back The CHAIRMAN. The Clerk will des- Chad thinks about the AID program and say, we are cutting the appropria- ignate the amendment. over there. And the ambassador in tions by $400 million. That may be the The text of the amendment is as fol- Chad, according to this memo, said case. But here is 30 more million you lows: that this was expensive, an expensive can add to it because it is not needed. Amendment offered by Mr. BURTON of Indi- development program in Chad since the We certainly do not need to be spend- ana: Page 13, strike line 18 and all that fol- 1979 and 1981 wars, and that it had lit- ing this money. lows through page 14, line 11. tle impact. I submit to my colleagues that we Mr. BURTON of Indiana. Mr. Chair- This involves, I understand, $2- to should stick with the chairman’s mark. man, I ask unanimous consent that de- $300 million. And if you read further in It is a reasonable amount of money. It bate on this amendment and all amend- this memo, you find that the AID offi- will deal with the AID expenses ade- ments thereto be limited to 30 minutes, cer over there said, and I quote: With quately. It will take care of their per- 15 minutes on each side, proponents the exception of one other officer who sonnel and any people who are going to and opponents of the bill. leaves June 15, the remaining person- be cut or laid off because it has figured The CHAIRMAN. Is there objection nel will be occupied with the adminis- into it the amount of money it is going to request of the gentleman from Indi- tration of the closeout. And listen to to take to close out those people in ana? this, this is very important, our part- some of these offices around the world. There was no objection. ing gift of $4 million for Government So, I submit to my colleagues, sup- The CHAIRMAN. The gentleman officials’ salaries in Chad will have port my amendment. Cut AID by $29 from Indiana [Mr. BURTON] will be rec- been paid out to officials by the end of million, go back to the Committee on ognized for 15 minutes, and a Member the May. They were giving them a International Relations chairman’s in opposition will be recognized for 15 goodbye gift of $4 million. This is the mark. It is a reasonable figure. I urge minutes. AID administration. the support of my amendment. Mr. CALLAHAN. Mr. Chairman, I am This is a waste of taxpayers’ dollars. b opposed to the amendment. I also have in my possession an 1630 The CHAIRMAN. The gentleman amendment or a document that I read Mr. GILMAN. Mr. Chairman, will the from Alabama [Mr. CALLAHAN] will be several times before. This document gentleman yield? recognized for 15 minutes. was sent out by Sally Shelton, the sen- Mr. BURTON of Indiana. I yield to The Chair recognizes the gentleman ior staffer at the AID office. And this the gentleman from New York. from Indiana [Mr. BURTON]. went through their inner office memo Mr. GILMAN. Mr. Chairman, I rise in Mr. BURTON of Indiana. Mr. Chair- system throughout the world. She said, support of the Burton amendment. The man, I yield myself such time as I may Larry Byrne, the assistant adminis- amendment would cut the $29 million consume. trator for management at AID, an- supplementary add-on of AID’s operat- Mr. Chairman, when we had the nounced that AID was two-thirds or 62 ing expenses in a new reform and markup in the Committee on Inter- percent through this fiscal year, and downsizing account. While the purpose national Relations on AID, I became we have 38 percent of the dollar volume of the account is a good one, regret- very concerned because I thought that of procurement actions completed. We tably, the account was not authorized the cut in the operational budget was need to do $1.9 billion, that means in the Committee on International Re- not sufficient. The chairman’s mark spend $1.9 billion, in the next 5 months. lations bill. I support the amendment cut the overhead for AID by about 10 Byrne also said there are large pockets of the gentleman from Indiana [Mr. percent. I wanted to increase that cut of money in the field, so let’s get mov- BURTON] to keep control of spending in to about 20 to 25 percent. ing. this bill. I wanted to reduce the spending by What he was saying in essence was, Mr. BURTON of Indiana. Mr. Chair- $65 million. I brought an amendment to we want to spend this money before the man, I reserve the balance of my time. the floor of the House when the bill end of the fiscal year. Mr. CALLAHAN. Mr. Chairman, I reached the House floor, trying to cut Now, in addition to that, Mr. Chair- would like to allocate half of the time that $65 million, and my position did man, I would like to point out to my allocated to me to the gentleman from not prevail because it was agreed by colleagues what AID has been spending Texas [Mr. WILSON]. the majority of the House that we some of their money on. This is what is The CHAIRMAN. Without objection should stick with the chairman’s mark called a gender analysis tool kit. A the gentleman from Texas [Mr. WIL- of $465 million. gender analysis tool kit, it costs SON] will be recognized to control 71⁄2 I have talked to my colleagues on the $175,000. Nobody in this place really minutes. Committee on Appropriations and I knows what that thing is for. AID has There was no objection. was under the impression that they no business dealing with gender analy- Mr. CALLAHAN. Mr. Chairman, I agreed with the chairman’s mark on sis tool kits. They are supposed to help yield myself 31⁄2 minutes to speak in the foreign aid authorization bill as far developing countries with AID pro- opposition. as the operational costs were con- grams. And one of the subtitles, one of Mr. Chairman, the committee rec- cerned or the overhead was concerned. the booklets in this gender analysis ommendation truly does propose reduc- Now I find that the chairman of the tool kit says, sex and gender; what is tion of AID personnel and operations. subcommittee has agreed to increase the difference? A tool for examining We do not come into this issue ignoring above the chairman’s mark on the the sociocultural context of sex dif- the concerns that the gentleman from Committee on International Relations ferences. I would like to say to my col- Indiana has. In fact, we applaud his en- the figure by $29.9 million. In my view, leagues on the Committee on Appro- thusiasm toward attacking this agency June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6347 for some of their wasteful spending. Mr. CALLAHAN. Reclaiming my quest my colleagues to defeat this Heis exactly right in some areas. How- time, Mr. Chairman, where would we amendment. The fact that we spent ever, he is wrong here. get the information? Would we go ask $175,000 for gender analysis does not What his amendment is doing, is tak- someone on the street ‘‘How much mean that we have to cut them by $29.9 ing away from the ability of AID to would it cost to close down an office in million. downsize. The $29 million he is talking Ethiopia?’’ We do not know that an- Mr. WILSON. Mr. Chairman, I yield about was money we put into the bill swer. We have to depend upon the agen- myself such time as I may consume. specifically earmarked to AID to cy to tell us how much money they Mr. Chairman, there is not much downsize. If we take away this author- need to downsize. They told us that to more to say. It has all been said. This ity for them to downsize, I do not know downsize that is what it would be. is an amendment to cut $29 million how in the world they can downsize. Mr. BURTON of Indiana. Mr. Chair- from an account that has already been Mr. Chairman, an example is Radio man, I yield myself 30 seconds. cut by $52 million. The money is nec- Free Europe. They are in the process of Mr. Chairman, I would just like to essary for a businesslike, logical reducing staff in Munich from 1,500 to say to my dear friend, the gentleman downsizing, for it to be done in a way 400 employees, and moving to Prague from Alabama, that when you call a that exercises good business judg- in the Czech Republic. The cost of bureaucracy like AID, with which I ments. The people do have to be moved. downsizing is $130 million, more than have worked for 12 years, and ask them This reduction would particularly im- half the size of Radio Free Europe’s an- if they need more money for closing pact AID programs in Eastern Europe nual budget. down, we must expect they are going to and the former Soviet Union. We have AID has already cut staffing by 18 say ‘‘We need more money for closing already reduced those significantly. percent below the level that existed at down.’’ I just think that further reduction in the beginning of fiscal year 1994. The I have worked with this agency, like AID would impact children’s programs, total of $29,975,000 is being proposed for I said, for 12 years. I can tell the Mem- programs that are labor-intensive, but reform and downsizing activities. bers, no matter how much money we most of all, it would act as a deterrent The committee intends for the funds say they are going to cut, they say to a logical, rational downsizing ap- to be used as follows: $4.7 million for they need more. I am not saying my proach. severance pay, which we have to pay, colleagues are naive because they are Therefore, Mr. Chairman, I would ask for general services employees; $11.2 very intelligent people, but I do not my colleagues to vote against this million for the return home of direc- think we should rely on people from amendment. tors that are overseas, general service, AID. Mr. BURTON of Indiana. Mr. Chair- foreign service, and contractor employ- Mr. WILSON. Mr. Chairman, I yield 3 man, I yield 2 minutes to my colleague, ees, including moving expenses and em- minutes to the gentleman from Florida the gentleman from Indiana [Mr. ployee closeout costs; $12 million of the [Mr. JOHNSTON]. BUYER]. money must be used for mission clo- Mr. JOHNSTON of Florida. Mr. Mr. BUYER. Mr. Chairman, I thank sure costs, and foreign national sever- Chairman, I ask my colleagues to look the gentleman for yielding time to me. ance pay. I would like to make four points, Mr. We have entered into a contract with at this amendment very closely. This is Chairman. One is a special apprecia- these foreign nationals, who have amendment No. 57, and it is double-bar- tion to the chairman, the gentleman worked in conjunction with AID ef- reled. from Alabama [Mr. CALLAHAN], for the forts. Under contract with those coun- First, it takes away the downsizing good work he has done, along with the tries, we have to pay those employees account money, and as the chairman of new ranking member, the gentleman severance pay. I did not make that ar- the subcommittee said, this is going to from Texas. rangement. The United States of Amer- affect it all over the world. We closed The other point I would like to make ica made the arrangements. We are ob- about nine offices, six in Africa alone. is an appreciation to the chairman of ligated. We cannot just say ‘‘Well, Con- Of course, there are commitments the Committee on Rules, the gen- gressman BURTON said we could not there before you can close them about tleman from New York [Mr. SOLOMON], have the $29 million.’’ We have to pay leases and moving and things of that that money. nature. for making this amendment in order, Mr. Chairman, I concur in the sense It also affects our operation in Asia because in prior congresses it would be that we ought to be downsizing AID, and Latin America, but specifically Af- suspect whether it would be in order or but I do not concur in this amendment. rica. We have to give credit where cred- not. We already have downsized AID in our it is due. The second argument I would like to appropriation bill. We have acted re- Mr. BURTON of Indiana. Mr. Chair- make is an argument of process. We sponsibly, We have reached a bipartism man, will the gentleman yield? have proceded under the rules of the commitment between the minority Mr. JOHNSTON of Florida. I yield to House. We set up authorizing commit- side and the majority side. We recog- the gentleman from Indiana. tees and we set up appropriators. If we nize the concern of the committee that Mr. BURTON of Indiana. This is want to ignore the rules of the House the gentleman from Indiana [Mr. BUR- amendment No. 14, Mr. Chairman, I and need to do that, then let us get rid TON] so eloquently serves upon and would tell the gentleman. of the Committee on Appropriations speaks about. At the same time, I Mr. JOHNSTON of Florida. The same and put it all in one. We have done think we must be responsible. If we are premise, Mr. Chairman, to eliminate that. History has shown we have tried going to downsize, we have to give this. That is $30 million, which I think that before. them a van to close them out and to the committee very graciously put the What we have tried to do under this move them home. That is what this $29 money in there. I know from experi- Congress is to stop the sieve of the million does. It is earmarked specifi- ence, Mr. Chairman, and being in Afri- money. This is one of the experiences I cally for reduction in force. Mr. Chair- ca, being in Botswana, where the re- learned in the 103d Congress, was if you man, I would urge a ‘‘no’’ vote against gional office was closed, myself, with- did not get a project, if it was not au- the Burton amendment . out going to AID, the fact that is going thorized, or you did not get the amount Mr. BURTON of Indiana. Mr. Chair- to be a substantial amount of expense that you wanted from an authorizing man, will the gentleman yield? involved. committee, run off to the appropriators Mr. CALLAHAN. I yield to the gen- Mr. Chairman, in others areas of Af- and they will appropriate money that tleman from Indiana. rica, and particularly in the either was not authorized or is in ex- Mr. BURTON of Indiana. Mr. Chair- francophone countries where there are cess of the authorizing amount. If we man, I talked to the gentleman’s staff- leases involved, I think in that case we have monies here in excess of the au- ers in the Committee on Appropria- are going to have to give credit where thorizing amount, that should not be tions and asked them where they got credit is due in the fact that AID is made in order. However, it was made in the information. They told me they got doing an excellent job here. I just order. I understand that. Now we are the information the gentleman just think that by eliminating this fund, here on the House floor as a matter of quoted from AID officials. this is very shortsighted. I strongly re- process and procedure. H 6348 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Mr. Chairman, I appeal to the con- such as this throughout the entire 10 man, I am not accusing them of being sciences of my colleagues to support years I have known him, and I applaud liars, but I am saying they stretch the this amendment and to support the au- his efforts of bringing these matters, truth an awful lot. thorizing committees, and not to sup- such as this horrible box of informa- The chairman’s mark on the Com- port the appropriators spending money tion that AID has printed. I knew noth- mittee on International Relations was in excess of that which is authorized. ing about that. I think it is great that set at $465 million. That is a 10 percent The fourth point I would like to he brings these things to our attention. cut. make is that on substance. All of us However, the gentleman from Indi- Let me give a figure that will sur- are beginning to learn there are more ana [Mr. BURTON] also came to me and prise my friends on the Committee on and more, tons of studies out there ref- said ‘‘SONNY, we need to downsize. We Appropriations. Since 1985, AID’s pro- erencing AID. The Agency for Inter- need to reduce the AID staff. We need gram costs have gone down by 23 per- national Development has become a to bring home some of these people cent. The money they are spending for bureaucratic beast, a beast for which, from overseas.’’ I do not want anybody worthwhile projects has gone down 23 the gentleman from Texas [Mr. WIL- in this country or in this room or any- percent. At the same time that their SON] is smiling, he understands what it where in this city to think that I am costs for programs have gone down 23 is about. It is very difficult to rein in up here trying to increase aid for any- percent, they have increased their the excesses of that. I think the two body, much less AID. overhead by 41 percent. gentlemen working together are begin- Therefore, what we did in response to How can you cut the size of your pro- ning to do that, but I think that AID is the request of the gentleman from Indi- grams by 23 percent and at the same a bureaucratic beast which Reagan ana, we went to AID and said ‘‘We are time increase the number of personnel could not reform, Bush could not re- going to force you to downsize. We are and the overhead by 41 percent? It is form, and President Clinton is having a going to include $29 million in this bill, obvious there is inefficiency in that very difficult time reforming. I think and we are going to say that you can agency, major inefficiency. That is why the chairman’s mark on this House is going to have to take the only use this, and you must use this, to the Committee on International Rela- leadership to reform it. Please support downsize your operation, because the tions cut them back to $465 million. I Congress of the United States is de- the Burton amendment. came to your office and wanted to cut Mr. WILSON. Mr. Chairman, I yield manding it.’’ What we did was a re- it back to $400 million or less, but it back the balance of my time. sponsible thing. We provided them with could not be done, according to the Mr. CALLAHAN. Mr. Chairman, I a moving van to bring these people people on the staff of the Committee on yield 2 minutes to the gentlewoman home, with an opportunity to pay the Appropriations. from Maryland [Mrs. MORELLA]. severance pay when necessary in these Now you are coming back and saying Mrs. MORELLA. Mr. Chairman, I foreign countries, not to just walk out you want to increase it by $29 million thank the gentleman for yielding time of there and have us have to come back over the chairman’s mark on the au- to me. next year and ask for even more thorization committee. I just do not Mr. Chairman, I rise in opposition to money. understand that. When you say the rea- the gentleman’s amendment. Therefore, Mr. Chairman, I felt when son that you are increasing it by al- AID is already in the process of I got with the minority and when I got most $30 million is because, quote, AID downsizing and restructuring. Hiring with the subcommittee’s ranking mem- says they need the money to close has been frozen for almost two years, ber, the gentleman from Texas, and we down, what evidence do you have ex- and will continue through fiscal year worked this out, I insisted that the cept their word? 1996. Twenty-one AID missions are wishes of the gentleman from Indiana Mr. Chairman, if you went to any being closed. The national performance [Mr. BURTON] be fulfilled; that we send single bureaucracy within the jurisdic- review eliminated 1,200 jobs, and the a strong message to AID, and that at tion of the Congress of the United authorization passed several weeks ago the same time, we afford them the op- States, any one of them, they would will reduce staff by another 400. These portunity by the $29,000,000 that we put tell you they need more money for actions already underway represent a in there, especially earmarked, cannot closing down or downsizing. The fact of 20-percent personnel cut. be used for anything else, that we were the matter is the only way you are Further reduction of AID funding doing a service to the gentleman from going to cut those bureaucracies is to will impede management and oversight Indiana, I thought. say, ‘‘Hey, we’re cutting you by 10 per- of the taxpayer’s money and the pro- Now he comes and says he wants to cent. You figure out how to do it.’’ grams which it funds. It will also in- remove the $29 million. If we do not If one were in any business, and I crease job losses and complicate AID’s give them the $29 million, how are we know the gentleman from Alabama was efforts to transition to a smaller, more going to downsize? a businessman before he came to Con- streamlined agency while still main- gress, if you have to cut your overhead b 1645 taining itself as a coherent and ac- or go in the red and go bankrupt, you countable institution. I think that we have done the respon- would call your staff in, you would call Even without this amendment, the sible thing. I urge Members to vote your board of directors in and you bill is $14 million short of the amount ‘‘no’’ on the Burton amendment. would say, ‘‘Hey, how do we get from AID says it needs to carry out its mis- Mr. BURTON of Indiana. Mr. Chair- here to there? How do we cut the sion while downsizing and streamlining man, I yield myself such time as I may spending?’’ And you would say, ‘‘We’ve its programs and personnel. Further consume. got to do it or we go bankrupt,’’ and cuts will only complicate and disrupt Mr. Chairman, the other body, the they would figure out a way to do it. this process. authorizing committee over there was Mr. Chairman, the AID bureaucrats Mr. Chairman, I urge Members to op- below the chairman’s mark in the will figure out how to live without this pose the amendment. House by $33 or $34 million, so you have $30 million. We are telling the tax- Mr. CALLAHAN. Mr. Chairman, I two of the authorizing committees that payers of this country they are going yield myself such time as I may are well below the figure that the ap- to have to do with less. We are cutting consume. propriators are coming up with here programs, domestic programs, left and Mr. Chairman, let us get the facts today. right. Now here we have a chance to out here. Let us stop and reflect on The thing that bothers me the most stick with the chairman’s mark on the where we are. First of all, Mr. Chair- is not that my colleagues are not well- Committee on International Relations, man, the authorizing committee au- intentioned. I have the highest respect and you are telling me you want to go thorized a sum of $465,750,000. The ap- for both the gentleman from Texas $30 million above it? I do not buy it. propriations subcommittee and the full [Mr. WILSON] and the gentleman from I hope my colleagues in this body committee recommended the exact Alabama [Mr. CALLAHAN], but my prob- will see fit to live within the chair- same amount. lem is that they are believing the peo- man’s mark on the Committee on The gentleman from Indiana [Mr. ple over at AID. I have worked with International Relations, save $30 mil- BURTON] has so eloquently found issues those people for 12 years. Mr. Chair- lion, live within the budget, do the June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6349 right thing and save the taxpayers Hobson McInnis Schiff Thompson Vucanovich Wise money. I absolutely guarantee, AID Hoekstra McIntosh Seastrand Thornton Walsh Wolf Hoke McKeon Sensenbrenner Torres Ward Woolsey will be able to live with it. Holden Meehan Shadegg Towns Waters Wyden Mr. ROTH. Mr. Chairman, this is a very im- Horn Metcalf Shaw Tucker Watt (NC) Wynn portant amendment, for two reasons. Hostettler Meyers Shays Velazquez Waxman Yates Houghton Mica Vento Wicker First, it waves $30 million for the American Shuster Young (AK) Hunter Miller (FL) Skelton Visclosky Williams Young (FL) Volkmer Wilson taxpayer, by cutting out unnecessary funds for Hutchinson Minge Smith (MI) AID operating costs. Hyde Molinari Smith (NJ) NOT VOTING—14 Inglis Montgomery Smith (TX) Second, it sends a message to the bureauc- Istook Moorhead Camp Gutierrez Moakley Smith (WA) racy that business as usual is over. Let me Jacobs Myers Collins (MI) Jefferson Reynolds Solomon Johnson, Sam Myrick Ford Lantos Torricelli explain the legislative situation. Many of us in Souder Jones Neumann Furse Laughlin Zimmer Congress have been pressuring AID to Kanjorski Ney Stark Gunderson Mfume downsize. Kaptur Norwood Stearns It is a bloated bureaucracy, which is spend- Kasich Nussle Stenholm b 1709 ing $546 million for salaries, travel, office Kennedy (RI) Orton Stockman Kim Oxley Stump Mr. TUCKER changed his vote from space, and operating costs. That is more than King Parker Stupak ‘‘aye’’ to ‘‘no.’’ half a billion dollars to operate programs that Kingston Paxon Talent Mr. KLUG, Mr. DICKEY, and Mrs. total $6.5 billion. What is AID's response to Kleczka Peterson (MN) Tanner CUBIN changed their votes from ‘‘no’’ downsizing? They are demanding another $30 Klink Petri Tate to ‘‘aye.’’ Klug Pombo Tauzin million! Only in the Federal Government does LaHood Portman Taylor (MS) So the amendment was agreed to. downsizing translate into spending more Largent Poshard Taylor (NC) The result of the vote was announced money, not less. Latham Pryce Thomas as above recorded. LaTourette Quillen Thornberry Everywhere else in America, downsizing AMENDMENT, AS MODIFIED, OFFERED BY MR. Lazio Quinn Thurman Leach Radanovich HALL OF OHIO means reducing in size, cutting costs and sav- Tiahrt Lewis (KY) Ramstad ing money. But not in Washington. This is why Torkildsen Mr. HALL of Ohio. Mr. Chairman, I Lincoln Regula Traficant the Burton amendment is so important. Linder Riggs offer an amendment, as modified. This amendment says that downsizing Lipinski Roberts Upton The CHAIRMAN. The Clerk will des- LoBiondo Roemer Waldholtz ignate the amendment, as modified. means spending less money, not more. It says Walker Longley Rogers The text of the amendment, as modi- to AID: reduce your operating costs, like the Lucas Rohrabacher Wamp rest of America. Vote for the amendment, Luther Ros-Lehtinen Watts (OK) fied, is as follows: save $30 million and tell AID to cut its costs. Manzullo Roth Weldon (FL) Amendment as modified, offered by Mr. Mr. BURTON of Indiana. Mr. Chair- Martini Royce Weldon (PA) HALL of Ohio: Page 7, strike line 18 and in- McCollum Salmon Weller sert the following: ‘‘CHILDREN AND DIS- man, I yield back the balance of my White McCrery Sanford EASE PROGRAMS FUND’’. time. McHale Scarborough Whitfield McHugh Schaefer Zeliff Page 7, line 23, strike ‘‘$484,000,000’’ and in- The CHAIRMAN. The question is on sert ‘‘$592,660,000’’. the amendment offered by the gen- NOES—182 Page 8, line 6, strike ‘‘and (7)’’ and insert tleman from Indiana [Mr. BURTON]. ‘‘(7) basic education programs, and (8)’’. Abercrombie Filner Menendez Page 8, line 16, strike ‘‘$669,000,000’’ and in- The question was taken; and the Ackerman Flake Miller (CA) Chairman announced that the noes ap- Andrews Foglietta Mineta sert ‘‘$655,000,000’’. peared to have it. Baesler Forbes Mink Page 14, line 22, strike ‘‘$2,326,700,000’’ and Baker (LA) Frank (MA) Mollohan insert ‘‘$2,300,000,000’’. RECORDED VOTE Baldacci Franks (CT) Moran Page 30, line 17, strike ‘‘$167,960,000’’ and Mr. BURTON of Indiana. Mr. Chair- Bateman Frelinghuysen Morella insert ‘‘$100,000,000’’. man, I demand a recorded vote. Becerra Frost Murtha Beilenson Gejdenson Nadler Mr. CALLAHAN. Mr. Chairman, A recorded vote was ordered. Bentsen Gephardt Neal would the gentleman from Ohio [Mr. The vote was taken by electronic de- Berman Gibbons Nethercutt HALL] yield for a unanimous-consent vice, and there were—ayes 238, noes 182, Bishop Gonzalez Oberstar request? Bliley Hall (OH) Obey not voting 14, as follows: Bonilla Hamilton Olver Mr. HALL of Ohio. I am glad to yield [Roll No. 423] Bonior Hansen Ortiz to the gentleman from Alabama [Mr. Borski Harman Owens CALLAHAN]. AYES—238 Boucher Hastings (FL) Packard Allard Chenoweth Fawell Brown (CA) Hefner Pallone Mr. CALLAHAN. Mr. Chairman, Archer Christensen Fields (LA) Brown (FL) Hilliard Pastor would the gentleman object to placing Armey Chrysler Fields (TX) Brown (OH) Hinchey Payne (NJ) a 1-hour time debate on this with the Bachus Coble Flanagan Bryant (TX) Hoyer Payne (VA) time equally divided? Baker (CA) Coburn Foley Bunn Jackson-Lee Pelosi Ballenger Collins (GA) Fowler Callahan Johnson (CT) Peterson (FL) Mr. HALL of Ohio. Mr. Chairman, I Barcia Combest Fox Cardin Johnson (SD) Pickett would not object. Barr Condit Franks (NJ) Clay Johnson, E. B. Pomeroy Ms. SLAUGHTER. Mr. Chairman, re- Barrett (NE) Cooley Frisa Clayton Johnston Porter serving the right to object, I object, Barrett (WI) Costello Funderburk Clement Kelly Rahall Bartlett Cox Gallegly Clinger Kennedy (MA) Rangel really, on the grounds that this is a Barton Cramer Ganske Clyburn Kennelly Reed very important amendment and it has Bass Crane Gekas Coleman Kildee Richardson just come to my attention. Bereuter Crapo Geren Collins (IL) Knollenberg Rivers Bevill Cremeans Gilchrest Conyers Kolbe Rose The CHAIRMAN. The gentlewoman Bilbray Cubin Gillmor Coyne LaFalce Roukema from New York objects. Bilirakis Cunningham Gilman Davis Levin Roybal-Allard Mr. CALLAHAN. Mr. Chairman, if Blute Danner Goodlatte de la Garza Lewis (CA) Rush the gentlewoman will yield, will the Boehlert Deal Goodling DeLauro Lewis (GA) Sabo Boehner DeFazio Gordon DeLay Lightfoot Sanders gentlewoman agree to any time limita- Bono Diaz-Balart Goss Dellums Livingston Sawyer tion? Brewster Dickey Graham Deutsch Lofgren Saxton Ms. SLAUGHTER. Mr. Chairman, I Browder Dooley Green Dicks Lowey Schroeder would object to a time limit on the Brownback Doolittle Greenwood Dingell Maloney Schumer Bryant (TN) Dornan Gutknecht Dixon Manton Scott grounds that this is a very important Bunning Doyle Hall (TX) Doggett Markey Serrano amendment and it has just come to my Burr Dreier Hancock Durbin Martinez Sisisky attention that the money from this Burton Duncan Hastert Ehlers Mascara Skaggs Buyer Dunn Hastings (WA) Engel Matsui Skeen amendment is coming from family Calvert Edwards Hayes Eshoo McCarthy Slaughter planning. And we would like to have a Canady Ehrlich Hayworth Evans McDade Spence thorough discussion of it. Castle Emerson Hefley Everett McDermott Spratt Mr. CALLAHAN. Mr. Chairman, if Chabot English Heineman Farr McKinney Stokes Chambliss Ensign Herger Fattah McNulty Studds the gentlewoman will yield further, Chapman Ewing Hilleary Fazio Meek Tejeda would the gentlewoman object to any H 6350 CONGRESSIONAL RECORD — HOUSE June 27, 1995 time limit so that we could give the We are at an extremely critical junc- about empowering women and that Members an opportunity to go and eat ture today. The World is watching the women should have the choice to de- or do whatever? But if we just had Congress. The World is watching our cide whether they are going to be pro- some time limitation, something rea- new leadership in Washington. We have ductive or reproductive, we are really sonable, I am willing to accept any- the chance to do the right thing for in- going at this by doing that, and I am thing the gentlewoman would like. nocent, destitute, and dying children. really very saddened by the gentle- Ms. SLAUGHTER. I regret, Mr. What I am asking for will cost no more man’s amendment. Chairman, I did not want to object, but than the total amount currently in the Because I would jump on it in a I wanted to make certain that every- foreign aid appropriations bill. What I minute except for the fact that it ap- body has the opportunity to discuss am asking for is for us to prioritize pears from the way I read it, it comes this. children by transferring $108.66 million right off of the area where we have al- ready made cuts but where we would be b 1715 from other accounts in this bill. These accounts are simply not as important funding our family planning programs. The CHAIRMAN. The gentleman as saving and improving the lives of Mr. HALL of Ohio. The area that you from Ohio [Mr. HALL] is recognized for millions of starving children who have are talking about is the development 5 minutes. assistance account. I do take $14 mil- Mr. HALL of Ohio. Mr. Chairman, absolutely no hope of a whole life. We have made progress toward the lion out of there. I take $67 million out this amendment, known as the ‘‘Chil- goals that President Bush agreed to. It of the Asian development bank of dren’s Amendment’’, is being intro- which I can explain a little bit later. I duced by myself and my colleague, the would be a big mistake to end our com- mitment before we finish the job. I re- take approximately $26 million out of gentleman from New York [Mr. HOUGH- member some years ago saying that six ESF. TON]. The $14 million that I take out, in Our amendment transfers $108.66 mil- vaccine-preventable diseases such as measles and tetanus were killing 5 mil- my opinion, is minuscule in what I am lion from other foreign aid programs to trying to do, because what happened in ones that specifically save children. lion kids each year, and then 4 million. Now I am here to say that the same the last couple of years actually, before Our amendment is budget neutral. We 2 years ago, we had an account called preventable diseases are taking 2 mil- have found the enabling funds within basic education. In this complete bill lion lives a year. This is a legacy that other foreign aid programs including here, there is not a mention even in the Congress can be proud of. It is a legacy development assistance ($14 million), committee report of basic education. the economic support fund ($26.7 mil- our Congress should continue. Here is the legacy for Congress I Basic education goes for women and lion), and the Asian Development Fund children. It goes for the teaching of would like to see. It is a legacy where ($67.96 million). With all the cuts that breast feeding, the boiling of water, we stood up to the task of stopping 2 foreign aid has received in the last few teaching women and children how to million preventable child deaths next years, we must prioritize. We will save read and write. and improve millions of lives by mak- year. It is a legacy where we faced the I felt it necessary to take moneys out ing this transfer. fact that almost one-half of all rural of certain funds, put basic education in Mr. Chairman, 5 years ago, I attended women remain illiterate and more than the amendment and be sure at least the World Summit for Children in New 100 million children, mostly girls, are that basic education got its fair share. York. In New York, 159 world leaders, not in primary schools. Mrs. SCHROEDER. I understand including President George Bush, This amendment does not add one what the gentleman is saying. I just agreed to aim their nation’s foreign aid extra dollar to the appropriations bill am very, very saddened because pitting resources at a few practical and achiev- before us today. Mr. HOUGHTON and I mothers against children is not the able goals. We agreed to reduce child have provided modest cuts in other way I would go in this amendment. deaths by at least one-third, to reduce programs under this bill in order to That is how I read this amendment. maternal deaths and child malnutri- save these most precious children. I When you are going after a fund that tion by one half, and to provide all think the areas which we propose to has already been gone after, after the children access to basic education. slightly reduce—the Economic Support United States decided at the Cairo con- Many of you well know I have sought Fund, the Asian Development Fund, ference that if you worked really hard to champion these causes by ensuring and the General Development Ac- to empower women and children, I that the United States contributes its count—can sustain the cuts we have in think we are going the wrong way. fair share to the noble vision of the mind. Simply put, children come first. Mr. HOUGHTON. Mr. Chairman, I World Summit. Mr. Chairman, I am proud of the new move to strike the last word to speak Mr. Chairman, ever since 1984, when I protected Child Survival and Disease on the amendment. personally witnessed the unnecessary Programs Fund that the new leader- Mr. Chairman, I would like, if the deaths of over a dozen infants in Ethio- ship has created. Let’s put our very gentlewoman from Colorado would just pia, I cannot seem to rest until I feel limited dollars where they can really hold on a minute, I would like to get comfortable that we are doing all we make a difference. This is the kind of specifically to this issue that she talks can to avert such horrible tragedy. foreign aid the American people like. It about. Then I would like to talk on the These children, whom I held in my is the kind of foreign aid we can all be general amendment. arms, visit my conscience each and proud of, citizens and legislators alike. As I understand it, there are three every day. The CHAIRMAN. The time of the areas the money for this Houghton- As policy makers who work closely gentlemen from Ohio [Mr. HALL] has Hall amendment would come from. One with the programs that save these expired. of them is the economic development kids, AMO HOUGHTON and I have seen (On request of Mrs. SCHROEDER and assistance program. There are a vari- the incredible results products by fo- by unanimous consent, Mr. HALL of ety of areas in there. There is economic cussing on child survival and basic edu- Ohio was allowed to proceed for 2 addi- development. There is environmental cation programs. Millions and millions tional minutes.) development. There is the population of young girls, for instance, rarely Mrs. SCHROEDER. Mr. Chairman, issue. And then there is the basic edu- make it past the fifth grade and perpet- will the gentleman yield? cation. uate a cycle of poverty their families Mr. HALL of Ohio. I yield to the gen- In talking to the people in that spe- can never escape. tlewoman from Colorado. cific area, they said they were going to For each additional year of schooling Mrs. SCHROEDER. There is nothing I spend on basic education, this is out of these children receive, their incomes want to do more than agree with the a fund of $669 million, $14 million, so rise by 10 percent. By learning to read gentleman, but the way I read this is all we are doing is taking that $14 mil- and write and to take care of them- these cuts are coming out of the funds lion, making sure that it is spent for selves and their children, they cease that go to international family plan- basic education, not taking it out of being recipients of foreign aid and be- ning, too, and I am very troubled by anything else, so the remaining come instead economic players pur- that because as we just finished the amount of money is going to be spent chasing America goods. Cairo conference, where we talked exactly as it was before. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6351 Mrs. SCHROEDER. Mr. Chairman, Mrs. SCHROEDER. Except, if the see starving children and know that we will the gentleman yield? gentleman would yield further, you are could have done something about that Mr. HOUGHTON. I yield to the gen- still lowering it by $14 million, and it by sending them food or medicine. tlewoman from Colorado. has got to either come out of family b 1730 Mrs. SCHROEDER. Now, my under- planning or environment. standing is that really because of an Mr. HOUGHTON. It lowers it in a So, out of deference to the gentleman amendment we passed, did we not total sense. In terms of a practical al- from Ohio [Mr. HALL] and others we change that $669 million? Did not the location, it does not affect those other created a new account called the child gentleman from New York [Mr. GIL- three categories, because they were survival account, and in the child sur- MAN] lower that figure? I mean, we going to spend $14 million anyway out vival account we said to the adminis- have already tapped into that fund of the $669 million. tration, ‘‘You must take this money, once. Mrs. SCHROEDER. So you are saying and you must spend it on needy chil- Mr. HOUGHTON. It was $840 million. you lower it by that and transfer it to dren throughout the world.’’ Now it is $669 million. another category? I say to the gentleman, I thought I Mrs. SCHROEDER. Now it is down to Mr. HOUGHTON. Transfer what al- was doing exactly what you wanted me $669 million? I thought it was lower ready we spent to another category, to to do. than that. It has already been cut quite make sure that small amount of money Mr. Chairman, I am proud of the fact a bit. of the $669 million is going to be spent that this Congress and this committee Mr. HOUGHTON. It has already been on basic education. has brought to this floor a measure cut. None of us are particularly happy Mrs. SCHROEDER. If the gentleman that still reduces dramatically foreign about that, but with the amount of would yield further, I understand what aid, but at the same time prioritizes money remaining, the basic education, the gentleman is saying. That makes the use of what limited amounts of according to the people who are run- me feel better. I do not see where it money we will have for child survival ning the program, would be $14 million. says that in the amendment, and I am needs, and now I see the gentleman All we are doing is taking that out. terribly frightened they would take the comes and says that, ‘‘You want to also That would not have affected the popu- $14 million out of there. increase the child survival account, in- lation or environment or economic de- Mr. HOUGHTON. It probably does crease it by taking away $126 million velopment funds anyway. from the Development Assistance Mrs. SCHROEDER. If the gentleman not, but this is according to the people Fund, $68 million from the Asian De- will yield further, then what I hear the who would be allocating and spending velopment Fund, and $17 million from gentleman saying is that my interpre- the money. the Economic Support Fund to do tation is incorrect, that you are not I think I am sort of running out of something for basic education for going to touch the funds? the 5 minutes, but I thank the gentle- Mr. HOUGHTON. We will not touch woman very much. adults.’’ the population or environment or eco- I would like to say in conclusion that The child survival program was in- nomic development funds. We will not I support what the gentleman from tended, and is intended, and is in my even touch the basic education. The Ohio [Mr. HALL] is doing. I respect him. bill because I was concerned, and I problem is that with taking any I think it makes a lot of sense. thought the gentleman was just as con- amount of money out of any one of The agony is when you shift funds at cerned about children of the world and these categories, we are going to be all. Absent that, this would be an abso- need immunization, who need basic separating those amounts of money, lute no-brainer. foods, we need a survival capacity that the $14 million, putting it in a different But I think it is the right thing to the United States of America can de- category, but the same amount of do, and I can give you chapter and liver in the form of food and medicine, money would have been spent, in any verse out of my own experience, and I and now we are saying that we also event. hope this will be supported. want the child survival account to edu- Mrs. SCHROEDER. If the gentleman Mr. CALLAHAN. Mr. Chairman, I cate adults in some countries. will yield further, the way the gentle- move to strike the requisite number of I think that we do need to help edu- man’s amendment is written, it does words. cate some adults in other countries. I not say that. It takes it out of the top Mr. Chairman, I want to start off by think we need to help educate some number, so you could take it out of en- saying how much respect I have for the adults in this country. But I do not vironment and you could take it out of gentleman from Ohio [Mr. HALL] and think that we ought to violate the family planning, the way I read it. for many of the causes that he has been child survival account by now includ- Mr. HALL of Ohio. Mr. Chairman, behind, especially with respect to hu- ing a mishmash of things by saying will the gentleman yield? manitarian rights and to starving chil- that we ought to also take money from Mr. HOUGHTON. I yield to the gen- dren, and I would like, as soon as he other accounts, put it in my child sur- tleman from Ohio. can, for him to give me his attention, vival account, and start educating peo- Mr. HALL of Ohio. I would just like because I want to direct part of my ple through basic adult education. to add, what we are doing is basic edu- talk to him. I say to my colleague, If you wanted cation could be funded out of the devel- I want the gentleman from Ohio [Mr. to do that, I think that you should opment assistance fund to the tune, be- HALL] to know that the American peo- have come with an amendment, not put cause there is $669 million; what I am ple gave us a strong message last No- it in the child survival account, not doing is freeing up the fund of basic vember. They told us they wanted us to even renamed the child survival ac- education and transferring $108 million come to Washington, and they wanted count. I don’t think you should have into the children’s account and saying us to cut spending, and they told us at done that, but that’s the gentleman’s spend the basic education money in the same time they wanted us to re- prerogative, but I would assure you, that account. duce everything. They did not say, cut by, first of all, taking away from the Mr. HOUGHTON. Reclaiming my everything but spending on foreign aid. Asian Development Fund, you are cost- time, just let me go for the basic num- They said cut foreign aid. ing thousands of possible exporting job bers. It was $840 million for this entire During this process, I, like you, have situations here in the United States be- category with four subsections. It is been concerned about the children of cause the Asian Development Fund is now $669 million. We want to bring it the world who are destitute and starv- utilized to make things better for peo- down to $665 million. ing and who need immunization pro- ple and to give them a monetary possi- The only change is that the money grams, and out of respect for you, I bility to develop the underdeveloped which already would have been spent in came to you and I said we must do one countries of Asia. that $669 million, the $14 million, is thing, if we are going to reduce foreign So, as my colleague knows, he has going to be pushed aside to make sure aid, which we are going to do, then we got me almost lost because when he it is spent on basic education. None of must protect the number one priority, came to my office there was nothing, the rest of the moneys, according to and that is the children., We did not there was no assurance, that the Unit- their plan, would be affected at all. want to look at the television set and ed States would do exactly what he has H 6352 CONGRESSIONAL RECORD — HOUSE June 27, 1995 been wanting to do ever since the day this for children, for child survival ac- 10 percent contemplated by this I first met him, and that is to provide tivities, basic nutrients, AIDS, amendment. a capability to feed starving children UNICEF, immunization kinds of pro- I think that the decision made by and to provide immunizations, and now grams, ORT and et cetera. this House last week on the overall size he is coming and saying, ‘‘Let’s expand The gentleman added seven cat- of the combined development assist- the child survival account. Let’s also egories. I added another one. I made 8, ance account, which at that time in- put this itinerary here where we are and I add basic education because the cluded the Child Survival Fund, should going to increase the possibility of gentleman forgot to include that, and likewise be upheld. Also, as a strong America spending money to educate we have funded basic education for supporter of family planning programs, adults in foreign countries.’’ years here to teach mothers about nu- I urge a ‘‘no’’ vote. Mr. Chairman, the American people trition, to teach mothers reading and Furthermore, the Appropriations do not want that. I do not want it in writing, to teach mothers about breast Committee has looked at the subdivi- my bill. That is not the intent of the feeding, and boiling water and those sion of funds between the Child Sur- section that I included. My intent was kinds of things that eventually not vival Program, on the one hand, and to make absolutely certain that we only bring down the populations the development assistance account, on would prioritize what limited amounts through the studies we have, but in- the other, and made a recommendation of money we are going to have avail- crease the gross national product. to this House. They have also taken a able in 1996 for child survival, not adult Mr. Chairman, we only have so much hard look at the Asian Development education. resources, and I am saying, and some of Fund, and recommended support for it. So, I strongly oppose the amend- us are saying, that this is the best Mr. Chairman, we need to keep long- ment, and I would ask my colleagues to money that we spend overseas. It is term development in mind, as well as recognize the purpose of the child sur- spent on child survivor activities, the pressing needs of individuals who vival section in my bill, and that is women and children. We get more mile- are in need of immediate assistance. child survival. age out of this. The Appropriations Committee has Mr. HALL of Ohio. Mr. Chairman, I As I said in my opening statement, made a reasonable decision, and I think move to strike the last word. years ago 5 million children were we should not overturn it. The CHAIRMAN. Without objection dying. Because of our efforts, then it To further clarify, this amendment the Chair recognizes the gentleman was 4 million, then it was 3 million. would transfer $14 million from the from Ohio for 5 minutes. Now is down to 2 million. We made overall development assistance ac- Mr. HALL of Ohio. Mr. Chairman, I that goal, and we have something to count to Child Survival. Simply put, it appreciate everything the gentleman look forward to. We could end it, and would mean that there would be fewer from Alabama [Mr. CALLAHAN] has we end it by these programs, and that funds for family planning activities, said. He is a very distinguished gen- is why I am saying we only have so among others, out of the development tleman. I have had a number of talks much money, we must prioritize. assistance account. with him about this. He is very much I say, I say, put the money here. Accordingly, I urge my colleagues to of a gentleman, and I appreciate the Mr. GILMAN. Mr. Chairman, I move oppose the Hall amendment. kind of constraints that he is under. to strike the requisite number of Mr. WARD. Mr. Chairman, I move to But I must tell my colleagues I can re- words. strike the requisite number of words. member debating this bill when this (Mr. GILMAN asked and was given Mr. Chairman, I rise to speak in bill was around $20 billion, and then $18 permission to revise and extend his re- favor of the Houghton-Hall amend- billion, and now it is at a little bit marks.) ment, and I am glad to speak in favor under $12 billion for foreign operations. Mr. GILMAN. Mr. Chairman, I reluc- of a bipartisan effort to make this bill We have cut this bill since 1985 by 40 tantly rise in opposition to the amend- better. percent, and it is interesting. I say to ment offered by my good friends, the I have listened to the debate, and of- my colleagues: As you ask people in gentleman from Ohio [Mr. HALL] and tentimes we cannot say that in this the country about the kinds of pro- the gentleman from New York [Mr. body, that we have been in the room grams that I’m talking about, child HOUGHTON]. and we have listened to the debate, but survival activities, they believe in this. I must agree with the arguments I have had the opportunity, since com- But it is also they did a poll in the made by the manager of the bill, the ing over to participate in it, to listen United States, and they asked people chairman of the subcommittee, Mr. from the beginning, and I heard the what portion of the Federal budget CALLAHAN. concerns, Mr. Chairman, expressed should go to foreign aid, and most peo- The amendment would cut the devel- about the family planning money, and ple thought that the portion of the opment assistance account by $14 mil- I, too, am very concerned about that. Federal budget that went to foreign aid lion and the Economic Support Fund I did make the effort and had the op- was around 18 percent. That was the by $27 million as part of its effort to portunity to talk to the sponsors of average. Then they asked the Amer- provide additional funds for the Child this amendment, to other Members ican people, ‘‘What percentage do you Survival and Disease Fund. In addition, who are deeply involved in this amend- think it should be?’’ The average guess it would cut the Asian Development ment and to professional staff, and was, the average what they thought Fund by $68 million. have been assured by them that this was right, was 8 percent. The Economic Support Fund con- will not cause a reduction in family Well, the fact is that this is 1 percent tains, apart from any funds intended planning spending because we should actually of our total Federal budget. It for Israel and Egypt, only about $250 not cause a reduction in family plan- is less than 1 percent of what we are million for economic political support ning spending, but by the same token talking about today. for the entire world. With these funds we do need at the same time, we do I applaud what the gentleman has we provide assistance to Jordan, Leb- need to increase spending on education done in putting a parentheses around anon, on the West Bank and in Gaza, to through these programs. Only through child survival activities. That is the developing democracies in Africa, Asia, education can we achieve true freedom only part I like about the bill because and in Latin America. When we passed around this world. Only through basic the other part in development assist- H.R. 1561 less than 3 weeks ago, we education and basic skills training, as ance has been cut by 40 percent, aid to made prudent cuts so that this pro- the gentleman from Ohio [Mr. HALL] Africa has been cut by 34 percent, and gram will be funded below last year’s has spoken of, can we achieve true free- there are a lot of programs in there level and below the President’s request. dom for all citizens of this world be- that ought to be in there that are not But there must be a limit. We must cause only through education do people in there. But the one good thing that I provide the President with some assist- have the opportunity to have more believe that the gentleman did is the ance tool with which to attempt to control over their lives, whether it is parentheses, the special category for shore up our friends. We would be going through family planning or through children, and what the gentleman said, a long way toward tying the Presi- taking advantage of economic opportu- we are going to put so much money in dent’s hands if we cut it by the nearly nities. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6353 So, for those reasons, I speak in this need for impoverished developing nations Deutsch Jones Poshard strong favor of the Hall-Houghton Diaz-Balart Kanjorski Pryce throughout the world. And, because in many Dicks Kaptur Quinn amendment and praise the sponsor for of these nations access to basic education is Dingell Kasich Radanovich his work. I, too, have had the oppor- often not readily available, we must work to Dixon Kelly Rahall tunity of being in the Third World, of make it more available. Doggett Kennedy (MA) Ramstad seeing the conditions that bring rise to Doyle Kennedy (RI) Rangel Throwing good money after bad if we fail to Duncan Kennelly Reed these needs, of seeing the conditions target this money in the most cost-effective Durbin Kildee Regula that can be helped. way. Edwards Kleczka Richardson As the sponsor of the amendment Ehrlich Klink Riggs The other issue facing this amendment is Engel Klug said, we have seen a decrease in infant Rivers the funding question. First, the Hall-Houghton Ensign Kolbe Roemer mortality around the world. We need to amendment would transfer basic education Eshoo LaFalce Ros-Lehtinen continue that, and for that I applaud from the development assistance account to Evans Largent Roukema Farr LaTourette him and support the amendment. the child survival account. This is necessary Roybal-Allard Fattah Levin Rush Mrs. ROUKEMA. Mr. Chairman, I rise in because basic education is an important com- Fields (LA) Lewis (GA) Sabo strong support of the Hall/Houghton amend- ponent of child survival. If we lump it together Filner Lincoln Salmon ment and would like to particularly thank my Flake Lipinski Sanders with other development assistance such as Foglietta Lofgren good friend, the gentleman from Ohio for the Sanford population, environment, and economic growth Foley Longley Sawyer tremendous work and commitment he has put programs, there is a real possibility that basic Ford Lowey Saxton into this and other child survival issues for so education programs will lose out to these larg- Fowler Lucas Schaefer Frank (MA) Luther Schiff many years. er and more popular programs and this could Franks (NJ) Maloney Having had the privilege of serving as the Schroeder significantly impact our attempts to achieve Frisa Manton Scott first vice chairman of the former Select Com- substantial development. Frost Manzullo Seastrand mittee on Hunger, I had the honor of working Second, the amendment would transfer an Ganske Markey Sensenbrenner Gejdenson Martinez Serrano with then-chairman Mickey Leland and his additional $108 million from three other ac- Gephardt Martini Shays successor, Mr. HALL, to make important re- Geren Mascara counts to the child survival account to fund Sisisky Gibbons McCarthy forms in U.S. hunger policy and to make the basic education. Let me repeat, the amend- Skaggs Gilchrest McCollum public better aware of the plight of the hungry. Skelton ment is budget neutral and does not add fund- Gillmor McDade Slaughter Although the Select Committee on Hunger Gonzalez McDermott ing to the bill but rather finds offsetting spend- Smith (MI) which Mr. HALL chaired is gone, our obligation Goodlatte McHale ing reductions to support this fundingÐa criti- Smith (NJ) Goodling McHugh is not. As the wealthiest and most advanced Spratt cal distinction between this and other amend- Gordon McInnis Stark nation in the world, the globe's last remaining ments that might also be offered today. Goss McKeon Stenholm superpower, we continue to have a moral re- Graham McKinney This represents a proper order of priorities. Stokes Green McNulty sponsibility to help alleviate the problems re- Without basic education, we will limit efforts to Studds lated to hunger. Gutierrez Meek achieve progress in sustainable development, Gutknecht Menendez Stupak The Hall-Houghton amendment moves us and we will have less ability to make ad- Hall (OH) Miller (CA) Talent toward meeting that obligation. In essence, Hall (TX) Minge Tanner vances in agriculture, health, and other areas Tauzin ALL Harman Molinari Mr. H would reprogram $109 million from critical to economic and social progress. As Taylor (MS) the development assistance account to the Hastings (FL) Mollohan populations continue to grow throughout the Hayes Montgomery Thomas child survival account to be used for basic Hefley Moorhead Thompson world, we must make sure that these commu- Thornton educationÐprimary and secondary schooling nities at least receive the bare minimum of Hefner Moran and adult literacy and skills training. By provid- Heineman Murtha Thurman basic education so that they don't languish in Hilleary Nadler Tiahrt ing this level of education to children living in hunger and poverty forever. Such a small con- Hilliard Neal Towns developing countries we are taking a critical tribution on our part will reap innumerable Hinchey Nethercutt Traficant step toward ensuring sustainable development Hobson Neumann Tucker benefits in the future. Upton is successful. Hoekstra Oberstar Once again, I would like to congratulate my Hoke Olver Vento These programs are often carried out by two colleagues for their efforts on this issue Holden Ortiz Visclosky Volkmer NGO's [Non-Governmental Organizations] to and for bringing it to the attention of our other Horn Orton teach children how to read and write and Houghton Owens Waldholtz colleagues. I urge support for the Hall-Hough- Ward mothers the importance of cleanliness and hy- Hoyer Oxley ton amendment. Hunter Pallone Watt (NC) giene. The CHAIRMAN. The question is on Hutchinson Pastor Watts (OK) Hyde Payne (NJ) Weldon (FL) In recent years, Members of the House the amendment, as modified, offered by have continued to recognize the importance of Inglis Payne (VA) Weldon (PA) the gentleman from Ohio [Mr. HALL]. Jackson-Lee Pelosi Williams basic education as a means of advancing sus- The question was taken; and the Jacobs Peterson (FL) Wise tainable development throughout the world. By Jefferson Peterson (MN) Wolf Chairman announced that the noes ap- investing in basic skills, we are equipping im- Johnson (SD) Petri Woolsey peared to have it. Johnson, E. B. Pomeroy Wyden poverished children to become self-sufficient Johnston Portman Wynn as they grow older while giving them a better RECORDED VOTE understanding of how to utilize the resources Mr. HALL of Ohio. Mr. Chairman, I NOES—157 demand a recorded vote. around them so that their communities can Allard Burton Dunn prosper. Without a basic education, how can A recorded vote was ordered. Archer Buyer Ehlers we expect developing communities receiving The vote was taken by electronic de- Armey Callahan Emerson vice, and there were—ayes 263, noes 157, Bachus Calvert English U.S. assistance to most effectively use the Baker (CA) Castle Everett funds that we are providing and rise out of not voting 14, as follows: Baker (LA) Chambliss Ewing poverty? [Roll No. 424] Barr Chenoweth Fawell The question arises: what do we in the Unit- Barrett (NE) Christensen Fazio AYES—263 Barton Chrysler Flanagan ed States get out of this proposal? Abercrombie Borski Clyburn Bass Coble Forbes Simply put, basic education is an invaluable Ackerman Boucher Coburn Bateman Collins (GA) Fox investment for us because it is a necessary Andrews Brewster Coleman Bereuter Combest Franks (CT) Baesler Browder Collins (IL) Berman Cooley Frelinghuysen tool for sustaining long-term development. In Baldacci Brown (CA) Condit Bilbray Cox Funderburk many respects, it should be viewed as critical Ballenger Brown (FL) Conyers Bilirakis Crane Gallegly seed money by which children, their families, Barcia Brown (OH) Costello Bliley Cremeans Gekas their villages and eventually, whole economies Barrett (WI) Bryant (TX) Coyne Blute Cubin Gilman Bartlett Canady Cramer Boehner Cunningham Greenwood become more independent and self-sufficient. Becerra Cardin Crapo Bonilla Deal Hamilton Consequently, they will rely less on us for fu- Beilenson Chabot Danner Bono DeLay Hancock ture aid. Bentsen Chapman Davis Brownback Dickey Hansen Just as we recognize here in the United Bevill Clay de la Garza Bryant (TN) Dooley Hastert Bishop Clayton DeFazio Bunn Doolittle Hastings (WA) States the importance for every child to re- Boehlert Clement DeLauro Bunning Dornan Hayworth ceive an education, so too must we recognize Bonior Clinger Dellums Burr Dreier Herger H 6354 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Hostettler Mink Souder While I commend the efforts of my clear reactor in Cuba. So I think your Istook Morella Spence colleagues on the Committee on Appro- amendment misses the point. Johnson (CT) Myers Stearns Johnson, Sam Myrick Stockman priations for introducing a bill that re- And while I respect what you are try- Kim Ney Stump duces foreign aid by more than 10 per- ing to do and your colleagues in Flor- King Norwood Tate cent, I believe that we need to go fur- ida are trying to do, I hope you recog- Kingston Nussle Taylor (NC) ther. In this era of fiscal austerity for nize that your amendment is not doing Knollenberg Obey Tejeda LaHood Packard that. It is simply reducing aid to the Thornberry which every American has sacrificed, Latham Parker Torkildsen we cannot continue to subsidize Rus- independent states. There is nothing in Laughlin Paxon there to say that the reduced aid can- Lazio Pickett Torres sia’s aggressive behavior. Leach Pombo Velazquez This amendment will provide a warn- not be spent in Cuba. And while I do Lewis (CA) Porter Vucanovich ing to Russia to alter their policies or not support any of it being spent in Lewis (KY) Quillen Walker face further sanctions. We have got to Cuba, I think that your amendment Lightfoot Rogers Walsh Linder Rohrabacher Wamp let them know the United States will really does not truly address the ques- Livingston Roth Waters not stand for it, Congress will not tion. LoBiondo Royce Waxman stand for it, and the American tax- If you want to reduce aid to Russia, Matsui Scarborough Weller payer will not stand for it. we will reduce aid to Russia, but there McCrery Schumer White McIntosh Shadegg Whitfield Mr. CALLAHAN. Mr. Chairman, I is no provision in this bill that gives Meehan Shaw Wicker rise in opposition to the amendment. any aid to Russia anyway. So I recog- Metcalf Shuster Wilson Mr. Chairman, I understand and I nize what the gentleman is saying. I Meyers Skeen Young (AK) sympathize with the concern of the sympathize with the problem. I will do Mica Smith (TX) Young (FL) Miller (FL) gentleman from Florida and the other everything I can to absolutely send Smith (WA) Zeliff Mineta Solomon members of the Florida delegation whatever message to whatever coun- NOT VOTING—14 about the possibility of an unsafe nu- try, whether it be a newly independent clear reactor. Camp Lantos Rose state or any other country in the Collins (MI) Mfume Torricelli Mr. Chairman, I understand the con- world, that we do not want this to take Fields (TX) Moakley Yates cern of the Florida delegation and the place on our shores. I just do not think Furse Reynolds Zimmer gentleman from Florida with his that the amendment actually satisfies Gunderson Roberts amendment of reducing aid to the inde- what the gentleman is trying to do be- b 1804 pendent states of the former Soviet cause there is nothing to preclude Union. Mr. KIM and Mr. DICKEY changed them from doing it, if we are going to However, his amendment, in my give them aid anyway. their vote from ‘‘aye’’ to ‘‘no.’’ opinion, does not do what he seeks to Mr. FRANK of Massachusetts, Ms. do, and that is limit the ability of Rus- b 1815 ESHOO, Ms. ROYBAL-ALLARD, and sia to provide some type of capability Mr. OBEY. Mr. Chairman, I move to Messrs. DIXON, CLINGER, HILLEARY, to the Castro government in Cuba to strike the last word. and HOEKSTRA, Mrs. SEASTRAND, help them with a nuclear reactor. No Mr. Chairman, I take a back seat to and Messrs. DICKS, SMITH of Michi- one in this body that I know of sup- no one in the desire to save money on gan, and FLAKE changed their vote ports helping give Castro any ability to foreign assistance. During the years from ‘‘no’’ to ‘‘aye.’’ participate with Russia or any other that I chaired the subcommittee, the So the amendment was agreed to. country, Iran or any other country, to foreign aid bill for the United States The result of the vote was announced help them build a nuclear reactor, but was reduced from $18 billion to $13 bil- as above recorded. the gentleman’s amendment does not lion. I defy anyone to show me any AMENDMENT OFFERED BY MR. MILLER OF address that. The gentleman’s amend- other appropriation bill which was cut FLORIDA ment is just a symbol of what he is try- more deeply. Mr. MILLER of Florida. Mr. Chair- ing to do. I have in my possession, in fact I man, I offer an amendment. The amendment does not address spe- prize them, three letters from previous The CHAIRMAN. The Clerk will des- cifically what he wants to address, and administrations, the Reagan Adminis- ignate the amendment. that is whether or not Russia will be tration and the Bush Administration, The text of the amendment is as fol- diminished in the event that they fur- each telling me that they were plan- lows: nish aid, some type of assistance to ning to veto my bill because we did not Amendment offered by Mr. Miller of Flor- Cuba. We do not have special account spend enough money, so I take a back ida: Page 16, line 24, strike ‘‘$595,000,000’’ and aid, first of all, in this bill for Russia. seat to no one in my desire to see the insert ‘‘$565,000,000’’. So there is no money to cut. And even taxpayers’ money is spent judiciously Mr. MILLER of Florida. Mr. Chair- if we did have, it does not do that. It in this area. man, I am introducing this amendment simply says that we are going to take However, there is a price for partici- along with my colleague, the gentle- away money from the independent pation effective participation in the woman from Miami, FL [Ms. ROS- states, from the various independent world. When we do not pay that price, LEHTINEN], to reduce funding for Rus- states of the former Soviet Union. So we often pay a far higher price. If Mem- sia and the newly independent states what you are doing is, you are penaliz- bers question that, all they have to do by $30 million. This amendment will re- ing the Ukraine and Armenia and other is to take a look at what happened to duce funding for Russia and the newly areas of the independent states by your the world when the West essentially ig- independent states by $30 million. amendment because you simply just re- nored what was happening in the Wei- By passing this amendment, we can duce the amount of money that we had mar Republic after World War I in Ger- send a message to Moscow that Con- provided for the former independent many. A fellow by the name of Hitler gress will not continue to support a states. came to power because he exploited the government that disregards human So if you are going to address this fact we did nothing to ease the eco- rights at home and abroad. We need to issue, I think it should be more prop- nomic collapse in that country, and let Russia know that its egregious be- erly addressed in the Menendez amend- only 50 million people died, including a havior has not gone unnoticed. In ment, which has been put in order by good many Americans, so there is a Chechnya the Russian military has dis- the Committee on Rules and will an- price for participation in the world. I played a pattern of aggression that swer that question directly yes or no. would much rather it be financial than should not be ignored. But to just go ahead and reduce aid to human. In Bosnia, Russia supports the Ser- the independent states to send someone Mr. Chairman, I think it is a mistake bians who are engaged in brutal acts of a message, number one, it does not en- to cut aid to the Soviet Union, or the ethnic cleansing. And even closer to sure that the balance of the money will former Soviet Union, below the amount home in Cuba, they have assisted Fidel not be used by Russia or any of the in the administration’s request. I in Castro in maintaining his totalitarian independent states. They can take fact think it is a mistake to pass this reign over that nation. what is left, if they want to build a nu- amendment. Aid to the former Soviet June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6355 Union has already been reduced by 27 Mr. WILSON. Mr. Chairman, this Mr. LIVINGSTON. Mr. Chairman, is percent below last year’s level. This substitute merely reduces the amount an amendment to the amendment to cuts another $30 million. of the cut from $30 million to $15 mil- the amendment in order? Is that an Mr. Chairman, I would point out that lion. Mr. Chairman, I would ask the amendment in the third degree? two-thirds of this cut will not be ap- gentlewoman, is this acceptable? The CHAIRMAN. The amendment to plied to Russia. It will be applied to Ms. ROS-LEHTINEN. Mr. Chairman, the amendment offered as a substitute other former republics, such as Arme- will the gentleman yield? is not in the third degree and is in nia, Ukraine, countries that we would Mr. WILSON. I yield to the gentle- order. like very much to see maintain as woman from Florida. The gentleman from Colorado [Mr. much independence as possible. This Ms. ROS-LEHTINEN. Mr. Chairman, HEFLEY] is recognized for 5 minutes. amendment is going to make it more I would ask the gentleman, is this then Mr. HEFLEY. Mr. Chairman, I rise to difficult for them to sustain that inde- a $15 million cut from the same budget offer an amendment to the substitute pendence. item on the appropriations bill? It was which cut the appropriations to the I would also suggest this cut is going the 595, and the gentleman cut 15. former Soviet Union from $595 million to hurt the very people we are trying Mr. WILSON. Mr. Chairman, I would to $296.8 million. For those who have to help in Russia itself, the reformers say to the gentlewoman, yes. been talking about how the $30 million who want to see a market-based eco- Ms. ROS-LEHTINEN. If the gen- cut is too drastic, it is going to seem nomic system, and who want to see a tleman will continue to yield, Mr. very, very drastic. democratic political system. Chairman, I would ask, would the legis- The way we arrived at these figures I understand that this amendment is lative language be clear in our debate? is to look at last year’s. It is a little being offered by members of the Flor- We have tried to make sure that it is difficult to get at, because it is dif- ida delegation because they are un- understood that our intent is that Rus- ficult in the bill to know exactly where happy about the fact that Cuba began sia is the target of this. in 1983 (before the Communists fell I realize that the way that the bill is these dollars are going to go. However, from power in Russia) they began the drafted, and purposely and quite delib- the way we arrived at it was to look at construction of a nuclear power plant, erately, it is drafted in a way that it the expenditures last year, and some of financed partially by the former Soviet has to be taken out of Russia and all the programs that we thought were Union. the newly independent states. Would foolish expenditures, and subtract from However, I would point out that all the gentleman agree that the target in that. Russian aid stopped in 1992, when Rus- this would be Russia, and of course, it Mr. Chairman, I commend the gen- sia demanded hard currency payments is not up to us to determine this, I un- tleman from Alabama [Mr. CALLAHAN], from Cuba. I would point out that the derstand, in this bill? for his efforts in putting together a bill only subsidy from Russia since that Mr. WILSON. Mr. Chairman, I do not that is significantly better than the time was a $30 million credit to moth- think I can do this because of the way foreign operations bills of the past. The ball the plant, not to build it, but to this is drafted. It has to come from all gentleman has worked hard to focus mothball the plant. We want that plant of the newly independent states. American taxpayer dollars on regions mothballed! Ms. ROS-LEHTINEN. If the gen- that will most benefit from U.S. assist- Mr. Chairman, I would also make the tleman will continue to yield, that ance, and prioritize them according to point that the press has reported that would be a determination? our own national security interests. the Cubans would seek Western back- Mr. WILSON. We could discuss the The former Soviet Union is such a re- ers for that plant, but in fact the Wall language with the managers. I am un- gion. I agree with the committee’s Street Journal contacted the compa- able to make that commitment at this views that no relationship is more im- nies allegedly involved and they denied point. portant to the long-term security of any concrete intention to proceed. So Ms. ROS–LEHTINEN. Mr. Chairman, the United States than the strategic it seems to me shortsighted to deny $30 if I could further ask the gentleman to relationship with the former Soviet million aid to former Soviet Republics yield, that would be an acceptable cut, Union. If reform fails in the former So- because they provided $30 million to $15 million, from my perspective. I am viet Union, the potential of nuclear put the nuclear plant in mothballs. It a cosponsor with my colleague, the confrontation will increase greatly. seems to me that is exactly what we gentleman from Florida [Mr. MILLER], If I believe this to be true, how could want. No sane person, Russian or if we could ask him for his response on I stand here and promote slashing U.S. American, want to see that plant built. this. aid to the newly independent states? Therefore, it seems to me if we want Mr. MILLER of Florida. Mr. Chair- Let me tell the Members why, because to effectively oppose the construction man, will the gentleman yield? much of the aid we have given, and of any nuclear plant in Cuba that is Mr. WILSON. I yield to the gen- that which we will give again this year, not to our liking, what in fact we tleman from Florida. has been a total waste, I think, of tax- ought to be doing is to promote the po- Mr. MILLER of Florida. Mr. Chair- payer dollars. litical causes of the factions within man, I would find that acceptable, and When we think of the aid to the Russia who are most opposed to that, I would support the gentleman’s former Soviet Union, most of us think and other idiotic actions that some of amendment to my amendment. of humanitarian aid, or aid to promote the other factions would like to take. AMENDMENT OFFERED BY MR. HEFLEY AS A free market, or we think of strengthen- Mr. Chairman, I know it is very easy SUBSTITUTE FOR THE AMENDMENT OFFERED ing democracy there. However, when to come into this well and say ‘‘Let us BY MR. WILSON AS A SUBSTITUTE FOR THE we think of aid to the former Soviet AMENDMENT OFFERED BY MR. MILLER OF cut foreign aid.’’ As I say, we have cut Union, do we envision Planned Parent- FLORIDA it billions of dollars over the past few hood of Northern New England? That is Mr. HEFLEY. Mr. Chairman, I offer years. However, there are times when a right, Planned Parenthood of Northern an amendment as a substitute for the specific cut can be the wrong thing New England has received over $200,000 amendment offered as a substitute for from the standpoint of American inter- of these tax dollars to develop a Center ests, and this is such a time. the amendment. The Clerk read as follows: for the Formation of Sexual Culture in AMENDMENT OFFERED BY MR. WILSON AS A SUB- Russia. I do not know about the Mem- Amendment offered by Mr. HEFLEY as a STITUTE TO THE AMENDMENT OFFERED BY MR. bers, but that is not high on my list of MILLER OF FLORIDA substitute for the amendment offered by Mr. aid to the Soviet Union priorities. Mr. WILSON. Mr. Chairman, I offer WILSON as a substitute for the amendment an amendment as a substitute for the offered by Mr. MILLER of Florida: strike Mr. Chairman, we give money in- amendment. ‘‘$580,000,000’’ and insert ‘‘$296,800,000’’. tended to implement structural The Clerk read as follows: POINT OF ORDER changes in Russia, but instead some of Amendment offered by Mr. WILSON as a Mr. LIVINGSTON. I have a point of this money went to the Center of Love substitute for the amendment offered by Mr. order, Mr. Chairman. and Support, a program to teach em- MILLER of Florida: on page 16, line 24, delete The CHAIRMAN. The gentleman will ployees in Russian hospitals a good $595,000,000 and insert $580,000,000. state his point of order. bedside manner. I wonder how many H 6356 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Russian children could have been im- cause some day they might have the ever happens to you, just go ahead, munized with the $200,000 that was White House and we might be back in reassert your nationalistic, militaris- spent on that? the majority, and then they will have tic point of view on your neighbors, What bothers me most and should to talk to us about this. and we’re going to save our money.’’ bother all of us, I think, is the amount However, this amendment is drastic, I would say it is going to cost us a of money we are wasting in the so- it is extreme, it is an sleuth show-stop- heck of a lot more money changing called aid to the Soviet Union. Billions per, and Mr. Chairman, I would urge, this around when all hell breaks loose of the dollars we expended in the past urge, urge my colleagues to vote ‘‘no’’. in that part of the world. This amend- has not been wisely spent, much of it Mr. LIVINGSTON. Mr. Chairman, I ment is just not wise. because between 50 percent and 90 per- move to strike the last work. I want to take this opportunity to cent of the money in these aid pack- (Mr. LIVINGSTON asked and was say that I know that the gentleman ages has not reached the pockets of a given permission to revise and extend from Alabama [Mr. CALLAHAN] and the single pro-democracy, pro-market, pro- his remarks.) gentleman from Texas [Mr.WILSON] reform foreign citizen. have worked with the members of this b 1830 Instead, this money found its way subcommittee long, hard hours, with into the pockets of consultants and Mr. LIVINGSTON. Mr. Chairman, I the staff, to confect this bill. I know beltway bandits, and the going rate for move to strike the requisite number of that it is the objective of the majority a Western consultant to the former So- words, and I rise in opposition to this to allow as much of an open rule as viet Union is about $800 a day, and a lot amendment. possible, and allow all Members to of them are collecting on that rate. Mr. Chairman, if this amendment come forward to the well of the House My constituents are outraged, and I were adopted, frankly, it would knock and offer their amendments. think the gentleman’s are, too. I en- out a key component of a declining for- We have over 70 amendments to this courage my colleagues to support this eign aid budget. It would affect more bill. If we want to engage in the com- amendment to cut aid to the former than Russia. It would affect Armenia, mittee process, if it makes any sense Soviet Union. This amendment is in- Ukraine, and all of the independent whatsoever to try to develop some ex- tended to zero out many programs states that we are trying to assist in pertise and some coherent foreign pol- which are simply so inefficiently ad- achieving their independence from icy, then I hope that the Members ministered as to render them useless, Russia. It would, frankly, just destroy would have some reliance on the com- or are programs we do not need to be our foreign policy with respect to New mittee process and let it do its work. involved in, or are programs we simply Independent states of the former So- But if we want to just write all legis- do not have good accountability on. We viet Union. I think that is ill-advised. I lation on the floor of the House, fine. do not know where the money has just hope that the Members will vote We will just forget the committee proc- gone, and we do not know whether it is against it. ess. Let’s just do all of the business on being spent well or not. There is reason to be concerned the floor of the House, but be prepared Mr. Chairman, I would encourage about Russia, for example, their hard to work to midnight from now until support of this amendment. tactics against Chechnya, but a cease Christmas, and let’s forget about week- Mr. WILSON. Mr. Chairman, I rise in fire is in place and there are mediating ends. opposition to this amendment. talks between the Russian government This has just gone a little bit too far. Mr. Chairman, this is a massive, mas- and the Chechnyan separatists going This bill is a good bill, it is a balanced sive, massive cut. This would abso- on now. bill, and this amendment destroys the lutely wreck the entire program that The Gore-Chernomyrdin Commission balance and neglects the role and the the United States has built up. It is meeting this week to review the pro- objectives of the United States in would not only cause great hardship in posed sale of Russian nuclear reactors maintaining peace in the world. It is Russia and certainly put the brakes on to Iran, to ensure that no militarily ill-advised. It should be rejected. all the efforts toward privatization useful components are provided to Mr. CALLAHAN. Mr. Chairman, I there, but it would wreck the programs Iran. move to strike the requisite number of in the Ukraine, it would wreck the pro- With regard to NATO expansion into words. grams in Armenia, it would wreck the Eastern Europe, Russia has now joined Mr. Chairman, I also rise in opposi- programs in Georgia, and in my opin- NATO’s Partnership for peace program. tion to the Hefley amendment. My col- ion, it would completely diminish any Russia is fully supportive of U.N. leagues, I do not think there has been ability that the United States has to talks to end the conflict in Tajikistan. anyone in this House who was more op- affect any events that take place in the Russia has signed a framework agree- posed to the program that the adminis- former Soviet Union or in Russia itself. ment for the withdrawal of its 14th tration brought to this Congress in 1994 Mr. Chairman, I am surprised at the Army in Moldova. where the President had committed amendment offered by the gentleman Russia has recently reached impor- some $2.1 billion to the independent from Colorado [Mr. HEFLEY] because of tant agreements with Ukraine on divi- states of the former Soviet Union. I the drastic nature of it. It is a train sion of the Black Sea Fleet and basing rose and spoke against part of that aid wreck. It will destroy any possibility of of the fleet. It is reportedly moving to to Russia, although I was certainly in- any sort of bipartisan cooperation in settle a conflict that Georgia faces terested in seeing democracy prevail passing this bill on the floor. I do not with separatists in the region of there, but I never rose in support of have to tell the Members what the Abkhazia. cutting off moneys to the Ukraine or State Department or what the adminis- It has agreed that any peacekeeping Armenia or any of the other independ- tration feels. force in Azerbaijan will fall under ent states. Mr. Chairman, often during times OSCE supervision. It is moving towards Mr. Chairman, no one to my knowl- when Democrats ran the House and parliamentary elections this December edge, including me, rose to say they Senate and Republicans ran the White and presidential elections next June in were against aid to Ukraine. No one House, which has usually been the situ- Russia alone. rose and said we ought not to give ation since I have been in Congress, I It has withdrawn its troops from the money to Armenia or to Georgia, be- used to always have to remind my Baltic States, and it is ending its cause we want those countries to sur- Democratic colleagues when they had targeting of nuclear weapons on the vive, and we want them to understand amendments like this that would abso- United States. The days of the costly democracy, and we want the adminis- lutely wreck administration programs and dangerous cold war confrontation tration to have the ability to go to the that we ought to be a little careful and are hopefully over for good. independent states. a little moderate, because some day we The best way to turn that around is We are not talking about Russia as might have the White House. just to turn our back on Russia and much as we are the Ukraine and the I would like to remind my friends in say, ‘‘All your progress over these last other independent states. There is the majority that they ought to be a few years is all nice, but we’re just nothing in my bill that earmarks any little careful and a little moderate, be- going to walk away from you. What- money for Russia. As a matter of fact, June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6357 there is language in my bill that says Mr. CALLAHAN. I yield to the gen- choices are going to be presented to us. before they can spend any money in tleman from Colorado. We ask you to just trust us to do our Russia, they have to come back to the Mr. HEFLEY. I thank the gentleman best in a situation we’ve never experi- committees to get permission to do it, from Alabama [Mr. CALLAHAN] for enced before.’’ that we can sign off on. yielding. I have great respect for your It seemed to this subcommittee at No one has been stronger in vocal op- judgment in this. You are certainly that time to be a good bet, because we position to aid to Russia for silly more knowledgeable than I am. had literally spent trillions of dollars things like building houses for the re- It is not just the Ukraine that is get- to win the cold war, and we did win the tired military officers in Russia than I ting this money. Booz, Allen & Hamil- cold war. Now we are faced with a Rus- have. I have been the only one that ton is getting this money. Paine sian economy which is in shambles be- stood on this floor, to my knowledge, Webber is getting this money. Ernst & cause of the stupidity associated with and said anything about it. I did not Young is getting this money. the Communist system. So we are try- hear the gentleman from Colorado or Some of you speak as if I am cutting ing to work our way through both po- anybody else coming up and saying we the whole thing out. We still have $300 ought to not give aid to Ukraine or million in here. You say we have come litical reform and economic reform, Georgia or Armenia, and I did not say down a great deal, and we certainly not just in Russia but in some of the it. have since we started doing this, but is former captive nations. We have come from $2.1 billion. Last this something, do we take them to Now we are told that despite the fact year we gave them $842 million. This is raise forever? that that rebuilding job has barely not Russia. This is all of the independ- Is this something that is going to go begun, that we ought to take this bill ent states. The President came this on and on forever or are we going to and reduce aid to the former Soviet year, and he said, ‘‘Gentlemen, I need see the day when we are not putting Union by two-thirds from last year. As $788 million,’’ and I was the one who any money into the former Soviet the gentleman who chairs the sub- said we do not have that kind of Union? committee has indicated, that is an al- money, we are going to have to cut the Mr. OBEY. Mr. Chairman, I move to most three-quarters reduction from independent states just like we are cut- strike the requisite number of words, just 2 years ago. ting everybody else. and I rise in opposition to the amend- Mr. Chairman, I submit that what we The committee reduced it to $595 ment. are spending today is pennies in com- million, one-quarter of what we gave Mr. Chairman, I think we need to put parison to what we will have to spend them just 2 years ago. Now along in perspective what we are being asked if events go the wrong way in Russia comes the gentleman from Florida, and to do here. he recommends another $30 million, We have an awful lot of self-styled and the Ukraine and in other countries and now the gentleman from Texas has foreign policy experts, starting with in that region. worked out seemingly a compromise to people like Henry Kissinger himself You betcha there have been mis- reduce that to only $15 million, which and going right on down, who are say- takes. I have great respect for the gen- I am going to support. ing that we ought to extend our NATO tleman from Colorado [Mr. HEFLEY], But if we are going to tell Armenia, guarantees virtually to the Russian but I can give him some other exam- if we are going to tell Georgia, if we border. ples of mistakes. I recall just a couple are going to tell the Ukraine, if we are I ask Members, how many people of years ago when there was an op-ed going to tell anybody that we are not really believe that the American peo- piece in the Washington Post attacking going to support the democratization ple would support the idea that the me because I withheld funds for the En- and the ability of this administration United States ought to make a secu- terprise Funds in that region because to assist them to establish these de- rity commitment to defend all of east- they were insisting on paying salaries mocracies, well, then, maybe we ought ern Europe, possibly even the Ukraine of $400,000 a year. And our committee to cut it all out. Maybe that would be and some of the other countries in that held up that whole operation for 4 the way to go. If you want to build a region, much as we want to see those months until they blew that arrange- wall around America and say we are countries remain free? ment away. not going to participate in this type of In a public opinion poll, how many You have been told by the sub- international activity, build a wall up. Americans do you think would vote for committee chairman that not a dime is Let’s do it that way. us to extend that security commitment going to be able to be spent in Russia But to come in and to say that we are with all of the dollars that it would until they bring the way they intend to going to cut $296.8 million and take it cost to maintain that commitment and spend it back to the committee so we away from those countries who deserve with all of the cost it might someday can make a judgment about it. That is our help and who we want to support, reach in human terms? I suspect the going a far piece, to make certain that and we don’t want to create another answer is not very many. to the best of our ability in the legisla- cold war, we don’t want to give them If you believe that, as I do, then it tive as opposed to administrative body, encouragement to begin redeveloping a seems to me that what you need to do that we can help prevent the executive military, we want to assist them where is to find a way to make sure, even branch from making further mistakes. they will not become reunited again, though we only affect events on the which is what your amendment is margin in that region, to try to find a I do not like the fact that a single going to force, I think, ultimately way to make sure that we never have dime was wasted. But the fact is I them to do, is to say, ‘‘Look, we to provide that kind of money and we think that it was perfectly understand- thought the United States would help never have to provide the use of Amer- able for the previous administrations us, we thought the other G–7 nations ican troops to defend those countries. to say, ‘‘look, we’ve got to try every- would help us, but now they’re turning What is the best way to do that? thing. Undoubtedly we will make some their backs on us.’’ Well, when the Iron Curtain collapsed, mistakes, but we’re going to experi- Mr. Chairman, I strongly oppose the the Bush administration and the Con- ment. We hope you bear with us.’’ I gentleman’s substitute amendment. I gress on a bipartisan basis decided the think it was reasonable for them to ask urge Members to vote against the best way to do that was to try to pro- us that. I think it is reasonable for the Hefley amendment. I urge Members to mote market reforms in the Soviet Clinton administration to ask that we vote for the Wilson substitute, and if Union. give them reasonable flexibility in the Wilson substitute passes, I would Secretary Baker came down to the dealing with all of the problems in that encourage Members to then vote for committee and he said, ‘‘Look, fellows region. I would respectfully suggest the Miller amendment as substituted and gals,’’ he said, ‘‘I know we’re going that we would be cutting off our nose by the gentleman from Texas [Mr. WIL- to make some mistakes, but I beg you to spite our face and damaging our own SON]. not to tie our hands. We don’t know economic and political and national in- Mr. HEFLEY. Mr. Chairman, will the what opportunities are going to be pre- terest if we make this kind of reduc- gentleman yield? sented to us, we don’t know what tion. I urge Members not to do this. H 6358 CONGRESSIONAL RECORD — HOUSE June 27, 1995 b 1845 A few years ago, 3 or 4 years ago, $30 million cut, as I would propose Mr. DUNCAN. Mr. Chairman, I move Henry Kissinger wrote an article for under title V, would be more appro- to strike the requisite number of the Washington Post that said unfortu- priate. words. nately most of our aid to Russia is Last, I think, Mr. Chairman, it is Mr. Speaker, I will not take the full going down a black hole. We need to very appropriate for us to send a mes- 5 minutes, but I rise in strong support stop pouring money down that black sage to Mr. Yeltsin and the Russian of the amendment offered by the gen- hole. people that they must stop imme- tleman from Colorado [Mr. HEFLEY]. I Our first obligation is to the U.S. diately this war in Chechnya. This is in think it is a very fair and reasonable taxpayers. We are still almost $5 tril- our direct interest to do. It is in our di- amendment. I rise in support of this lion in debt. We are still losing almost rect interest because the Russians have amendment not as any criticism of the a billion dollars a day. We are spending just recently acquired a $6.2 billion gentleman from Alabama, because I money that we do not have; $300 mil- loan from the IMF. We are the largest think that he has done everything lion in aid to the States of the former guarantor of those loans through the within his power to make this bill as Soviet union is plenty. IMF. We have a great deal at stake in fair to everyone as possible and to cut I urge support for this amendment of- the Russian transformation to a free it as low as possible, but the last fered by the gentleman from Colorado enterprise system and a democracy, speaker mentioned that he thinks that [Mr. HEFLEY]. and the Russian people, the Russian a public opinion poll would show that Mr. ROEMER. Mr. Chairman, I move Government are spending about $2 bil- very few people would support an ex- to strike the last word. lion in pursuing this war in Chechnya. tension of NATO. I would say to you Mr. Chairman, I rise with a great Now, this is morally and ethically a that I think a very small percentage, a deal of sympathy for the intent of the tragic war that is taking away from very few of the American citizens, an amendment offered by the gentleman the efforts to transform their economy overwhelming majority of the Amer- from Colorado [Mr. HEFLEY]. and their government. So I think it is ican citizens would not support us even I think that it is appropriate that appropriate for us to send a message to spending $300 million in aid to the Congress act on the floor of the House them. I would hope that the gentleman States of the former Soviet Union, and of Representatives with respect to from Colorado would join on title V that is, of course, the amount that sending a message to Russia. But I where we can directly limit the aid to would be left to do in the amendment think that the gentleman’s amendment Russia rather than get at some of the offered by the gentleman from Colo- is probably for method, for money, and newly independent states’ moneys. rado. for message the wrong place to send I think it is very appropriate for the We should have no reason to feel this message to the Russian people. Let United States Congress to say to the guilty about that figure of $300 million, me explain what I mean. Russians and to Mr. Yeltsin: ‘‘This war because we have sent billions over First of all, I would oppose the gen- has got to stop. It is hurting you in the there just the last few years. In fact, 4 tleman’s amendment because of the West. It is hurting you in the world. It years ago Leslie Gelb, the foreign af- method. I will offer an amendment is hurting your people. It is hurting fairs editor of the New York Times, es- under title V which will place a limita- people. It is hurting peace. It is an im- timated that the combined Western aid tion on moneys to Russia. It will not moral war, and it must stop.’’ to the former States of the Soviet get into the moneys that would go to That is a good message for the people Union had totaled $60 billion, most of the newly independent states. We do of the United States to send to the peo- it coming from the United States. not want to punish under this amend- ple of Russia and to Mr. Yeltsin. Two years ago this Congress voted to ment, even though we are saying this Mr. WELDON of Pennsylvania. Mr. send $12 billion to the States of the is intended for Russia, it is the account Chairman, I move to strike the req- former Soviet Union through the Inter- for the newly independent states as uisite number of words. national Monetary Fund and the World well. So it is not the appropriate meth- (Mr. WELDON of Pennsylvania asked Bank. Then in addition to that the gen- od to achieve the message that we and was given permission to revise and tleman from Alabama [Mr. CALLAHAN] want to send to Russia. extend his remarks.) mentioned a few moments ago that 2 Second, the money. Certainly, as we Mr. WELDON of Pennsylvania. Mr. years ago we sent $2.1 billion in direct send the hundreds of millions of dollars Chairman, I will not take the entire 5 aid to the States of the former Soviet to the Russian people, some of the pro- minutes, but I do rise in opposition to Union. I think it was $830 million last grams, very effective, very efficient, the amendment offered by the gen- year. If we reduced it to $300 million are working to achieve what we hope tleman from Colorado [Mr. HEFLEY], this year we would still have done that the Russian people achieve, and my good friend, and in support of the many times more than any other coun- that is a transition to a free enterprise compromise offered by the gentleman try in this entire world. system and democracy. from Texas [Mr. WILSON] and modified As the gentleman from Colorado [Mr. Some of the money that we are send- by the gentleman from Florida [Mr. HEFLEY] has mentioned, much of this ing is under the Nunn-Lugar money, MILLER] and the gentlewoman from money, most of this money, is going to which is trying to achieve peace and Florida [Ms. ROS-LEHTINEN]. overpriced, overpaid consultants. He stability, and I support that money. Mr. Chairman, 2 weeks ago I was on got this figure of $800 a day for a typi- Some of the money is sent from our the floor of the House perhaps leading cal consultant from a story which ran NASA account to buy the Russian par- the fight on increasing funds for mis- in the Wall Street Journal last year, ticipation in the space station. I object sile defense and for putting some limi- and that story ran under a headline, to that money. tations on Nunn-Lugar money so that quote, ‘‘U.S. Aid is Quite a Windfall for But certainly we should have a voice we could get some cooperation from U.S. Consultants,’’ and some consult- when we send hundreds of millions of the Russians on their chemical and bio- ants are receiving as much as 90 per- dollars over there. I think that is what logical weapons. cent of certain aid contracts. the gentleman from Florida [Mr. MIL- But, Mr. Chairman, this amendment And listen to this. The article said LER] and the gentleman from Colorado I think sends a totally wrong signal. It that there is, ‘‘dancing in the streets’’ [Mr. HEFLEY] are saying, but we do not is important for us, I think, to let the by consultants but hardly any of the want to devastate our relationship Russian military know that we are money is getting through to the aver- with the Russian people at such a deli- going to deal with them from a posi- age Russian. The story reported criti- cate and precarious time. I think to tion of strength and that we are going cism because of waste and meager re- send the message that we are going to to take what steps we have to take to sults. That same story quoted one ex- cut $296 million out of aid to the Rus- protect our people. pert as saying that, ‘‘The aid benefits sian people is simply too much at this But it is equally important for us to Russians minimally, if at all,’’ and delicate, precarious time. send a signal to the Russian people, that he expects ‘‘a scandal down the I think more in terms of a limitation and the citizens of Armenia and Azer- road that is going to upset the tax- only to Russia, directed at Russia, and baijan and Turkmenistan and payers.’’ specifically limiting it by $30 million; a Uzbekistan and Tadzhikistan, and all June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6359 those other former Soviet republics, where instead of building warships, b 1900 that we are going to work with them to those 8,500 workers can help dismantle help them move away from a military- old Russian warships and deal with It is not responsible, from this Mem- industrial economy, move toward a PCB’s and lead-based paints and the ber’s point of view, to make the kind of free market system. other problems inherent in naval war- cuts that the gentleman from Colorado That is what this money does, Mr. ships. [Mr. HEFLEY] envisions cutting. He has made some good arguments, and they Chairman. I think that this amend- In addition, we have seen from the ment sends the wrong signal. Let us are arguments that we need to address, funding that would be cut in this but this is not the way to address it. look at some of the specific programs amendment the development of an Biz- that have benefited from this funding. net program. And I urge my colleagues The way to address it is look at what I will just give some examples of ones to do down to the Department of Com- the committee has done and seriously that I have been working with. merce and see the tremendous strides sending a message to Russia by cutting Our good friend, the gentleman from made in working to encourage Amer- from the request and cutting from last Texas [Mr. LAUGHLIN] and I for the last ican businesses to do joint ventures in year. 21⁄2 years have cochaired the Former Russia and the other republics. But there are real, legitimate con- Soviet Union-American Energy Caucus. That is creating American jobs and cerns that the committee has. We are We have worked with the 16 largest en- American economic opportunity, but it sending a message with the Wilson sub- ergy corporations in the world, most of is having a direct positive impact on stitute, a very real message that if them American corporations, to de- the Russian economy and the economy Russia does not clean up their act, velop energy initiatives inside the of the other republics. there will be consequences from this former Soviet republics. The assistance body. But when you come to the rubber Mr. Chairman, I am as concerned from programs like those funded today hitting the road, you have to ask your- about what is happening in Chechnya made possible the single largest energy self, are we cutting for cutting sake or as any of my colleagues in this body. deal in the world. are we cutting to make responsible de- But, Mr. Chairman, I think this amend- The Sakhalin project deal was just cisions? concluded this past year. It will see $10 ment sends the wrong signal. I think I think the Hefley amendment cuts billion of western investment that will we have to be aggressive with the Rus- too deep. I would urge our Members to allow Mobil and Marathon Corp. to sian Government, as we did on the de- vote against Hefley amendment and work with the Russians in developing fense bill. But I think we also have to support the Wilson substitute. what we think is one of the world’s show that we want to be supportive; we largest energy resources. want to nurture the free enterprise de- Mr. WILSON. Mr. Chairman, I move That will directly benefit this coun- velopments that are occurring there; to strike the requisite number of try, private sector money, western cap- we want to encourage the kind of posi- words. ital, and help stabilize the Russian tive economic opportunities that are I will not take the full 5 minutes. I economy. developing throughout the former So- would like to echo what the gentleman The same thing is happening right viet states today. from Wisconsin [Mr. OBEY] said about now in the Caspian Sea where we are So I would urge my colleagues, de- what I consider to be the very dan- working with a group that wants to de- spite my friendship with the gentleman gerous idea of expanding NATO into velop a project and a pipeline that may from Colorado [Mr. HEFLEY], to oppose countries the American people prob- help us bring together the Armenians this amendment and to support the ef- ably have not too much interest in de- and the Azeris in a way that will allow forts of the gentleman from Texas [Mr. fending and that can make no con- then to see economic benefits from a WILSON] and also the gentleman from tribution on their own. I do not think project developing energy resources in Florida [Mr. MILLER] in this amending the United States really and truly the Caspian Sea. process. wants to extend our nuclear umbrella Why are these projects so important? Mr. DELAY. Mr. Chairman, I move to to the borders of Russia. The alternative for the Russian people, strike the requisite number of words. I would like to remind the members and those people of the other former Mr. Chairman, I rise in opposition to that we are talking about, in the great Soviet republics, is to sell off their nu- the Hefley amendment and in support scheme of things, we are talking about clear technology; that is unacceptable of the Wilson substitute, I know that it a very minuscule amount of money. to us. To sell off their conventional is fun to come down to the floor and do The most successful foreign policy ini- arms to raise capital; that is unaccept- a lot of cutting. I used to do it a lot on tiative that the United States has ever able to us. We have seen them do it my own. And I hope Members heard the enjoyed was the Marshall Plan. The with the submarine sales to Iran with gentleman from Pennsylvania’s excel- Marshall Plan saved Europe from com- the efforts to sell off their technology. lent presentation on being responsible munism. We even extended the Mar- Therefore, we must work in a posi- when you do the cutting. shall Plan to Germany, to our great tive way to develop joint economic op- enemy in World War II. But, again, it portunities and to help the Russians Mr. Chairman, the committee has been responsible. The committee has saved democracy. It kept Europe from realize their full economic potential. becoming communist. It kept Europe Just last year a delegation of the Mem- made deep cuts in aid to the former So- viet Union. But the Hefley amendment from coming behind the Iron Curtain. bers of this Congress, bipartisan, went It was done in a great bipartisan man- over to Murmansk, and we came back goes way too far and seriously under- mines our ability to work with Russia ner. It was not popular with the Amer- and worked with the Trade Develop- ican people. It was an enormous ment Administration. We have heard and the independent states, as the gen- tleman from Pennsylvania [Mr. amount of money, particularly com- criticism about consultants. pared to what we are doing today. The Trade Development Administra- WELDON] has so eloquently outlined. tion awarded a $300,000 grant to the Two-thirds of the money that is left I suggest that this modest invest- MacKinnon Searle Group of Virginia to in this bill, after having cut it to $193 ment in the newly independent states begin the study of the conversion of million less than the request, and $248 is in the same spirit as the Marshall the largest shipyard in St. Petersburg. million less than last year, two-thirds Plan was. The Baltic shipyards in St. Petersburg of this money does not go to Russia. Finally, I would like to underline one is where the Russians built the Kirov- The Hefley amendment cuts aid to more time that two-thirds of this class warships, where they have poten- Ukraine, Armenia, and other victims of money, two-thirds of this cut, are tial to build nuclear warships, 8,500 the former Communist state. We need going to cut the hearts out of the pro- workers. to continue our support for an inde- grams that we have in the Ukraine, Money that will be cut in this pendent Ukraine. We need this money that we have in Armenia, that we have amendment was used to begin the proc- to keep Armenia alive. It will seriously in Georgia and that we have in other ess of converting that shipyard to an undercut the remaining free countries which I not only cannot spell environmental remediation center marketeers and reformers in Russia. but I cannot pronounce. H 6360 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Finally, finally, finally, I would like Bentsen Gibbons Murtha Wolf Wyden Young (AK) Bereuter Gilchrest Myers Woolsey Wynn Zeliff to remind the House that we are talk- Berman Gillmor Nadler NOT VOTING—10 ing here about a couple hundred mil- Bevill Gilman Neal lion dollars. But I would also remind Bilbray Gonzalez Nethercutt Camp Mfume Yates the House that since the Berlin Wall Bishop Goodling Nussle Collins (MI) Moakley Zimmer Furse Reynolds came down, since the great changes oc- Bliley Gordon Oberstar Blute Goss Obey Gunderson Torricelli curred in the Soviet Union and since Boehlert Graham Olver b the disintegration of the Soviet Union, Boehner Greenwood Ortiz 1924 that we have saved probably today, Bonilla Gutierrez Orton Mr. RUSH and Mr. VOLKMER Bonior Hall (OH) this year, our defense budget is prob- Owens changed their vote from ‘‘aye’’ to ‘‘no.’’ Bono Hamilton Oxley ably $200 billion less than it would be if Borski Harman Packard Messrs. KIM, LEWIS of Kentucky, we were still facing a highly national- Boucher Hastert Pallone METCALF, WHITFIELD, and istic Soviet Union. So I think, by any Browder Hastings (FL) Parker GOODLATTE, Mrs. CHENOWETH, and Brown (CA) Hefner Paxon Messrs. BURTON of Indiana, DOO- measure, by any measure, that the Brown (FL) Heineman Payne (NJ) LITTLE, EVERETT, BARTON of Hefley amendment should be defeated. Brown (OH) Hilliard Payne (VA) The CHAIRMAN. The question is on Brownback Hinchey Pelosi Texas, and INGLIS of South Carolina the amendment offered by the gen- Bryant (TX) Hobson Peterson (FL) changed their vote from ‘‘no’’ to ‘‘aye.’’ Bunn Hoke Pickett So the amendment offered as a sub- tleman from Colorado [Mr. HEFLEY] as Burr Holden Pomeroy stitute for the amendment offered as a a substitute for the amendment offered Buyer Horn Porter by the gentleman from Texas [Mr. WIL- Callahan Hostettler Portman substitute for the amendment was re- Calvert Houghton SON] as a substitute for the amendment Poshard jected. Cardin Hoyer Pryce The result of the vote was announced offered by the gentleman from Florida Castle Hunter Quinn as above recorded. [Mr. MILLER]. Chabot Hutchinson Radanovich The CHAIRMAN. The question is on The question was taken; and the Chambliss Hyde Rahall Chrysler Istook the amendment offered by the gen- Chairman announced that the noes ap- Rangel Clay Jackson-Lee Reed tleman from Texas [Mr. WILSON] as a peared to have it. Clayton Jefferson Regula Clement Johnson (CT) substitute for the amendment offered RECORDED VOTE Richardson by the gentleman from Florida [Mr. Clinger Johnson (SD) Riggs Mr. HEFLEY. Mr. Chairman, I de- Clyburn Johnson, E. B. Rivers MILLER]. mand a recorded vote. Coleman Johnston Roberts The amendment offered as a sub- A recorded vote was ordered. Collins (IL) Kanjorski Roemer Conyers Kasich stitute for the amendment was agreed The CHAIRMAN. Pursuant to clause Ros-Lehtinen to. Costello Kelly Rose 2 of rule XXIII, the Chair will reduce to Coyne Kennedy (MA) Roth The CHAIRMAN. The question is on a minimum of 5 minutes the time for a Cramer Kennedy (RI) Roybal-Allard the amendment offered by the gen- Crane Kennelly Rush tleman from Florida [Mr. MILLER], as recorded vote, if ordered, on the Wilson Crapo Kildee substitute and then on the original Sabo amended. Cremeans King Sanders Miller amendment, if there is no inter- Cubin Kleczka Sawyer The amendment, as amended, was vening business or debate following the Davis Klink Saxton agreed to. de la Garza Knollenberg Schiff AMENDMENT OFFERED BY MS. JACKSON-LEE 15-minute vote. Deal LaFalce Schroeder Ms. JACKSON-LEE. Mr. Chairman, I The vote was taken by electronic de- DeLauro LaHood Schumer vice, and there were—ayes 104, noes 320, DeLay Lantos Scott offer an amendment. not voting 10, as follows: Dellums Latham Serrano The Clerk read as follows: Deutsch LaTourette Shaw Amendment offered by Ms. JACKSON-LEE: [Roll No. 425] Diaz-Balart Laughlin Shays Dickey Lazio Page 19, line 16, strike ‘‘$10,000,000’’ and in- AYES—104 Sisisky sert in lieu thereof ‘‘$11,500,000’’. Dicks Leach Skaggs Allard Hansen Quillen Dingell Levin Skeen Mr. CALLAHAN. Mr. Chairman, I re- Baker (LA) Hastings (WA) Ramstad Dixon Lewis (CA) Slaughter Barcia Hayes Rogers Doggett Lewis (GA) serve a point of order against the Smith (NJ) Barton Hayworth Rohrabacher Dooley Lightfoot amendment. Smith (TX) Bilirakis Hefley Roukema Dornan Linder Spence Ms. JACKSON-LEE. Mr. Chairman, Brewster Herger Royce Doyle Lipinski Spratt first let me applaud the work that has Bryant (TN) Hilleary Salmon Dreier Livingston Stark Bunning Hoekstra Dunn LoBiondo been done by the mutual chairperson/ Sanford Stokes Burton Inglis Durbin Lofgren ranking member. Scarborough Studds Canady Jacobs Edwards Lowey Schaefer Stupak Chapman Johnson, Sam Ehlers Lucas b 1930 Seastrand Taylor (NC) Chenoweth Jones Ehrlich Luther Sensenbrenner Tejeda A parable has been heard by many of Christensen Kaptur Shadegg Emerson Maloney Coble Kim Thomas us that says if you give a man a fish, he Shuster Engel Manton Coburn Kingston Thompson Skelton English Markey will ask for another fish tomorrow. But Collins (GA) Klug Thornberry Smith (MI) Eshoo Martinez if you teach him how to fish, then he Combest Kolbe Thornton Smith (WA) Evans Martini Condit Largent Thurman will be independent and be able to Solomon Ewing Mascara Cooley Lewis (KY) Tiahrt make a way for himself in years to Souder Farr Matsui Cox Lincoln Fattah McCarthy Torkildsen Stearns come. Cunningham Longley Fawell McCollum Torres Stenholm I rise today to offer an amendment to Danner Manzullo Fazio McCrery Towns Stockman DeFazio McInnis Fields (TX) McDade Tucker H.R. 1868, which would increase the Stump Doolittle McKeon Filner McDermott Upton funding for the African Development Talent Duncan McKinney Flake McHale Velazquez Tanner Foundation in the fiscal year 1996 from Ensign Metcalf Flanagan McHugh Vento $10 to $11.5 million. This is a modest in- Everett Mica Tate Foglietta McIntosh Visclosky Fields (LA) Myrick Tauzin Foley McNulty Volkmer crease, Mr. Chairman, but it will help Funderburk Neumann Taylor (MS) Forbes Meehan Vucanovich the African Development Foundation Geren Ney Traficant Ford Meek Waldholtz to continue its important work in 20 Goodlatte Norwood Wamp Fowler Menendez Walker Green Pastor Watts (OK) Fox Meyers Walsh African countries. Gutknecht Peterson (MN) Weller Frank (MA) Miller (CA) Ward Established in 1980, the African De- Hall (TX) Petri Whitfield Franks (CT) Miller (FL) Waters velopment Foundation is a progressive Hancock Pombo Young (FL) Franks (NJ) Mineta Watt (NC) organization that delivers funds di- Frelinghuysen Minge Waxman NOES—320 Frisa Mink Weldon (FL) rectly to self-help organizations in eco- Abercrombie Baesler Barrett (WI) Frost Molinari Weldon (PA) nomically undeveloped countries in Af- Ackerman Baker (CA) Bartlett Gallegly Mollohan White rica. Since no funds are channeled Andrews Baldacci Bass Ganske Montgomery Wicker through any foreign government, the Archer Ballenger Bateman Gejdenson Moorhead Williams Armey Barr Becerra Gekas Moran Wilson ADF avoids any bureaucratic patterns Bachus Barrett (NE) Beilenson Gephardt Morella Wise in dispensing funds. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6361 This organization has been instru- That up to $100,000 of the funds appropriated tion procedures of section 515 of this Act: mental in expanding ties and develop- under this heading may be made available Provided further, That funds made available ing good will among the citizens of the for grant financed military education and under this heading shall be obligated upon United States and the citizens of many training for any high income country on the apportionment in accordance with paragraph condition that that country agrees to fund (5)(C) of title 31, United States Code, section African countries. I understand that form its own resources the transportation 1501(a): Provided further, That none of the every Federal program and every agen- cost and living allowances of its students: funds appropriated under this heading shall cy is now under extensive review under Provided further, That the civilian personnel be available for Zaire, Sudan, Peru, Liberia, this concept of responding to the Fed- for whom military education and training and Guatemala: Provided further, That none eral budget deficit. However, I would may be provided under this heading may also of the funds appropriated or otherwise made simply say in keeping in mind about include members of national legislatures available for use under this heading may be teaching a man or woman to fish, and who are responsible for the oversight and made available for Colombia or Bolivia until helping to feed hungry children and im- management of the military, and may also the Secretary of State certifies that such include individuals who are not members of funds will be used by such country primarily proving the development opportunities a government: Provided further, That none of for counternarcotics activities: Provided fur- in developing nations, that this amend- the funds appropriated under this heading ther, That funds made available under this ment needs and deserves consideration. shall be available for Zaire: Provided further, heading may be used, notwithstanding any I would ask my colleagues to consider That funds appropriated under this heading other provision of law, for demining activi- it, because it adds to the funding to for grant financed military education and ties, and may include activities implemented help impact the real lives of people in training for Indonesia and Guatemala may through nongovernmental and international our developing nations. only be available for expanded military edu- organizations: Provided further, That not I would simply say, Mr. Chairman, cation and training. more than $100,000,000 of the funds made available under this heading shall be avail- that I hope we are able to come to a FOREIGN MILITARY FINANCING PROGRAM For expenses necessary for grants to en- able for use in financing the procurement of reasoned response and compromise for defense articles, defense services, or design the African Development Foundation able the President to carry out the provi- sions of section 23 of the Arms Export Con- and construction services that are not sold which will be strengthened by these ad- trol Act, $3,211,279,000: Provided, That funds by the United States Government under the ditional dollars of $1.5 million. It will appropriated by this paragraph that are arms Export Control Act to countries other help strengthen the economies, en- made available for Israel and Egypt shall be than Israel and Egypt: Provided further, That hance the number of people that can made available only as grants: Provided fur- only those countries for which assistance benefit from the grants awarded to ag- ther, That the funds appropriated by this was justified for the ‘‘Foreign Military Sales paragraph that are made available for Israel Financing Program’’ in the fiscal year 1989 ricultural cooperatives, youth groups congressional presentation for security as- and self-help organizations. shall be disbursed within thirty days of en- actment of this Act or by October 31, 1995, sistance programs may utilize funds made These groups have been effective available under this heading for procurement stewards of the grants that range from whichever is later: Provided further, That to the extent that the Government of Israel re- of defense articles, defense services or design 20,000 to 250,000. That is the most im- quests that funds be used for such purposes, and construction services that are not sold portant part of ADF. It provides small grants made available for Israel by this para- by the United States Government under the amounts of money that are leveraged graph shall, as agreed by Israel and the Unit- Arms Export Control Act: Provided further, into large amounts of activity and suc- ed States, be available for advanced weapons That, subject to the regular notification pro- cess. My amendment is important to systems, of which not to exceed $475,000,000 cedures of the Committees on Appropria- tions, funds made available under this head- the African Development Foundation shall be available for the procurement in Is- rael of defense articles and defense services, ing for the cost of direct loans may also be and to the people of Africa and to mil- used to supplement the funds available under lions of Americans who support ade- including research and development: Pro- vided further, That funds made available this heading for grants, and funds made quate development assistance. under this paragraph shall be nonrepayable available under this heading for grants may Again, it reinforces the point, Mr. notwithstanding any requirement in section also be used to supplement the funds avail- Chairman, that if you give a man a 23 of the Arms Export Control Act: Provided able under this heading for the cost of direct fish, or a woman, they will ask for an- further, That none of the funds made avail- loans: Provided further, That funds appro- other fish tomorrow. But teach them able under this heading shall be available for priated under this heading shall be expended at the minimum rate necessary to make to fish, and they will maintain that op- any non-NATO country participating in the Partnership for Peace Program except timely payment for defense articles and portunity for development for years to services: Provided further, That the Depart- come. through the regular notification procedures of the Committees on Appropriations. ment of Defense shall conduct during the I ask my colleagues to support this For the cost, as defined in section 502 of current fiscal year nonreimbursable audits of modest amendment to make a state- the Congressional Budget Act of 1974, of di- private firms whose contracts are made di- ment for enhancing opportunity for our rect loans authorized by section 23 of the rectly with foreign governments and are fi- African countries and their self-help Arms Export Control Act as follows: cost of nanced with funds made available under this organizations. direct loans, $64,400,000: Provided, That these heading (as well as subcontractors there- The CHAIRMAN. Does the gentleman funds are available to subsidize gross obliga- under) as requested by the Defense Security tions for the principal amount of direct loans Assistance Agency: Provided further, That from Alabama seek recognition on his not more than $24,000,000 of the funds appro- point of order? of not to exceed $544,000,000: Provided further, That the rate of interest charged on such priated under this heading may be obligated Mr. CALLAHAN. Mr. Chairman, I loans shall be not less than the current aver- for necessary expenses, including the pur- would like to withdraw my point of age market yield on outstanding marketable chase of passenger motor vehicles for re- order and accept the gentlewoman’s obligations of the United States of com- placement only for use outside of the United amendment. parable maturities: Provided further, That States, for the general costs of administering Mr. WILSON. Mr. Chairman, there is funds appropriated under this heading shall military assistance and sales: Provided fur- no objection to the amendment on this be made available for Greece and Turkey ther, That not more than $355,000,000 of funds realized pursuant to section 21(e)(1)(A) of the side. only on a loan basis, and the principal amount of direct loans for each country shall Arms Export Control Act may be obligated The CHAIRMAN. The question is on for expenses incurred by the Department of the amendment offered by the gentle- not exceed $224,000,000 for Greece and shall not exceed $320,000,000 for Turkey. Defense during fiscal year 1996 pursuant to woman from Texas [Ms. JACKSON-LEE]. None of the funds made available under section 43(b) of the Arms Export Control Act, The amendment was agreed to. this heading shall be available to finance the except that this limitation may be exceeded The CHAIRMAN. Are there further procurement of defense articles, defense only through the regular notification proce- amendments to title II? services, or design and construction services dures of the Committees on Appropriations. The Clerk will designate title III. that are not sold by the United States Gov- PEACEKEEPING OPERATIONS The text of title III is as follows: ernment under the Arms Export Control Act For necessary expenses to carry out the TITLE III—MILITARY ASSISTANCE unless the foreign country proposing to provisions of section 551 of the Foreign As- make such procurements has first signed an sistance Act of 1961, $68,300,000. FUNDS APPROPRIATED TO THE PRESIDENT agreement with the United States Govern- INTERNATIONAL MILITARY EDUCATION AND The CHAIRMAN. Are there amend- ment specifying the conditions under which ments to title III? TRAINING such procurements may be financed with For necessary expenses to carry out the such funds: Provided, That all country and AMENDMENT OFFERED BY MRS. LOWEY provisions of section 541 of the Foreign As- funding level increases in allocations shall Mrs. LOWEY. Mr. Chairman, I offer sistance Act of 1961, $39,000,000: Provided, be submitted through the regular notifica- an amendment. H 6362 CONGRESSIONAL RECORD — HOUSE June 27, 1995 The CHAIRMAN. The Clerk will des- We, in Congress, made the right deci- ment would have been during the au- ignate the amendment. sion in 1992 when we cut off all IMET thorization bill. During the authoriza- The text of the amendment is as fol- funding to Indonesia. But we must not tion bill, we labored under a rule that lows: go backward now. I urge my colleagues ate up a considerable amount of time Amendment offered by Mrs. LOWEY: Page to support this amendment and send a on some very important amendments, 23, line 19, insert ‘‘or Indonesia’’ after message to Indonesia that we will not that ate up a long, long time of debate. ‘‘Zaire’’. tolerate the oppression of the Timorese There were dozens and dozens of Page 23, line 21, strike ‘‘Indonesia and’’. people. amendments like this one that could Mr. CALLAHAN. Mr. Chairman, I re- The CHAIRMAN. Does the gentleman have been offered that were not heard serve a point of order on the amend- from Alabama [Mr. CALLAHAN] seek during that debate. ment. recognition on his point of order? Now, it seems to me that this kind of The CHAIRMAN. The gentleman Mr. CALLAHAN. Mr. Chairman, I consideration of process puts the Mem- from Alabama reserves a point of continue to reserve my point of order bers of this House in a Catch-22 situa- order. Mr. WOLF. Mr. Chairman, I rise in tion. You cannot legislate on an appro- Mrs. LOWEY. Mr. Chairman, I rise support of the amendment. priations bill by attaching conditions today to correct a critical flaw in the Mr. Chairman, I am really sorry this to spending like this. That is our rule. bill before us. In 1992, we voted to end amendment has to be offered. I would And then you are supposed to pursue it all international military education have hoped that the Indonesian Gov- in an authorization bill. But when the and training assistance for Indonesia ernment would have learned, and this authorization bills come up, we have because of that country’s abysmal is an opportunity I think to send a unduly restricted rules that cut off de- human rights record and their contin- message to them. The amendment of- bate in an arbitrary time and never ued oppression of the people of East fered by the gentlewoman from New permit this kind of thing to come up. Timor. York [Mrs. LOWEY] is a good amend- The real shame, Mr. Chairman, the Regrettably, this bill reinstates ment. The Indonesian military should real shame that is being raised by Mrs. IMET funding for Indonesia, which has not be rewarded for their conduct with LOWEY’s amendment, is that such a shown no significant improvement in the American IMET dollars. Congress meritorious and critical debate will its human rights record since the IMET and the American people value human never really happen and never really ban was imposed. In fact, the State De- rights and dignity, and we should not get a vote because of the way the rules partment’s own human rights report be timid about conveying that message of the House are being manipulated. I notes that there have been only cos- to countries that do not share our basic think that is a shame. metic changes in East Timor. concerns. We should be prepared to use Mr. CALLAHAN. Mr. Chairman, I Violent crackdowns on peaceful dem- bills like this to send that message. continue to reserve my point of order. onstrations in East Timor continue. Mr. Chairman, the State Depart- Mr. REED. Mr. Chairman, I move to First, innocent protestors are mas- ment’s country reports on Human strike the requisite number of words. sacred and then the military rounds up Rights Practices for 1994 reports, ‘‘The Mr. Chairman, I rise in strong sup- and jails the witnesses so that the Indonesian Government continued to port of this amendment and commend world will never know what happens. Is commit serious human rights abuses the gentlewoman from New York [Mrs. this the type of oppression we want to and in some areas, notably freedom of LOWEY], and the gentleman from Vir- be rewarding with U.S. assistance? I expression, it became markedly more ginia [Mr. WOLF], for their leadership don’t think so. oppressive, departing from a long-term in proposing this amendment. Indeed, I The State Department report goes trend toward greater openness. The attempted to offer a similar amend- on: ‘‘Extrajudicial arrests and deten- most serious abuses included the con- ment to H.R. 1561, the Foreign Aid Au- tion, torture of those in custody, and tinuing inability of the people to thorization bill, but as my colleague excessively violent techniques for deal- change their government and harsh re- from New Jersey explained, because of ing with suspected troublemakers con- pression in East Timor.’’ this construction of the rule, I was ef- tinued’’ throughout Indonesia. ‘‘The I would tell the Members of the body, fectively prevented from doing this. Armed Forces continued to be respon- if they could have seen the film and In 1992, my former colleague from sible for the most serious human rights talked to the men and women that Rhode Island, Mr. Machtley, offered abuses.’’ were there, what the Indonesian army successfully an amendment to cut In November 1991, in the city of Dili, did to these people was brutal, absolute training for funding for the training of the Indonesian military slaughtered 200 persecution of the Catholic Church. Indonesia military in response to fla- people in full view of news cameras. The Congress should be concerned with grant abuses of human rights in East Sixty-five people are still unaccounted these issues, and I strongly urge the Timor. When Congress cut this money, for, and yet the Indonesian Govern- Members of the body to support this it send two strong messages: First, to ment does not apologize for these amendment. Hopefully this will send a the Government of Indonesia that the killings. On the contrary, the regional message to Indonesia, where by next U.S. will not tolerate any more human commander of East Timor, Gen. Her- year things will be good and this will rights abuses by the military in East man Mantiri, said: ‘‘We don’t regret not be a problem. Timor, and, second, to the East Timor- anything. What happened was quite Mr. CALLAHAN. Mr. Chairman, I ese, who were finally given hope that proper. They were opposing us.’’ continue to reserve my point of order. someone had listened to their call for Mr. Chairman, Indonesia’s policy in Mr. ANDREWS. Mr. Chairman, I help and provided them a voice in the East Timor is about the oppression of move to strike the last word. face of oppression. people who oppose Indonesia’s right to Mr. Chairman, I rise in support of the Today we are debating a bill which torture, kill, and repress the people of amendment offered by the gentle- effectively restores this money. That East Timor. It is about the 200,000 woman from New York [Mrs. LOWEY]. I might be appropriate if the conditions Timorese who were slaughtered by the think she makes a persuasive and com- in East Timor had improved, but in Indonesian military when they invaded pelling case. The ongoing violation of fact they have not. in 1975. Two-hundred thousand killed human rights in Indonesia is I would like to emphasize that this out of a total population of 700,000. It is unsustainable in a moral way, and cer- amendment is not about the efficacy of about genocide. tainly not supportable in a budgetary American military training and the The language in this bill is the first way. value of exposing foreign military per- step toward releasing pressure on the It is my understanding that shortly sonnel to our professional military in- Indonesian Government to clean up its the Chair will be asked to rule on a struction. No, this is about sending a act. Without passage of this amend- point of order with respect to legislat- strong signal concerning the abuse of ment, we will continue to support a ing on an appropriations bill. Let me human rights in East Timor. government that laughs in the face of just make this comment: Presumably In June and July of last year, Indo- the human rights principles that we the Chair will consider whether the nesian troops committed acts of sac- hold dear. proper time to offer the Lowey amend- rilege against the East Timorese June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6363 church and clergy. The courts are still human rights conditions in Indonesia. To get to the point about Indonesia, sentencing people to long prison terms To quote from the State Department’s because I know time is of the essence, for speaking to journalists or sending 1994 human rights report, it is a close call on the enhanced and information critical of the govern- The Indonesian government continued to expanded IMET. Many of us have had ment. On January 12 of this year, Indo- commit serious human rights abuses and in some very serious concerns about how nesian soldiers killed six men outside some areas, notably freedom of expression, it IMET funds have been used throughout Dili. These six civilians were shot in became markedly more repressive. The most the world. And in some countries, it retaliation for a guerrilla attack the serious abuse included the continuing inabil- underwrites the brutality of authori- day before, but sources present indi- ity of the people to change their government and harsh repression of the East Timorese tarian regimes with U.S. taxpayers’ cate that the six were never involved in dissidents. Restoring IMET at this time dollars. The expanded IMET is sup- the attack. would run counter to these findings and posed to be used to teach human rights At a joint hearing before the Inter- would undermine the moral force of these training, democratic institutions, the national Relations Subcommittee on findings. role of a military in a democratic soci- Asia and the Pacific and International We have in Indonesia a situation ety. And it would be hoped that that is Operations and Human Rights on where the benefits of IMET would be what these purposes would be in Indo- March 16, the Director of the Human lost. The corruption is too deep. The nesia. And I commend the gentle- Rights Watch stated, ‘‘In East Timor, violence is too extreme. And the re- woman from New York [Mrs. LOWEY] violations of fundamental rights have pression is too severe for us to hold any and the gentleman from Rhode Island been especially severe, and have wors- hope that it can be tempered through [Mr. KENNEDY] for bringing this resolu- ened dramatically since the APEC education and training. IMET is de- tion to the floor because it focuses just summit meeting in Djakarta last No- signed to support democracy and mili- on what expanded IMET is and why if vember.’’ tary professionalism, and we cannot we would continue to grant it, if we When we are cutting aid to Africa support what does not already exist. would grant it to Indonesia, why it and are cutting many, many worthy U.S. aid cannot fill this vacuum. should be used specifically for those programs, it seems incongruous we IMET is a powerful and effective tool. purposes. would be giving money in the face of It must be used in the right way at the The concern of some of us is that these human rights abuses. right time. This is not the time. Only funds sent to a country are fungible I would urge my colleagues to accept through continued pressure will we be and if the regime happens to be author- the amendment offered by the gentle- able to have the opportunity for an im- itarian and a violator of human rights, woman from New York [Mrs. LOWEY]. I then we are subsidizing that even with would urge them to send a strong sig- provement in East Timor. Now is not our good intentions. nal to the Government of Indonesia the time for the United States to send Others today have talked about what that we will not tolerate further conflicting messages on this issue. Mr. Chairman, I urge the adoption of the situation is in Indonesia in terms human rights abuses in East Timor. A headline in the New York Times in the Lowey amendment, and I ask my of human rights. I will say that I will November of last year stated, ‘‘Timor- colleagues to do the same. join with some others in quoting the Mr. CALLAHAN. Mr. Chairman, I re- ese worry world will now forget them.’’ 1995 State Department human rights Mr. Chairman, I urge my colleagues serve my point of order on the amend- country report which calls Indonesia not to forget them, to stick to the ment. ‘‘strongly authoritarian’’ and notes Ms. PELOSI. Mr. Chairman, I move precedent we have now established. We that ‘‘it became markedly more repres- to strike the requisite number of have taken a stand. We can make a dif- sive’’ during 1994 as the ‘‘government words. ference. Mr. Chairman, I urge my col- continues to commit serious human Mr. Chairman, I rise in support of the leagues to support the Lowey-Wolf rights abuses.’’ Lowey-Kennedy amendment and urge amendment. Last December, a United Nations our colleagues to support them. First, Special Rapporteur noted, b 1945 before speaking about that amend- the conditions that allowed the 1991 Santa Mr. CALLAHAN. Mr. Chairman, I re- ment, I want to commend our chair- Cruz killings to occur are still present. In serve my point of order on the amend- man, the gentleman from Alabama particular, the members of the security ment. [Mr. CALLAHAN], and the chairman of forces responsible for the abuses have not Mr. KENNEDY of Rhode Island. Mr. the full committee, the gentleman been held accountable and continue to enjoy Chairman, I move to strike the req- from Louisiana [Mr. LIVINGSTON], as virtual impunity. uisite number of words. well as our ranking members, the gen- The Rapporteur ‘‘clearly sensed ter- Mr. Chairman, I rise as a supporter tleman from Wisconsin [Mr. OBEY] and ror among many East Timorese he had and a true believer in the International the gentleman from Texas [Mr. WIL- the opportunity to meet.’’ The situa- Military Education and Training pro- SON], for their leadership in bringing tion has gotten worse during the first gram. But I am compelled, like my col- this very strong bipartisan bill to the half of 1995. leagues who have just spoken, by the floor. That is all to say, Mr. Chairman, overwhelming evidence to support this As a member of the subcommittee, I that I think that we should have the amendment offered by the gentle- want to personally thank Mr. CAL- opportunity to discuss this issue. If the woman from New York [Mrs. LOWEY], LAHAN for his exceptional leadership Chair has a point of order that we can- and the gentleman from Virginia [Mr. his first time out with this bill. He has not pass it here today, at least we WOLF]. consulted individually and personally should be sending a message to the au- This is a good program, but this is with members of the subcommittee, thoritarian regime in Indonesia that if the wrong time and the wrong place for listened to our concerns and did the they get this IMET, it is to be for en- IMET. For 3 years, Congress has denied best that he could do under the cir- hanced, that is, training their troops in IMET to Indonesia. A careful look at cumstances of our very limited alloca- human rights and training their mili- the record shows that this is no time to tion. That allocation was limited not tary in the proper role of the military shift this policy. When Congress, at the because our chairman of the full com- in a democratic society. urging of my predecessor, Ron mittee, Mr. LIVINGSTON, did not work With that, Mr. Chairman, I again Machtley, revoked Indonesian partici- hard to get us a better allocation but commend our chairman, Mr. CALLAHAN, pation in IMET, a clear and unmistak- just the realities of the budget resolu- and the ranking member, Mr. WILSON, able message was sent. We will no tion. for their great leadership on this legis- longer tolerate an intolerable situa- It is in that spirit of bipartisanship lation. tion. The human rights abuses in East and admiration for our chairman that I Mr. CALLAHAN. Mr. Chairman, I Timor must end. Simply put, the hope that we can pass this not perfect move to strike the requisite number of abuses have not ended. IMET should but best possible bill we could get on words. Before pressing my point of not be restored. the floor today. I hope when we do pass order, I want to rise in opposition to This amendment is most appropriate, it today or tomorrow that it will have the amendment and speak to it just considering recent assessments of the Lowey-Kennedy language in it. briefly. H 6364 CONGRESSIONAL RECORD — HOUSE June 27, 1995 I do rise in opposition to the amend- TITLE IV—MULTILATERAL ECONOMIC That of the amount appropriated under this ment of the gentlewoman from New ASSISTANCE heading not more than $54,600,000 may be ex- York, although I know she is offering FUNDS APPROPRIATED TO THE PRESIDENT pended for the purchase of such stock in fis- cal year 1996. it because it is based upon her own INTERNATIONAL FINANCIAL INSTITUTIONS LIMITATION ON CALLABLE CAPITAL strongly held convictions as well as the CONTRIBUTION TO THE INTERNATIONAL BANK SUBSCRIPTIONS other speakers who have spoken to- FOR RECONSTRUCTION AND DEVELOPMENT night. I appreciate the strong concerns For payment to the International Bank for The United States Governor of the Euro- of the gentleman from Virginia and the Reconstruction and Development by the Sec- pean Bank for Reconstruction and Develop- ment may subscribe without fiscal year limi- gentlewoman from California, the gen- retary of the Treasury, for the United States share of the paid-in share portion of the in- tation to the callable capital portion of the tleman from Rhode Island. But as the United States share of such capital stock in gentlewoman from New York knows, creases in capital stock for the General Cap- ital Increase, $23,009,000, to remain available an amount not to exceed $161,400,000. under our bill, Indonesia will not be el- until expended. NORTH AMERICAN DEVELOPMENT BANK igible for IMET training. For payment to the International Bank for For payment to the North American Devel- Under H.R. 1868, Indonesia will only Reconstruction and Development by the Sec- opment Bank by the Secretary of the Treas- be able to receive human rights train- retary of the Treasury, for the United States ury, for the United States share of the paid- ing under the expanded IMET training, contribution to the Global Environment Fa- in portion of the capital stock, $56,250,000, to as it is called. Expanded IMET is spe- cility (GEF), $50,000,000, to remain available remain available until expended. until September 30, 1997. cifically designed to help improve LIMITATION ON CALLABLE CAPITAL human rights practices of the military. LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS SUBSCRIPTIONS This is exactly the kind of program I The United States Governor of the North think the gentlewoman from New York The United States Governor of the Inter- American Development Bank may subscribe national Bank for Reconstruction and Devel- should be supporting. without fiscal year limitation to the callable opment may subscribe without fiscal year capital portion of the United States share of Furthermore, I would note that the limitation to the callable capital portion of the capital stock of the North American De- House Committee on International Re- the United States share of increases in cap- velopment Bank in an amount not to exceed lations has already recommended ex- ital stock in an amount not to exceed $318,750,000. $743,900,000. panding IMET for Indonesia, and in- INTERNATIONAL ORGANIZATIONS AND PROGRAMS cluded it in the authorization bill CONTRIBUTION TO THE INTERNATIONAL DEVELOPMENT ASSOCIATION For necessary expenses to carry out the passed by the full House on June 8. provisions of section 301 of the Foreign As- For payment to the International Develop- Also I note that because of the con- sistance Act of 1961, and of section 2 of the ment Association by the Secretary of the cern of the gentlewoman from New United Nations Environment Program Par- Treasury, $575,000,000, for the United States ticipation Act of 1973, $155,000,000: Provided, York, the committee report requires contribution to the tenth replenishment, to That none of the funds appropriated under that all candidates for expanded IMET remain available until expended. this heading shall be made available for the be carefully screened to make certain CONTRIBUTION TO THE INTER-AMERICAN they have not been involved in past United Nations Fund for Science and Tech- DEVELOPMENT BANK nology: Provided further, That funds appro- human rights abuses. I would hope For payment to the Inter-American Devel- priated under this heading may be made under those circumstances that the opment Bank by the Secretary of the Treas- available for the International Atomic En- gentlewoman would reconsider offering ury, for the United States share of the paid- ergy Agency only if the Secretary of State her amendment in light of the commit- in share portion of the increase in capital determines (and so reports to the Congress) tee’s action on this very important stock, $25,950,000. that Israel is not being denied its right to amendment. LIMITATION ON CALLABLE CAPITAL participate in the activities of that Agency: Mrs. LOWEY. Mr. Chairman, will the SUBSCRIPTIONS Provided further, That none of the funds ap- The United States Governor of the Inter- propriated under this heading that are made gentleman yield? available to the United Nations Population Mr. CALLAHAN. I yield to the gen- American Development Bank may subscribe without fiscal year limitation to the callable Fund (UNFPA) shall be made available for tlewoman from New York. capital portion of the United States share of activities in the People’s Republic of China: Mrs. LOWEY. Mr. Chairman, before I such capital stock in an amount not to ex- Provided further, That not more than do, I want to thank the gentleman ceed $1,523,000,000. $25,000,000 of the funds appropriated under again and commend him for his out- this heading may be made available to the CONTRIBUTION TO THE ASIAN DEVELOPMENT UNFPA: Provided further, That not more standing leadership of this committee. BANK than one-half of this amount may be pro- It has really been a privilege for me For payment to the Asian Development vided to UNFPA before March 1, 1996, and to work with the gentleman. He has Bank by the Secretary of the Treasury for that no later than February 15, 1996, the Sec- been open. He has worked in a biparti- the United States share of the paid-in por- retary of State shall submit a report to the san way. He has approached each issue tion of the increase in capital stock, Committees on Appropriations indicating $13,200,000, to remain available until ex- the amount UNFPA is budgeting for the Peo- in a very thoughtful manner. I want to pended. thank the gentleman, again, and the ple’s Republic of China in 1996: Provided fur- ther, That any amount UNFPA plans to ranking member, the gentleman from LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS spend in the People’s Republic of China in Texas [Mr. WILSON]. The United States Governor of the Asian 1996 about $7,000,000, shall be deducted from In response to the gentleman’s re- Development Bank may subscribe without the amount of funds provided to UNFPA quest, I do want to ask unanimous con- fiscal year limitation to the callable capital after March 1, 1996 pursuant to the previous sent to withdraw the amendment. Mr. portion of the United States share of such provisos: Provided further, That with respect Chairman, we will be watching ex- capital stock in an amount not to exceed to any funds appropriated under this heading panded IMET for Indonesia over the $647,000,000. that are made available to UNFPA, UNFPA shall be required to maintain such funds in a CONTRIBUTION TO THE ASIAN DEVELOPMENT next year. And if the human rights separate account and not commingle them FUND records does not improve, we will work with any other funds: Provided further, That to cut off all IMET funding next year. For the United States contribution by the up to $13,000,000 may be made available to Mrs. LOWEY. Mr. Chairman, I ask Secretary of the Treasury to the increases in the Korean Peninsula Energy Development resources of the Asian Development Fund, as Organization (KEDO) for administrative ex- unanimous consent to withdraw the authorized by the Asian Development Bank amendment. penses and heavy fuel oil costs associated Act, as amended (Public Law 89–369), with the Framework Agreement: Provided The CHAIRMAN. Is there objection $167,960,000, to remain available until ex- further, That additional funds may be made to the request of the gentlewoman pended. available to KEDO subject to the regular no- from New York? CONTRIBUTION TO THE EUROPEAN BANK FOR tification procedures of the Committees on There was no objection. RECONSTRUCTION AND DEVELOPMENT Appropriations. The CHAIRMAN. Are there other For payment to the European Bank for Re- The CHAIRMAN. Are there amend- amendments to title III? construction and Development by the Sec- ments to title IV? retary of the Treasury, $69,180,000, for the If not, the Clerk will designate title United States share of the paid-in share por- AMENDMENT OFFERED BY MR. DE LAY IV. tion of the initial capital subscription, to re- Mr. DELAY. Mr. Chairman, I offer an The text of title IV is as follows: main available until expended: Provided, amendment. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6365 The CHAIRMAN. The Clerk will des- forming these abuses by including responsibility to this country and to ignate the amendment. locals in the decision-making process the world. If we are going to be a par- The text of the amendment is as fol- but the independent GEF report called ticipant in the world of international lows: this claim a ‘‘biased exaggeration, if affairs, we are going to have to recog- Amendment offered by Mr. DELAY: Page 29, not falsification.’’ nize that global environment has to be line 1, strike ‘‘$50,000,000’’ and insert ‘‘0’’. The independent review led to a re- a part of that. In trying to put together Mr. DELAY. Mr. Chairman, the structuring process that was sup- the bill, we did assemble a bill that was amendment I am offering today with posedly completed in March of 1994. very fragile. Each side compromised. I my colleague, the gentleman from Ari- And my colleagues who support this in- gave a little, the minority gave a little. zona, eliminates funding for the Global stitution will probably argue that the We let everyone have as much input as Environment Facility or the GEF. GEF has made progress since this re- we possibly could. The GEF was created in 1991 to pay port. But I submit to my colleagues Mr. Chairman, as the gentleman from cash to Third World governments to that such assertions serve little more Texas [Mr. DELAY], will recognize, we stop local people from escaping poverty than the political purposes of those cut the facility from $110 million to $50 through development that could harm who seek the ‘‘environmental’’ cover of million. I thought that was a com- the environment at some point in the the GEF. promise. I cannot, as eloquently as future—a difficult concept to grasp According to Probe International, a some who may follow me, stand up and when you consider that the everyday Canadian environmental group that defend the GEF. I can defend the frag- concerns of these countries are not has monitored the GEF for four years, ile agreement that we have, the agree- about climate change but survival, ‘‘The restructured GEF remains as ment that I put together that says if clean drinking water and reduced food flawed as its predecessor and, as a clos- we will create child survival funds, if spoilage. er examination of some of its projects we will place our priorities on child In 1992, the GEF was made the fund- shows, does nothing to protect the survival, if we will reduce the level of ing mechanism to help poor countries global environment.’’ overall spending, then I would com- finance projects in compliance with the Despite such obvious reasons to be promise and go along with this request, environmental conventions agreed to extremely concerned with sending tax- provided they let me cut it from $110 at the Rio summit dealing with such payer dollars to this operation, the Ad- million down to $50 million. scientifically questionable—yet ministration pledged last March to Therefore, I commend the gentleman trendy—environmental ‘‘calamities’’ send a total of $430 million to the GEF for the message that he gave, but I re- such as global warming and over four years—the largest amount of luctantly rise in opposition to his biodiversity loss. any donor nation. amendment. Ms. PELOSI. Mr. Chairman, I move I say to my colleagues that what this In FY95, the U.S. gave the GEF an- to strike the last word. program really is, is a global giveaway other $90 million. This year’s request for poor countries—it gives developing Mr. Chairman, I rise in opposition to from the Administration is a com- the amendment. It is with great reluc- countries a refund for the economic re- pletely unsupportable $110 million. You strictions imposed on them in the UN tance and in admiration for the maker would think that the Administration that I rise to oppose his amendment to ‘‘biodiversity’’ and ‘‘climate change’’ believes the GEF has been an strike the additional funds over and conventions. This program is flawed unheralded success. above the funds the committee has al- because its fundamental design is I commend the chairman of the For- ready struck from the GEF. wrong. eign Operations subcommittee for rec- Mr. Chairman, I think it is important A scathing report on the GEF’s ac- ognizing the extremely questionable for our colleagues to know, and many tivities—called for after loud com- activities of this project and reducing are very familiar and have worked on plaints from environmental groups and the funding for the GEF to $50 million the Global Environmental Facility, donor countries to the GEF—basically in this bill. But, I submit to my col- otherwise known as GEF, that it is a found that the GEF’s operations are leagues that the GEF is a fundamen- multilateral fund dedicated to the ‘‘dysfunctional’’ and its accountability tally flawed and unaccountable organi- preservation of the global environ- is ill-defined. zation and certainly not an area where ment. It funds projects that help devel- The report found that the fundamen- this Congress should be allocating oping countries deal with environ- tal purpose of the GEF, that being scarce tax-dollars. mental problems that affect all coun- dedicating funds to climate change, Not only does eliminating funding for tries, including the United States. biodiversity, international waters, and the GEF make sense and save the tax- Indeed, we have heard over and over ozone depletion is ‘‘rather obscure in payers hundreds of millions of tax dol- again that environmental degradation nature.’’ lars, but it will also have the effect of and air pollution and water pollution The GEF has also been severely criti- slowing the implementation of global know no boundaries. Effects of develop- cized as a ‘‘green’’ slush fund for the environmental policies that do more to ment, such as loss of the forest and World Bank. On this, the independent restrict economic opportunity in poor wild species, ozone depletion, and pol- report concluded that the World Bank countries than to promote environ- lution of international waters, are ob- controls the lion’s share of the GEF’s mental conservation. viously not limited to the country resources and that is fundamentally The only responsible move for this where they occur. using GEF as a device to make its own Congress is to put a halt to the mil- Mr. Chairman, the Bush and Clinton regular projects look ‘‘greener’’ and to lions of taxpayer dollars we send to administrations both supported the mitigate criticism alleging World Bank this flawed institution. I urge my col- GEF because meeting these threats is insensitivity to environmental con- leagues to support this effort. so important. Projects funded by the cerns. b GEF help prevent the loss of forests Take a look at how the GEF is actu- 2000 and threatened plant and animal spe- ally performing its obscure role: you’ll Mr. CALLAHAN. Mr. Chairman, I cies. They help prevent pollution of find that it has done more to upset the rise in opposition to the amendment. international waters, threatening fish environmental and social balances in Mr. Chairman, to rise in opposition species on which the world depends. developing countries than to clean to the gentleman’s amendment is cer- Mr. Chairman, it is interesting to things up. As of last year, over half of tainly a first for me, because we have note what other countries are contrib- the GEF’s projects had provoked clash- voted 99 percent of the time together uting to the GEF, because this is an es over forced resettlement of displaced since we first came to this House 10 international effort, not just one fund- local people. years ago. ed by the U.S. Other donors’ pledges The report concluded that the However, during the process of the are related to ours in a burden-sharing premise of the GEF’s mandate—putting responsibility I assumed on this sub- arrangement. For example, Japan re- emphasis on global environmental committee as its chairman, I think it cently increased GEF funding over a 4- problems over local ones—is a ‘‘serious became very, very important that we year period to $500 million, substan- weakness.’’ The GEF claimed it was re- recognize that this subcommittee has a tially more than the United States H 6366 CONGRESSIONAL RECORD — HOUSE June 27, 1995 even before the recent reduction. Ger- Mr. Chairman, our chairman, the been put in place. That is the conclu- many will give $240 million over the gentleman from Alabama [Mr. CAL- sion of this report. same period. Further reducing GEF LAHAN], under his leadership, the GEF Let me tell the Members why. Is it in funding risks unraveling the GEF, and was cut substantially, in recognition of fact protecting the environment? It is with it our efforts to bring developing the budget and fiscal realities that we not. Its record is fundamentally flawed. countries into the global effort to safe- had to face. However, the value that he The report talks about ‘‘The Tana guard our environment. placed on it I think is one that is ap- River Primate Reserve in Kenya, a $6.2 Mr. Chairman, the GEF operates the propriate in these tough fiscal times, million project to protect two Endan- three implementing agencies. Our col- and I would hope that the membership gered Species Act of monkeys.’’ league has pointed out some concerns of this body would support the chair- However, as my colleague pointed that he had about the way the GEF has man’s mark and reject the amendment out, it is a failed proposal. It is a pro- functioned, but I think he is aware, and proposed by the gentleman from Texas posal to resettle 50,000 farmers of the if not, I am pleased to inform him that [Mr. DELAY]. Pokomo tribe. The GEF’s desire to re- the governance of the GEF has been Mr. SHADEGG. Mr. Chairman, I settle this community, however, as is changed substantially since criticisms move to strike the requisite number of often the case, flies in the face of the were lodged against it. The structure words. evidence, the evidence that the and governance of GEF have been criti- Mr. Chairman, I rise to support the Pokomo people not only co-existed cized in the past, it is true. amendment. It is with great respect, with this endangered species and pro- In response to an independent evalua- Mr. Chairman, that I rise to oppose the tected them for centuries, but also in- tion of the GEF pilot phase, which chairman of the subcommittee, the troduced them to Kenya, and when the ended in December 1993, the GEF has gentleman from Alabama [Mr. CAL- danger to the environment of these been completely overhauled and re- LAHAN], and with great respect for the monkeys became known, it was the structured. Under U.S. leadership, a proponent of this amendment, the gen- Pokomo tribe that made it clear to the fully independent GEF Secretariat has tleman from Texas [Mr. DELAY]. scientists. been set up in Washington under the The truth is, as the gentleman from Mr. Chairman, why does the GEF leadership of a U.S. citizen. A GEF Alabama [Mr. CALLAHAN] said, we do propose to move them? The report de- council consisting of major donors, in- have a responsibility to the global en- tails the facts. In fact, by claiming cluding the United States and develop- vironment. As my colleague from the that the local people are a threat to ing countries’ constituencies, is meet- other side said, indeed, the Global En- the monkeys, what is happening is the ing four times annually to review vironment Facility may in fact be GEF is conveniently hiding the fact project proposals, set policy, check im- dedicated to preservation of the envi- that there are two other failed World plementing agency performance, and ronment, but the simple truth is it is Bank projects that are hurting the real overall GEF effectiveness. an unabashed failure. It has not done environment for these monkeys. The what it proposed to do. two projects are the Kiambere Dam I go into this detail, Mr. Chairman, Mr. Chairman, as a member of the and the Bura Irrigation Project, both to point out that the overall govern- Committee on the Budget, I rise to say World Bank projects that are over ance of the GEF has been overhauled, enough is enough. We must have the budget disasters, and have so radically very specifically. A comprehensive strength to say no to continuing to altered the Tana River’s flow that the project monitoring system has been fund bad programs, even if they are future of the monkeys is in danger. created. In addition, the GEF Secretar- dedicated to worthy causes. Mr. Chairman, the truth is the GEF iat consults biannually, and I think Last month the national debt of the is there to cover up and add a green this is very important, because it gives United States grew by over $1 billion tint to failed World Bank projects. In transparency and public participation per day. We simply cannot continue to an environment such as we have today, to it, to a wide range of environmental leave that legacy to our children. We where funds are so scarce, we simply and indigenous groups. cannot leave it in the name of failed cannot go on funding programs like the Project development has been programs like the Global Environment GEF. streamlined. There is strong U.S. eco- Facility. Let me explain why I call it a This amendment is supported, be- nomic interest involved as well. U.S. failure, and why I call upon my col- cause it would save $50 million this industries and consumers who have a leagues to support the amendment of- year and $400 million over the course of substantial interest in conservation of fered by the gentleman from Texas the next 4 years, by Citizens Against biological and genetic diversity, with [Mr. DELAY] and to oppose any amend- Government Waste, Citizens for a its myriad commercial application in ments which simply reduce its funding. Sound Economy, the Small Business production of food, fiber, and medicine, Mr. Chairman, I hold before me a re- Survival Committee, the Competitive support the GEF. One fourth of all port prepared by an organization called Enterprise Institute, Americans for pharmaceutical prescriptions in this Probe International, out of Toronto, Tax Reform, Coalitions for America, country contain active ingredients de- Canada. Its title is ‘‘The World Bank’s the National Center for Public Policy rived from plants, many of which exist Persisting Failure to Reform.’’ It was Research, the Environmental Policy only in tropical forest areas whose written by John Thibodeau, and it is Task Force, the Association of Con- biodiversity values are facing rapid de- dated May, 1995. It documents in its cerned Taxpayers, Project 21, and Cato struction. first section that the Global Environ- Institute. By catalyzing technological advances ment Facility remains dysfunctional. Mr. Chairman, why do they all sup- in developing countries, the GEF helps It says, and I quote, ‘‘The review’’ of port it? Because it is an abject failure. expand export markets for U.S. firms. this program ‘‘was as scathing in its In this age, we cannot continue to sup- The GEF’s international waters port- evaluation’’ as possible, ‘‘revealing an port an abject failure, even at the folio has potential to prevent marine organization that was fundamentally minimal level. While I commend the pollution and to conserve some of the flawed and unaccountable. The review subcommittee chairman for reducing most economically and ecologically found that the reason for the existence the funding from a level that was pro- valuable species. of the Global Environment Facility posed to only the figure of $50 million, In conclusion, Mr. Chairman, I would was obscure, ‘‘that its operations were it is time to zero this project in the like to just sum up and say whether it dysfunctional and its accountability waste and keep the monies where they is for environmental reasons or eco- ill-defined; that the concept of incre- belong, in the United States. nomic reasons, or population reasons mental costs was a serious weakness.’’ AMENDMENT OFFERED BY MR. WILSON AS A SUB- in terms of avoiding the problem of en- It concluded with the following STITUTE FOR THE AMENDMENT OFFERED BY vironmental refugees that could result words, and this is an independent re- MR. DE LAY if we do not stop some of the degrada- view: ‘‘No further funds to new projects Mr. WILSON. Mr. Chairman, I offer tion that is happening in our environ- or programs should be made until such an amendment as a substitute for the ment, the GEF is a very good invest- time as strategies, policies, concentra- amendment. ment. tion areas, priorities, criteria’’ have The Clerk read as follows: June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6367 Amendment offered by Mr. WILSON as a technically first-rate, transparent to place, and thereby the Wilson amend- substitute for the amendment offered by Mr. the public, and responsive to its do- ment, which says that we should cut it DELAY: On page 29 line 1, delete ‘‘$50,000,000’’ nors. an additional $10 million, I think is ap- and insert ‘‘$40,000,000’’. Although some were skeptical early propriate, and I would strongly oppose Mr. WILSON. Mr. Chairman, the gen- on, with the improvements that have the amendment of the gentleman from tleman from Texas [Mr. DELAY] has de- been made every major environmental Texas [Mr. DELAY] and the gentleman leted $50 million. We zero the entire en- group now supports the GEF, and I from Arizona [Mr. SHADEGG] which terprise. My amendment offered as a have a letter here signed by 19 of them would cut out all the money. substitute would reduce the reduction opposing the DeLay amendment. It We have heard this evening that the in the bill by a further $10 million. In may surprise you, though, to know GEF secretariat consults biannually other words, instead of reducing the that many major U.S. corporations with a wide range of environmental entire $50 million, I would reduce it by also support the GEF. I have letters and indigenous groups. We have heard $10 million, leaving $40 million in the here from the chairman of the board of that this sort of participation is unique enterprise. Intel, Dwayne Andreas of Archer Dan- to the GEF among multilateral institu- Mr. Chairman, the GEF as we have iels Midland, and the vice chairman of tions. As a result, environmental heard before, provides an insurance the Mary Kay Corp. These corporations groups like the NRDC now endorse the policy to avoid the cost of future envi- support GEF because it protects GEF and support continued strong U.S. ronment degradation. The GEF pro- biodiversity, which they use to inno- participation. Project development motes the use of technology, of which vate in their fields, they sell environ- procedures have been streamlined. the United States is a leader. I could mental technology to countries for There has been extensive consultation name all of the reputable companies GEF projects, and they realize that with communities affected by GEF that consult with the GEF, that work protecting the environment is in our projects, and that is now required for on ozone substitutes and that work in best interest as human beings. every project. the biotechnology area. In addition, companies like Bechtel, Mr. Chairman, as this report sug- gests, there have been policies and pro- b 2015 Brooklyn Union Gas, and Texaco from the gentleman from Texas’ home State cedures put in place to ensure that this The Bush and Clinton administra- have participated in GEF projects. Du- money is spent wisely. tions have supported the GEF over Pont, GE, and Raytheon dominate the We have also heard that this has been more expensive alternatives. The GEF market for substitutes for ozone de- supported by the Bush administration was completely reorganized and over- pleting chemicals. And Merck and and the Clinton administration. I hauled in 1994, and I think that many Ciba-Geigy, pharmaceutical companies, would like to add my support to the of the problems that have been men- depend on the biodiversity protected by Wilson amendment and encourage my tioned here today have already been GEF for their future. colleagues to vote with me. addressed. As the gentleman from Texas knows, Mr. SHADEGG. Mr. Chairman, I I would again suggest that the sub- GEF mobilizes $5 for environmental move to strike the last word, and I rise committee, the Subcommittee on For- protection for every $1 the U.S. con- in opposition to the amendment offered eign Operations, has already cut the tributes. For the United States, GEF is by the gentleman from Texas [Mr. WIL- GEF by 50 percent. The cut that I am quite simply the most cost effective SON]. proposing would add another 10 per- means of avoiding environmental deg- Mr. Chairman, I understand the pro- cent, which would mean a 60 percent radation. No one—not AID, not the posal of those who seek to defend this cut in this multilateral organization U.N. Environment Program—no one program. I understand they claim that that I think still shows great promise can do what GEF does. the corrections have been made. The for the environment. There is precious little left in this report I read from, I did not have time Mr. Chairman, I would move the sub- bill to ensure that our children and to note its date. The report is a report stitute. grandchildren have the benefits of by an independent organization called Mr. PORTER. Mr. Chairman, I move clean air and water and access to Probe International based not out of to strike the last word. biodiversity for new drugs, chemicals the United States but out of Toronto, Mr. Chairman, I strenuously oppose and plant adaptations. The President’s Canada, and is dated May 1995. The sec- the amendment offered by my friend request for GEF was $110 million, we tion of the report which I read was the gentleman from Texas. I believe a appropriated $90 million last year, this from the independent review. That re- little history will help clarify for Mem- bill provides $50 million, and the DeLay view was concluded some time ago and bers why providing funds for the GEF amendment would eliminate funding. I it did point out the flaws which have makes sense. urge Members to oppose the DeLay been clearly acknowledged here, indeed The Global Environmental Facility amendment, provide the subsistence the numerous flaws which have been [GEF] was established in 1991 during level of funding contained in this bill clearly acknowledged in the GEF. But the Bush administration for a 3-year for the GEF and help protect these this is a current report which goes be- pilot phase designed to identify innova- treasures for the future. yond that, and says that notwithstand- tive approaches to conservation—to de- Mrs. LOWEY. Mr. Chairman, I rise in ing the claims of the environmental termine what works and what does not. support of the Wilson amendment. community, in point of fact the GEF is During the pilot phase, GEF was part (Mrs. LOWEY asked and was given not doing the job correctly today. I of the World Bank, but was run in co- permission to revise and extend her re- suggest indeed it is not. I suggest that operation with the U.N. Development marks.) as President Clinton called upon Amer- Program. In March 1994, at the end of Mrs. LOWEY. Mr. Chairman, I want ica and said we can do better, indeed the pilot phase, GEF became a free- to thank the gentleman from Arizona for those who are concerned about pro- standing international institution, de- [Mr. SHADEGG] for his comments re- tecting the global environment, we can signed to be arms length from existing garding the inappropriate policies that do far better than to add more money international bureaucracies and able to he referred to. However, I also want to to a failed World Bank-dominated pro- articulate a clear global environmental note that in the report to which you re- gram, a program which puts money in agenda. ferred, you specifically said, ‘‘until the hands of the rulers of third-world Much was learned after the pilot such time as new policies have been countries and does not achieve its phase and appropriate adjustments put in place.’’ In other words, the funds goals, a program which papers over were made. In 1993 and 1994, two envi- should be cut until such time as new World Bank projects which do serious ronmental organizations, Conservation policies have been put in place. environmental damage. I think it is International and Natural Resources I will not go on because you have important that this Congress have the Defense Council, conducted a major heard so much from my colleagues this courage to say ‘‘no,’’ not the courage evaluation of the GEF and made rec- evening. But I think we have received a to say, ‘‘oh, it failed so let’s give it a ommendations for the operational lot of information which clearly lays little less,’’ but the courage to say phase. GEF was overhauled and is now out changes that have been put in ‘‘no.’’ H 6368 CONGRESSIONAL RECORD — HOUSE June 27, 1995 With regard to my colleague from First of all, I would like to say to terminated. It went on a committee this side who said there is great cor- those that may not know, being a biol- level from $110 million down to $50 mil- porate support for this proposal, let me ogist and biochemist by education, I lion, and now to get rid of it com- suggest a fundamental flaw in that no- am here and stand here on the floor to pletely I think is absolutely inappro- tion. When he says that many cor- tell Members that global warming and priate and would be devastating. porate interests in America support ozone depletion are not proven. They As one of the founding members of a this idea and support funding for it, let are not proven concepts. They are group called GLOBE, Global Legisla- me point out their hypocrisy. The theories. No one, including the envi- tors for a Balanced Environment, I truth is when polluters pollute, they ronmentalists, can say with certainty must speak up for a multilateral fund should pay to clean it up, not the that this is a proven concept. This is a that was begun under the Bush admin- American taxpayer, and in this in- hope-that-it-does-not-happen concept. istration and has had continued sup- stance when he cites a series of Amer- It has never been proven. This is a con- port by the present administration. Op- ican corporations who think it is a cept designed on computer models by erating through three implementing wonderful idea for us to take American environmental activists. Yet we are agencies, the World Bank, the U.N. De- tax dollars and to deal with third-world spending millions if not billions of dol- velopment Programme, and the U.N. pollution, indeed, third-world pollution lars on a theory. That is why we were Environment Programme, the GEF which they themselves may have con- very concerned that Bush go to Rio to plays a crucial role in influencing tributed to, we set the cart before the get involved in this kind of issue. international environmental actions. horse. If the polluters have created the Yes, he signed a 3-year pilot. Well, We have here a unique fund dedicated pollution, they should be made to clean the pilot has crashed. This does not to the preservation of the global envi- it up, not the taxpayers of America, work, it is a fundamentally flawed con- ronment. Its projects include those in and not under a government program cept. Let me say to the Members that climate change, which affect crop- where you and I and my children and are interested in deficit reduction. We growing seasons, plant distribution, indeed with the debt we are creating, are not interested in ‘‘government- damage to coastal communities, and my grandchildren are compelled to pay light’’ that is an example of the amend- many others: ozone depletion, which if to clean it up, that creates all the ment of the gentleman from Texas. We it increases will increase our exposure wrong incentives. Then the polluter are interested in looking at programs to ultraviolet radiation and the attend- has no motivation to clean up because and those programs that can be done ant threat of malignant melanoma; the taxpayer is going to come along better and smarter, we want to do pollution of international waters, and bail him out. It simply is, as the them better and smarter, thereby real- which are already depleting our fish report I have read from, which is a sec- izing savings. But for programs like species, loss of forests, plants, and ani- ond report suggests, a failed program. the GEF that are fundamentally flawed mal species; and the list goes on. Mr. Chairman, let me simply con- and even environmental groups are Mr. Chairman, the United States clude with this point. If the best that saying it is flawed, we want to zero does not stand alone in supporting the the proponents of GEF can do is to ac- them out. GEF. With the proposed reduction to knowledge its failure, is to acknowl- Members have to vote against the $50 million, we will be going against edge that a year ago the environmental Wilson amendment in order to get to the international mainstream. Japan community, including the Environ- the DeLay-Shadegg amendment in has increased their contribution to $500 mental Defense Fund, criticized this order to zero it out. million over a 5-year period, and Ger- and acknowledged that it was a failure, Mr. Chairman, as far as the corpora- many will give $240 million over the if the best they can do is say, ‘‘Yes, it tions, all those Members that have same period. was poor before, but we’ve tried to im- called for the end of corporate welfare, To bow out of this important World prove, so give us, not $50 million but corporations support the GEF because Bank program completely is to abro- $30 million,’’ I suggest we can, as Bill GEF gives them green cover, and gate our responsibility, and I believe it Clinton said, do better, and we can do makes them look like they are envi- will be very counterproductive. Why do better by abolishing the funding and ronmentally sound. I am not here serv- I feel this way? Because the GEF is creating a new program, a new pro- ing in this body to protect corporations protecting the environment and gram that in fact makes polluters pay and give them taxpayers’ money to biodiversity where it is most valuable for the pollution and does not require make them look a little greener. That and most threatened, in the developing the American taxpayer to pay for their is what GEF does. countries of Africa, Asia, and Latin pollution or the pollution of other Mr. Chairman, I am just saying, this America. third-world governments. is a flawed program, it has not proven Frankly, if this attempt to further Mr. DELAY. Mr. Chairman, I move to itself at all, it is a flawed program try- reduce the funds, to eliminate them, is strike the requisite number of words, ing to control a flawed theory. I urge a a criticism of past governance, this has and I rise in opposition to the Wilson ‘‘no’’ vote on the Wilson amendment already been addressed. Under U.S. amendment. and a ‘‘yes’’ vote on the DeLay amend- leadership, a fully independent GEF Mr. Chairman, I will try not to take ment. secretariat has been set up in Washing- the 5 minutes. I think it is important Mr. WILSON. Mr. Chairman, I have ton under the leadership of a U.S. citi- for those Members that are listening to been overwhelmed by the eloquence of zen. A comprehensive project monitor- understand what is going on here. It is my colleague, the gentleman from ing system has been created under this obvious to me that the gentleman from Texas. secretariat to ensure that projects Texas, my good friend, is trying to Mr. Chairman, I ask unanimous con- meet cost and performance goals from block zeroing out a failed agency be- sent to withdraw my substitute amend- start to finish. Many of these manage- cause it has failed on a failed concept. ment. ment changes are unique to the GEF The gentleman from Illinois was The CHAIRMAN. Is there objection among multilateral institutions. right in pointing out that former Presi- to the request of the gentleman from To further reduce funding of the dent Bush went to Rio and worked on Texas? Global Environmental Facility would the Rio summit and committed us to There was no objection. be to jeopardize bringing developing certain things. Before the President countries to the global effort to safe- b left, many of us, and many of us in 2030 guard our environment. Really, too leadership urged the President not to Mrs. MORELLA. Mr. Chairman, I much is at stake. I strongly urge my go because this summit would lead to move to strike the requisite number of colleagues to support the GEF, it has bad things. words. already been reduced to the extent it is This is a perfect example of proving Mr. Chairman, I rise in opposition to determined in the bill, and to vote us right. This is a feel-good organiza- the well-intentioned DeLay amend- against the DeLay amendment. tion that has no substance in its abil- ment. I find it very difficult, Mr. Chair- As Shakespeare said, ‘‘To nature ity to clean up calamities as outlined man, to be here and watch the Global none more bound,’’ and we must re- in the Rio summit. Environmental Facility be absolutely member that. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6369 Mr. GILCHREST. Mr. Chairman, I What about biological diversity in I support the efforts of an impressive move to strike the requisite number of the first place? You cannot name a dis- list of people and groups that support words. ease in this country that does not have the amendment put forth by the major- Mr. Chairman, I reluctantly rise a potential cure as a result of finding ity whip and the gentleman from Ari- against the amendment offered by the some chemical agent in some species zona [Mr. SHADEGG]. These include Gro- gentleman from Texas [Mr. DELAY]. around the planet. That is just as a re- ver Norquist’s group, Americans for But I would like to speak for just a few sult of our understanding for renewed Tax Reform, the Cato Institute, Citi- minutes on the positive impacts of the molecular technology advancements in zens for a Sound Economy, the Com- Global Environmental Fund. this country today. petitive Enterprise Institute, and a A number of my colleagues have From an endangered species called host of other responsible groups. The mentioned a number of things here the rosy periwinkle, a small little en- GEF is a global giveaway that cannot about tropical rain forests, global fish- dangered flower, they extracted a be justified, particularly given our Na- eries, biological diversity, global chemical agent that now cures or sets tion’s fiscal crisis, and it has even warming, ozone depletion, and things aside 80 percent of childhood leukemia. failed its stated goal, improving the like that. These are not abstract con- Why is this particular plant impor- environment. The GEF should RIP. cepts. These are not things that are tant? Because it cures disease. Also, we Mr. SCARBOROUGH. Mr. Chairman, proven beyond a shadow of a doubt to have not been able to synthesize that will the gentleman yield? have impact on our Nation or the world chemical agent, so we need that par- Mr. SALMON. I yield to the gen- as a whole. ticular plant. tleman from Florida. When we are dealing with scientific Whether it is heart attacks, high Mr. SCARBOROUGH. Mr. Chairman, realities, there are always certain sci- blood pressure, cancer, glaucoma, a I think the environment won an impor- entific uncertainties, but I want to whole range of diseases, we are finding tant battle today as there was an ex- start from this list and make a couple agents in particular plants for these tension on the moratorium for drilling of comments. particular diseases to be cured. off the coast of this country. That was The nations of the world’s forests, The Global Environmental Fund is a something I supported. It was some- the rain forests of the world, are a small investment, folks, for a major thing other environmentalists sup- storehouse of medical potential break- discovery. Global warming, has it been ported. And as an environmentalist, throughs that will not only benefit us proved? No. Has it been disproved? No. though, I cannot rise and support as citizens today, but future genera- But I will tell my colleagues, the major something like this. Resources are so tions to come. What are the major scientists of this country, if we talk to scarce in our battle for cleaning up the pharmaceutical companies of the an independent scientist from Harvard environment that we cannot continue to throw money away at a failed PR ef- world, especially in the United States, or Cornell or Yale or whatever that is fort for the World Bank. American companies included, doing in not linked with any environmental You now, Bismarck once said you can tropical rain forests now? I will give group, they would say, ‘‘Hedge your do anything with children so long as you one example. bets, it might be happening.’’ you play with them. Well, that is ex- Merck & Co. has signed an agreement What about ozone depletion? Is there actly what the World Bank is doing. partially through the link with the an increase in the incidence of skin They are playing a PR game here be- Global Environmental Fund to bring cancer? Are doctors telling you to stay cause they want to come off looking these two countries, the United States out of the sun? The answer is yes. I re- good. and Costa Rica, together. Costa Rica luctantly ask my colleagues to vote no If they want to spend their own has decided to set aside 25 percent of on the amendment. money, that is fine, but when they their entire country so a U.S. pharma- AMENDMENT OFFERED BY MR. PORTER TO THE spend our money for their own PR ceutical firm can go down there and AMENDMENT OFFERED BY MR. DELAY games, it is not only the taxpayer that study the biology and the biodiversity Mr. PORTER. Mr. Chairman, I offer loses, but it is the environment that of that country’s species, flora and an amendment to the amendment. loses. If we as a body decide that we fauna, that means the animals and the The Clerk read as follows: need to spend money cleaning up the plants, to try to extract chemical Amendment offered by Mr. PORTER to the environment of this country, then let agents to cure diseases around the E AY amendment offered by Mr. D L : us make sure that we invest our dollars world that are becoming resistant to At the appropriate place, strike ‘‘0’’ and in- wisely. We cannot continue in this antibiotics today. sert in lieu thereof ‘‘$30,000,000’’. hoax, in this PR game. These are going to be the cures for Mr. PORTER. Mr. Chairman, I will Mr. Chairman, we should support the tomorrow. What does that mean to not take 5 minutes because I have al- DeLay-Shadegg amendment and clean Merck & Co. as a result of this connec- ready spoken on the DeLay amend- up this country for our children. tion? It means literally billions of dol- ment, but while I was off the floor, I Mr. DELAY. Mr. Chairman, will the lars. understand that the gentleman from gentleman yield? So if we are looking at the Global Texas [Mr. WILSON] had withdrawn his Mr. SALMON. I yield to the gen- Environmental Fund and saying that it amendment at $40 million. I simply tleman from Texas. is not worth the few dollars that we are would like to offer this amendment for Mr. DELAY. Mr. Chairman, I thank going to put into it, talk with the the consideration of the Members, the gentleman for yielding. pharmaceutical companies of this where the DeLay amendment would be I just asked for this time to explain country and they will tell you it is reduced from zeroing out GEF so that to the Members where we are. Even if worth billions for Merck. It is worth it would leave $30 million in that ac- we wanted to do the great things that hundreds of billions for the other phar- count. the gentleman from Maryland claims maceutical companies in this country Mr. SALMON. Mr. Chairman, I move that the GEF does, which I dispute, and for the emerging biotechnology to strike the last word. this is a waste of money, $30 million. It companies of this country. Mr. Chairman, I see some great will go to bureaucrats. It will go the The global fisheries. If we just looked progress being made here. I understand World Bank. It will not do anything. at the United States, 70 percent of the it started at 110 million then it was at So I urge the Members to understand commercial fish that we harvest are 50, then at 40, now at 30. I think we are the vote. The vote that I am urging is spawned in tidal estuaries. What does almost there. a no vote on the Porter amendment to GEF, the Global Environmental Fund, But I would like to say this: I have the DeLay amendment. Defeat that do? It helps other countries realize the heard the evidence on both sides of the and then vote for the DeLay amend- necessity of protecting their tidal equation, and other than the side that ment. marshes for the main protein source of wants to preserve funding saying, The CHAIRMAN. The question is on the entire world. So for the few invest- ‘‘Trust me, I am from the Government, the amendment offered by the gen- ment dollars that we put into GEF, the I am here to help you,’’ I have not tleman from Illinois [Mr. PORTER] to Global Environmental Fund, we reap found any compelling reasons to sup- the amendment offered by the gen- huge profits. port this boondoggle. tleman from Texas [Mr. DELAY]. H 6370 CONGRESSIONAL RECORD — HOUSE June 27, 1995

The question was taken; and the Tanner Tucker Waxman tleman from Texas [Mr. DELAY], as Chairman announced that the noes ap- Tejeda Upton Weldon (PA) amended. Thomas Velazquez Whitfield peared to have it. Thompson Vento Wilson The question was taken; and the RECORDED VOTE Thornton Visclosky Wise Chairman announced that the noes ap- Thurman Volkmer Wolf peared to have it. Mr. PORTER. Mr. Chairman, I de- Torkildsen Walsh Woolsey RECORDED VOTE mand a recorded vote. Torres Ward Wyden Towns Waters Wynn Mr. DELAY. Mr. Chairman, I demand A recorded vote was ordered. Traficant Watt (NC) The CHAIRMAN. Pursuant to clause a recorded vote. 2 of rule XXIII, the Chair will reduce to NOES—180 A recorded vote was ordered. a minimum of 5 minutes the timer for Allard Gallegly Myrick The CHAIRMAN. This is a 5-minute Archer Ganske Nethercutt vote. a recorded vote, if ordered, on the Bachus Geren Neumann original DeLay amendment if there is Baesler Gillmor Ney The vote was taken by electronic de- no intervening business or debate fol- Baker (CA) Goodlatte Norwood vice, and there were—ayes 273, noes 146, Baker (LA) Graham Nussle not voting 15, as follows: lowing the 15-minute vote on the Por- Ballenger Gutknecht Oxley ter amendment. This will be a 17- Barr Hall (TX) Packard [Roll No. 427] minute vote. Barrett (NE) Hancock Paxon AYES—273 Bartlett Hansen Petri The vote was taken by electronic de- Barton Hastert Pickett Allard Fields (TX) Manzullo vice, and there were—ayes 242, noes 180, Bilirakis Hastings (WA) Pombo Archer Flanagan Martinez not voting 12, as follows: Bliley Hayes Portman Baesler Foley Martini Boehner Hayworth Quillen Baker (CA) Fowler Mascara [Roll No. 426] Bonilla Hefley Radanovich Baker (LA) Fox McCollum Ballenger Franks (CT) McCrery AYES—242 Bono Heineman Ramstad Brewster Herger Roberts Barcia Franks (NJ) McDade Abercrombie Forbes McHale Brownback Hilleary Rogers Barr Frisa McHugh Ackerman Ford McKinney Bryant (TN) Hobson Rohrabacher Barrett (NE) Funderburk McInnis Andrews Fowler McNulty Bunn Hoekstra Roth Barrett (WI) Gallegly McIntosh Baldacci Fox Meehan Bunning Hoke Royce Bartlett Ganske McKeon Barcia Frank (MA) Meek Burr Hostettler Salmon Barton Gekas Meehan Barrett (WI) Franks (CT) Menendez Burton Hunter Sanford Bass Geren Menendez Bass Franks (NJ) Meyers Buyer Hutchinson Scarborough Bateman Gibbons Metcalf Bateman Frelinghuysen Mfume Calvert Hyde Schaefer Bereuter Gillmor Meyers Becerra Frost Miller (CA) Canady Inglis Seastrand Bevill Goodlatte Mica Beilenson Gejdenson Mineta Chabot Istook Sensenbrenner Bilbray Goodling Miller (FL) Bentsen Gekas Minge Chambliss Jacobs Shadegg Bilirakis Gordon Minge Bereuter Gibbons Mink Chapman Johnson, Sam Shuster Bliley Goss Molinari Berman Gilchrest Molinari Chenoweth Jones Sisisky Blute Graham Mollohan Bevill Gilman Mollohan Christensen Kasich Skeen Boehner Greenwood Montgomery Bilbray Gonzalez Moran Chrysler Kim Smith (MI) Bonilla Gutknecht Moorhead Bishop Goodling Morella Coble King Smith (TX) Bono Hall (TX) Murtha Blute Gordon Murtha Coburn Kingston Smith (WA) Boucher Hamilton Myers Boehlert Goss Nadler Collins (GA) Knollenberg Solomon Brewster Hancock Myrick Bonior Green Neal Combest LaHood Souder Browder Hansen Neal Borski Greenwood Oberstar Cooley Largent Spence Brown (FL) Hastert Nethercutt Boucher Gutierrez Obey Cox Latham Stearns Brown (OH) Hastings (WA) Neumann Browder Hall (OH) Olver Crane Laughlin Stenholm Brownback Hayes Ney Brown (CA) Hamilton Ortiz Crapo Lewis (CA) Stockman Bryant (TN) Hayworth Norwood Brown (FL) Harman Orton Cremeans Lewis (KY) Stump Bunn Hefley Nussle Brown (OH) Hastings (FL) Owens Cubin Lightfoot Talent Bunning Hefner Orton Callahan Hefner Pallone Cunningham Linder Tate Burr Heineman Oxley Cardin Hilliard Parker Deal Livingston Tauzin Burton Herger Packard Castle Hinchey Pastor DeLay LoBiondo Taylor (MS) Buyer Hilleary Parker Clay Holden Payne (NJ) Dickey Lofgren Taylor (NC) Callahan Hobson Paxon Clayton Horn Payne (VA) Doolittle Lucas Thornberry Calvert Hoekstra Peterson (FL) Clement Houghton Pelosi Dornan Manzullo Tiahrt Canady Hoke Peterson (MN) Clinger Hoyer Peterson (FL) Dreier McCollum Vucanovich Chabot Holden Petri Clyburn Jackson-Lee Peterson (MN) Duncan McCrery Waldholtz Chambliss Hostettler Pickett Coleman Jefferson Pomeroy Dunn McHugh Walker Chapman Houghton Pombo Collins (IL) Johnson (CT) Porter Ehrlich McInnis Wamp Chenoweth Hunter Pomeroy Collins (MI) Johnson (SD) Poshard Emerson McIntosh Watts (OK) Christensen Hutchinson Portman Condit Johnson, E. B. Pryce Ensign McKeon Weldon (FL) Chrysler Hyde Poshard Conyers Johnston Quinn Ewing Metcalf Weller Clement Inglis Pryce Costello Kanjorski Rahall Fields (TX) Mica White Clinger Istook Quinn Coyne Kaptur Rangel Flanagan Miller (FL) Wicker Coble Jacobs Radanovich Cramer Kelly Reed Foley Montgomery Young (AK) Coburn Johnson (SD) Rahall Danner Kennedy (MA) Regula Frisa Moorhead Young (FL) Collins (GA) Johnson, Sam Ramstad Davis Kennedy (RI) Richardson Funderburk Myers Zeliff Combest Jones Regula de la Garza Kennelly Riggs Condit Kanjorski Riggs DeFazio Kildee Rivers NOT VOTING—12 Cooley Kaptur Roberts DeLauro Kleczka Roemer Cox Kasich Roemer Armey Gephardt Torricelli Dellums Klink Ros-Lehtinen Cramer Kelly Rogers Bryant (TX) Gunderson Williams Deutsch Klug Rose Crane Kim Rohrabacher Camp Moakley Yates Diaz-Balart Kolbe Roukema Crapo King Ros-Lehtinen Furse Reynolds Zimmer Dicks LaFalce Roybal-Allard Cremeans Kingston Rose Dingell Lantos Rush b 2104 Cubin Kleczka Roth Dixon LaTourette Sabo Cunningham Klink Roukema Doggett Lazio Sanders Messrs. RADANOVICH, ALLARD, Danner Klug Royce Dooley Leach Sawyer ROYCE, DUNCAN, LEWIS of Califor- Deal Knollenberg Salmon Doyle Levin Saxton DeLay Kolbe Sanford Durbin Lewis (GA) Schiff nia, CHABOT, MCINNIS, PACKARD, Diaz-Balart LaHood Scarborough Edwards Lincoln Schroeder and PORTMAN changed their vote Dickey Largent Schaefer Ehlers Lipinski Schumer from ‘‘aye’’ to ‘‘no.’’ Doolittle Latham Seastrand Engel Longley Scott Messrs. JEFFERSON, JOHNSON of Dornan LaTourette Sensenbrenner English Lowey Serrano Doyle Laughlin Shadegg Eshoo Luther Shaw South Dakota, BALDACCI, STUPAK, Dreier Lewis (CA) Shaw Evans Maloney Shays TUCKER, and FORBES changed their Duncan Lewis (KY) Shays Everett Manton Skaggs vote from ‘‘no’’ to ‘‘aye.’’ Dunn Lightfoot Shuster Farr Markey Skelton Edwards Lincoln Sisisky Fattah Martinez Slaughter So the amendment to the amendment Ehrlich Linder Skeen Fawell Martini Smith (NJ) was agreed to. Emerson Lipinski Skelton Fazio Mascara Spratt The result of the vote was announced English Livingston Smith (MI) Fields (LA) Matsui Stark as above recorded. Ensign LoBiondo Smith (TX) Filner McCarthy Stokes Everett Longley Smith (WA) Flake McDade Studds The CHAIRMAN. The question is on Ewing Lucas Solomon Foglietta McDermott Stupak the amendment offered by the gen- Fawell Luther Souder June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6371 Spence Thornberry Wamp made available by this Act shall be obligated tarian assistance and for democracy-building Stearns Thornton Ward during the last month of availability. purposes. Stenholm Thurman Watts (OK) Stockman Tiahrt Weldon (FL) PROHIBITION OF BILATERAL FUNDING FOR MILITARY COUPS Stump Torkildsen Weller INTERNATIONAL FINANCIAL INSTITUTIONS SEC. 508. None of the funds appropriated or Talent Traficant White SEC. 502. None of the funds contained in otherwise made available pursuant to this Tanner Upton Whitfield title II of this Act may be used to carry out Act shall be obligated or expended to finance Tate Visclosky Wicker the provisions of section 209(d) of the For- Tauzin Volkmer Wise directly any assistance to any country whose eign Assistance Act of 1961. Taylor (MS) Vucanovich Wolf duly elected Head of Government is deposed Taylor (NC) Waldholtz Young (AK) LIMITATION ON RESIDENCE EXPENSES by military coup or decree: Provided, That Tejeda Walker Young (FL) SEC. 503. Of the funds appropriated or made assistance may be resumed to such country Thomas Walsh Zeliff available pursuant to this Act, not to exceed if the President determines and reports to NOES—146 $126,500 shall be for official residence ex- the Committees on Appropriations that sub- Abercrombie Frost Obey penses of the Agency for International De- sequent to the termination of assistance a Ackerman Gejdenson Olver velopment during the current fiscal year: democratically elected government has Andrews Gilchrest Ortiz Provided, That appropriate steps shall be taken office. Baldacci Gilman Owens taken to assure that, to the maximum ex- TRANSFERS BETWEEN ACCOUNTS Becerra Gonzalez Pallone tent possible, United States-owned foreign Beilenson Green Pastor currencies are utilized in lieu of dollars. SEC. 509. None of the funds made available Bentsen Gutierrez Payne (NJ) LIMITATION ON EXPENSES by this Act may be obligated under an appro- Berman Hall (OH) Payne (VA) priation account to which they were not ap- Bishop Harman SEC. 504. Of the funds appropriated or made Pelosi propriated, except for transfers specifically Boehlert Hastings (FL) Porter available pursuant to this Act, not to exceed provided for in this Act, unless the Presi- Bonior Hilliard Quillen $5,000 shall be for entertainment expenses of dent, prior to the exercise of any authority Borski Hinchey Rangel the Agency for International Development Brown (CA) Horn contained in the Foreign Assistance Act of Reed during the current fiscal year. Cardin Hoyer Richardson 1961 to transfer funds, consults with and pro- Castle Jackson-Lee Rivers LIMITATION ON REPRESENTATIONAL vides a written policy justification to the Clay Jefferson Roybal-Allard ALLOWANCES Committees on Appropriations of the House Clayton Johnson (CT) Rush SEC. 505. Of the funds appropriated or made Clyburn Johnson, E. B. of Representatives and the Senate: Provided, Sabo Coleman Johnston available pursuant to this Act, not to exceed That the exercise of such authority shall be Sanders Collins (IL) Kennedy (MA) $95,000 shall be available for representation subject to the regular notification proce- Sawyer Collins (MI) Kennedy (RI) allowances for the Agency for International dures of the Committees on Appropriations, Saxton Conyers Kennelly Development during the current fiscal year: except for transfers specifically referred to Costello Kildee Schiff Schroeder Provided, That appropriate steps shall be in this Act. Coyne LaFalce taken to assure that, to the maximum ex- Davis Lantos Schumer DEOBLIGATION/REOBLIGATION AUTHORITY tent possible, United States-owned foreign de la Garza Lazio Scott DeFazio Leach Serrano currencies are utilized in lieu of dollars: Pro- SEC. 510. Amounts certified pursuant to DeLauro Levin Skaggs vided further, That of the funds made avail- section 1311 of the Supplemental Appropria- Dellums Lewis (GA) Slaughter able by this Act for general costs of admin- tions Act, 1955, as having been obligated Deutsch Lofgren Smith (NJ) istering military assistance and sales under against appropriations heretofore made Dicks Lowey Spratt the heading ‘‘Foreign Military Financing under the authority of the Foreign Assist- Dingell Maloney Stark ance Act of 1961 for the same general purpose Stokes Program’’, not to exceed $2,000 shall be avail- Dixon Manton able for entertainment expenses and not to as any of the headings under title II of this Doggett Markey Studds Dooley Matsui Stupak exceed $50,000 shall be available for represen- Act are, if deobligated, hereby continued Durbin McCarthy Thompson tation allowances: Provided further, That of available for the same period as the respec- Ehlers McDermott Torres the funds made available by this Act under tive appropriations under such headings or Engel McHale Towns the heading ‘‘International Military Edu- until September 30, 1996, whichever is later, Eshoo McKinney Tucker cation and Training’’, not to exceed $50,000 and for the same general purpose, and for Evans McNulty Velazquez shall be available for entertainment allow- countries within the same region as origi- Vento Farr Meek ances: Provided further, That of the funds nally obligated: Provided, That the Appro- Fattah Mfume Waters Fazio Miller (CA) Watt (NC) made available by this Act for the Inter- priations Committees of both Houses of the Fields (LA) Mineta Waxman American Foundation, not to exceed $2,000 Congress are notified fifteen days in advance Filner Mink Weldon (PA) shall be available for entertainment and rep- of the deobligation and reobligation of such Flake Moran Wilson resentation allowances: Provided further, funds in accordance with regular notification Foglietta Morella Woolsey That of the funds made available by this Act procedures of the Committees on Appropria- Frank (MA) Nadler Wyden for the Peace Corps, not to exceed a total of tions. Frelinghuysen Oberstar Wynn $4,000 shall be available for entertainment AVAILABILITY OF FUNDS NOT VOTING—15 expenses: Provided further, That of the funds SEC. 511. No part of any appropriation con- Armey Ford Reynolds made available by this Act under the head- Bachus Furse Torricelli ing ‘‘Trade and Development Agency’’, not tained in this Act shall remain available for Bryant (TX) Gephardt Williams to exceed $2,000 shall be available for rep- obligation after the expiration of the current Camp Gunderson Yates resentation and entertainment allowances. fiscal year unless expressly so provided in Forbes Moakley Zimmer this Act: Provided, That funds appropriated PROHIBITION ON FINANCING NUCLEAR GOODS for the purposes of chapters 1, 8 and 11 of b 2112 SEC. 506. None of the funds appropriated or part I, section 667, and chapter 4 of part II of Mrs. MEYERS of Kansas, Mr. PE- made available (other than funds for ‘‘Inter- the Foreign Assistance Act of 1961, as national Organizations and Programs’’) pur- TERSON of Minnesota, and Mr. amended, and funds provided under the head- suant to this Act, for carrying out the For- ing ‘‘Assistance for Eastern Europe and the BARCIA changed their vote from ‘‘no’’ eign Assistance Act of 1961, may be used, ex- to ‘‘aye.’’ Baltic States’’, shall remain available until cept for purposes of nuclear safety, to fi- expended if such funds are initially obligated So the amendment, as amended, was nance the export of nuclear equipment, fuel, before the expiration of their respective peri- agreed to. or technology. ods of availability contained in this Act: Pro- The result of the vote was announced PROHIBITION AGAINST DIRECT FUNDING FOR vided further, That, notwithstanding any as above recorded. CERTAIN COUNTRIES other provision of this Act, any funds made The CHAIRMAN. Are there further SEC. 507. None of the funds appropriated or available for the purposes of chapter 1 of amendments to title IV? otherwise made available pursuant to this part I and chapter 4 of part II of the Foreign If not, the Clerk will designate title Act shall be obligated or expended to finance Assistance Act of 1961 which are allocated or V. directly any assistance or reparations to obligated for cash disbursements in order to The text of title V is as follows: Cuba, Iraq, Libya, North Korea, Iran, Serbia, address balance of payments or economic Sudan, or Syria: Provided, That for purposes policy reform objectives, shall remain avail- TITLE V—GENERAL PROVISIONS of this section, the prohibition on obliga- able until expended: Provided further, That OBLIGATIONS DURING LAST MONTH OF tions or expenditures shall include direct the report required by section 653(a) of the AVAILABILITY loans, credits, insurance and guarantees of Foreign Assistance Act of 1961 shall des- SEC. 501. Except for the appropriations en- the Export-Import Bank or its agents: Pro- ignate for each country, to the extent known titled ‘‘International Disaster Assistance’’, vided further, That, notwithstanding any at the time of submission of such report, and ‘‘United States Emergency Refugee and other provision of law, Azerbaijan shall be those funds allocated for cash disbursement Migration Assistance Fund’’, not more than eligible to receive funds provided under title for balance of payment and economic policy 15 per centum of any appropriation item II of this Act to be used solely for humani- reform purposes. H 6372 CONGRESSIONAL RECORD — HOUSE June 27, 1995

LIMITATION ON ASSISTANCE TO COUNTRIES IN producers of the same, similar, or competing United States proportionate share, in ac- DEFAULT commodity. cordance with section 307(c) of the Foreign SEC. 512. No part of any appropriation con- NOTIFICATION REQUIREMENTS Assistance Act of 1961, for any programs tained in this Act shall be used to furnish as- SEC. 515. For the purposes of providing the identified in section 307, or for Libya, Iran, sistance to any country which is in default Executive Branch with the necessary admin- or, at the discretion of the President, Com- during a period in excess of one calendar istrative flexibility, none of the funds made munist countries listed in section 620(f) of year in payment to the United States of available under this Act for ‘‘Child Survival the Foreign Assistance Act of 1961, as principal or interest on any loan made to and Disease Programs Fund’’, ‘‘Development amended: Provided, That, subject to the regu- such country by the United States pursuant Assistance Fund’’, ‘‘Development Fund for lar notification procedures of the Commit- to a program for which funds are appro- Africa’’, ‘‘International organizations and tees on Appropriations, funds appropriated priated under this Act: Provided, That this programs’’, ‘‘Trade and Development Agen- under this Act or any previously enacted Act section and section 620(q) of the Foreign As- cy’’, ‘‘International narcotics control’’, ‘‘As- making appropriations for foreign oper- sistance Act of 1961 shall not apply to funds sistance for Eastern Europe and the Baltic ations, export financing, and related pro- made available in this Act or during the cur- States’’, ‘‘Assistance for the New Independ- grams, which are returned or not made avail- rent fiscal year for Nicaragua, and for any ent States of the Former Soviet Union’’, able for organizations and programs because narcotics-related assistance for Colombia, ‘‘Economic Support Fund’’, ‘‘Peacekeeping of the implementation of this section or any Bolivia, and Peru authorized by the Foreign operations’’, ‘‘Operating expenses of the similar provision of law, shall remain avail- Assistance Act of 1961 or the Arms Export Agency for International Development’’, able for obligation through September 30, Control Act. ‘‘Operating expenses of the Agency for Inter- 1997. national Development Office of Inspector COMMERCE AND TRADE ECONOMIC SUPPORT FUND ASSISTANCE FOR General’’, ‘‘Nonproliferation and Disar- ISRAEL SEC. 513. (a) None of the funds appropriated mament Fund’’, ‘‘Anti-terrorism assist- SEC. 517. The Congress finds that progress or made available pursuant to this Act for ance’’, ‘‘Foreign Military Financing Pro- on the peace process in the Middle East is vi- direct assistance and none of the funds oth- gram’’, ‘‘International military education tally important to United States security in- erwise made available pursuant to this Act and training’’, ‘‘Inter-American Founda- terests in the region. The Congress recog- to the Export-Import Bank and the Overseas tion’’, ‘‘African Development Foundation’’, nizes that, in fulfilling its obligations under Private Investment Corporation shall be ob- ‘‘Peace Corps’’, ‘‘Migration and refugee as- the Treaty of Peace Between the Arab Re- ligated or expended to finance any loan, any sistance’’, or ‘‘United States Emergency Ref- public of Egypt and the State of Israel, done assistance or any other financial commit- ugee and Migration Assistance Fund’’, shall at Washington on March 26, 1979, Israel in- ments for establishing or expanding produc- be available for obligation for activities, pro- curred severe economic burdens. Further- tion of any commodity for export by any grams, projects, type of materiel assistance, more, the Congress recognizes that an eco- country other than the United States, if the countries, or other operations not justified nomically and militarily secure Israel serves commodity is likely to be in surplus on or in excess of the amount justified to the the security interests of the United States, world markets at the time the resulting pro- Appropriations Committees for obligation for a secure Israel is an Israel which has the ductive capacity is expected to become oper- under any of these specific headings unless incentive and confidence to continue pursu- ative and if the assistance will cause sub- the Appropriations Committees of both ing the peace process. Therefore, the Con- stantial injury to United States producers of Houses of Congress are previously notified gress declares that, subject to the availabil- the same, similar, or competing commodity: fifteen days in advance: Provided, That the ity of appropriations, it is the policy and the Provided, That such prohibition shall not President shall not enter into any commit- intention of the United States that the funds apply to the Export-Import Bank if in the ment of funds appropriated for the purposes provided in annual appropriations for the judgment of its Board of Directors the bene- of section 23 of the Arms Export Control Act Economic Support Fund which are allocated fits to industry and employment in the Unit- for the provision of major defense equip- to Israel shall not be less than the annual ed States are likely to outweigh the injury ment, other than conventional ammunition, debt repayment (interest and principal) from to United States producers of the same, simi- or other major defense items defined to be Israel to the United States Government in lar, or competing commodity. aircraft, ships, missiles, or combat vehicles, recognition that such a principle serves (b) None of the funds appropriated by this not previously justified to Congress or 20 per United States interests in the region. or any other Act to carry out chapter 1 of centum in excess of the quantities justified PROHIBITION CONCERNING ABORTIONS AND part I of the Foreign Assistance Act of 1961 to Congress unless the Committees on Ap- INVOLUNTARY STERILIZATION shall be available for any testing or breeding propriations are notified fifteen days in ad- SEC. 518. None of the funds made available feasibility study, variety improvement or in- vance of such commitment: Provided further, to carry out part I of the Foreign Assistance troduction, consultancy, publication, con- That this section shall not apply to any Act of 1961, as amended, may be used to pay ference, or training in connection with the reprogramming for an activity, program, or for the performance of abortions as a method growth or production in a foreign country of project under chapter 1 of part I of the For- of family planning or to motivate or coerce an agricultural commodity for export which eign Assistance Act of 1961 of less than 20 per any person to practice abortions. None of the would compete with a similar commodity centum of the amount previously justified to funds made available to carry out part I of grown or produced in the United States: Pro- the Congress for obligation for such activity, the Foreign Assistance Act of 1961, as vided, That this subsection shall not pro- program, or project for the current fiscal amended, may be used to pay for the per- hibit— year: Provided further, That the requirements formance of involuntary sterilization as a (1) activities designed to increase food se- of this section or any similar provision of method of family planning or to coerce or curity in developing countries where such this Act or any prior Act requiring notifica- provide any financial incentive to any person activities will not have a significant impact tion in accordance with the regular notifica- to undergo sterilizations. None of the funds in the export of agricultural commodities of tion procedures of the Committees on Appro- made available to carry out part I of the the United States; or priations may be waived if failure to do so Foreign Assistance Act of 1961, as amended, (2) research activities intended primarily would pose a substantial risk to human may be used to pay for any biomedical re- to benefit American producers. health or welfare: Provided further, That in search which relates in whole or in part, to SURPLUS COMMODITIES case of any such waiver, notification to the methods of, or the performance of, abortions Congress, or the appropriate congressional SEC. 514. The Secretary of the Treasury or involuntary sterilization as a means of committees, shall be provided as early as shall instruct the United States Executive family planning. None of the funds made practicable, but in no event later than three Directors of the International Bank for Re- available to carry out part I of the Foreign days after taking the action to which such construction and Development, the Inter- Assistance Act of 1961, as amended, may be notification requirement was applicable, in national Development Association, the obligated or expended for any country or or- the context of the circumstances necessitat- International Finance Corporation, the ganization if the President certifies that the ing such waiver: Provided further, That any Inter-American Development Bank, the use of these funds by any such country or or- notification provided pursuant to such a International Monetary Fund, the Asian De- ganization would violate any of the above waiver shall contain an explanation of the velopment Bank, the Inter-American Invest- provisions related to abortions and involun- emergency circumstances. ment Corporation, the North American De- tary sterilizations. velopment Bank, the European Bank for Re- Drawdowns made pursuant to section construction and Development, the African 506(a)(2) of the Foreign Assistance Act of 1961 REPORTING REQUIREMENT Development Bank, and the African Develop- shall be subject to the regular notification SEC. 519. The President shall submit to the ment Fund to use the voice and vote of the procedures of the Committees on Appropria- Committees on Appropriations the reports United States to oppose any assistance by tions. required by section 25(a)(1) of the Arms Ex- these institutions, using funds appropriated LIMITATION ON AVAILABILITY OF FUNDS FOR port Control Act. or made available pursuant to this Act, for INTERNATIONAL ORGANIZATIONS AND PROGRAMS SPECIAL NOTIFICATION REQUIREMENTS the production or extraction of any commod- SEC. 516. Notwithstanding any other provi- SEC. 520. None of the funds appropriated in ity or mineral for export, if it is in surplus sion of law or of this Act, none of the funds this Act shall be obligated or expended for on world markets and if the assistance will provided for ‘‘International Organizations Colombia, Dominican Republic, Guatemala, cause substantial injury to United States and Programs’’ shall be available for the Haiti, Indonesia, Liberia, Nicaragua, Peru, June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6373 Russia, Sudan, or Zaire except as provided tions as are other committees pursuant to ganization which is a grantee or contractor through the regular notification procedures subsection (c) of that section: Provided, That of the Agency for International Development of the Committees on Appropriations: Pro- before issuing a letter of offer to sell excess may place in interest bearing accounts funds vided, That this section shall not apply to defense articles under the Arms Export Con- made available under this Act or prior Acts funds appropriated by this Act to carry out trol Act, the Department of Defense shall no- or local currencies which accrue to that or- the provisions of chapter 1 of part I of the tify the Committees on Appropriations in ac- ganization as a result of economic assistance Foreign Assistance Act of 1961 that are made cordance with the regular notification proce- provided under title II of this Act and any available for Indonesia and Nicaragua. dures of such Committees: Provided further, interest earned on such investment may be DEFINITION OF PROGRAM, PROJECT, AND That such Committees shall also be informed used for the purpose for which the assistance ACTIVITY of the original acquisition cost of such de- was provided to that organization. fense articles. SEC. 521. For the purpose of this Act, ‘‘pro- LOCATION OF STOCKPILES gram, project, and activity’’ shall be defined AUTHORIZATION REQUIREMENT SEC. 531. Section 514(b)(2) of the Foreign at the Appropriations Act account level and SEC. 526. Funds appropriated by this Act Assistance Act of 1961 is amended by striking shall include all Appropriations and Author- may be obligated and expended subject to out ‘‘a total of $200,000,000 for stockpiles in izations Acts earmarks, ceilings, and limita- section 10 of Public Law 91–672 and section 15 Israel for fiscal years 1994 and 1995, up to tions with the exception that for the follow- of the State Department Basic Authorities $40,000,000 may be made available for stock- ing accounts: Economic Support Fund and Act of 1956. piles in the Republic of Korea, and up to Foreign Military Financing Program, ‘‘pro- OPPOSITION TO ASSISTANCE TO TERRORIST $10,000,000 may be made available for stock- piles in Thailand for fiscal year 1995.’’ and in- gram, project, and activity’’ shall also be COUNTRIES BY INTERNATIONAL FINANCIAL IN- considered to include country, regional, and STITUTIONS serting in lieu thereof ‘‘$40,000,000 for stock- central program level funding within each piles in the Republic of Korea and $10,000,000 SEC. 527. (a) INSTRUCTIONS FOR UNITED such account; for the development assistance for stockpiles in Thailand for fiscal year STATES EXECUTIVE DIRECTORS.—The Sec- accounts of the Agency for International De- 1996’’. retary of the Treasury shall instruct the velopment ‘‘program, project, and activity’’ SEPARATE ACCOUNTS United States Executive Director of each shall also be considered to include central international financial institution des- SEC. 532. (a) SEPARATE ACCOUNTS FOR program level funding, either as (1) justified ignated in subsection (b), and the Adminis- LOCAL CURRENCIES.—(1) If assistance is fur- to the Congress, or (2) allocated by the exec- trator of the Agency for International Devel- nished to the government of a foreign coun- utive branch in accordance with a report, to opment shall instruct the United States Ex- try under chapters 1 and 10 of part I or chap- be provided to the Committees on Appropria- ecutive Director of the International Fund ter 4 of part II of the Foreign Assistance Act tions within thirty days of enactment of this for Agriculture Development, to use the of 1961 under agreements which result in the Act, as required by section 653(a) of the For- voice and vote of the United States to oppose generation of local currencies of that coun- eign Assistance Act of 1961. any loan or other use of the funds of the re- try, the Administrator of the Agency for CHILD SURVIVAL AND AIDS ACTIVITIES spective institution to or for a country for International Development shall— SEC. 522. Up to $8,000,000 of the funds made which the Secretary of State has made a de- (A) require that local currencies be depos- available by this Act for assistance for fam- termination under section 6(j) of the Export ited in a separate account established by ily planning, health, child survival, and Administration Act of 1979. that government; AIDS, may be used to reimburse United (b) DEFINITION.—For purposes of this sec- (B) enter into an agreement with that gov- States Government agencies, agencies of tion, the term ‘‘international financial insti- ernment which sets forth— State governments, institutions of higher tution’’ includes— (i) the amount of the local currencies to be learning, and private and voluntary organi- (1) the International Bank for Reconstruc- generated, and zations for the full cost of individuals (in- tion and Development, the International De- (ii) the terms and conditions under which cluding for the personal services of such indi- velopment Association, and the Inter- the currencies so deposited may be utilized, viduals) detailed or assigned to, or con- national Monetary Fund; and consistent with this section; and tracted by, as the case may be, the Agency (2) wherever applicable, the Inter-Amer- (C) establish by agreement with that gov- for International Development for the pur- ican Development Bank, the Asian Develop- ernment the responsibilities of the Agency pose of carrying out family planning activi- ment Bank, the African Development Bank, for International Development and that gov- ties, child survival activities and activities the African Development Fund, and the Eu- ernment to monitor and account for deposits relating to research on, and the treatment ropean Bank for Reconstruction and Devel- into and disbursements from the separate ac- and control of, acquired immune deficiency opment. count. (2) USES OF LOCAL CURRENCIES.—As may be syndrome in developing countries: Provided, COMMERCIAL LEASING OF DEFENSE ARTICLES That funds appropriated by this Act that are agreed upon with the foreign government, SEC. 528. Notwithstanding any other provi- local currencies deposited in a separate ac- made available for child survival activities sion of law, and subject to the regular notifi- or activities relating to research on, and the count pursuant to subsection (a), or an cation requirements of the Committees on equivalent amount of local currencies, shall treatment and control of, acquired immune Appropriations, the authority of section deficiency syndrome may be made available be used only— 23(a) of the Arms Export Control Act may be (A) to carry out chapters 1 or 10 of part I notwithstanding any provision of law that used to provide financing to Israel and Egypt restricts assistance to foreign countries: Pro- or chapter 4 of part II (as the case may be), and NATO and major non-NATO allies for for such purposes as— vided further, That funds appropriated by this the procurement by leasing (including leas- Act that are made available for family plan- (i) project and sector assistance activities, ing with an option to purchase) of defense ar- or ning activities may be made available not- ticles from United States commercial suppli- withstanding section 512 of this Act and sec- (ii) debt and deficit financing; or ers, not including Major Defense Equipment (B) for the administrative requirements of tion 620(q) of the Foreign Assistance Act of (other than helicopters and other types of 1961. the United States Government. aircraft having possible civilian application), (3) PROGRAMMING ACCOUNTABILITY.—The PROHIBITION AGAINST INDIRECT FUNDING TO if the President determines that there are Agency for International Development shall CERTAIN COUNTRIES compelling foreign policy or national secu- take all appropriate steps to ensure that the SEC. 523. None of the funds appropriated or rity reasons for those defense articles being equivalent of the local currencies disbursed otherwise made available pursuant to this provided by commercial lease rather than by pursuant to subsection (a)(2)(A) from the Act shall be obligated to finance indirectly government-to-government sale under such separate account established pursuant to any assistance or reparations to Cuba, Iraq, Act. subsection (a)(1) are used for the purposes Libya, Iran, Syria, North Korea, or the Peo- STINGERS IN THE PERSIAN GULF REGION agreed upon pursuant to subsection (a)(2). ple’s Republic of China, unless the President (4) TERMINATION OF ASSISTANCE PRO- SEC. 529. Except as provided in section 581 of the United States certifies that the with- of the Foreign Operations, Export Financing, GRAMS.—Upon termination of assistance to a holding of these funds is contrary to the na- and Related Programs Appropriations Act, country under chapters 1 or 10 of part I or tional interest of the United States. 1990, the United States may not sell or other- chapter 4 of part II (as the case may be), any RECIPROCAL LEASING wise make available any Stingers to any unencumbered balances of funds which re- main in a separate account established pur- SEC. 524. Section 61(a) of the Arms Export country bordering the Persian Gulf under suant to subsection (a) shall be disposed of Control Act is amended by striking out the Arms Export Control Act or chapter 2 of for such purposes as may be agreed to by the ‘‘1995’’ and inserting in lieu thereof ‘‘1996’’. part II of the Foreign Assistance Act of 1961. government of that country and the United NOTIFICATION ON EXCESS DEFENSE EQUIPMENT DEBT-FOR-DEVELOPMENT States Government. SEC. 525. Prior to providing excess Depart- SEC. 530. In order to enhance the continued (5) CONFORMING AMENDMENTS.—The provi- ment of Defense articles in accordance with participation of nongovernmental organiza- sions of this subsection shall supersede the section 516(a) of the Foreign Assistance Act tions in economic assistance activities under tenth and eleventh provisos contained under of 1961, the Department of Defense shall no- the Foreign Assistance Act of 1961, including the heading ‘‘Sub-Saharan Africa, Develop- tify the Committees on Appropriations to endowments, debt-for-development and debt- ment Assistance’’ as included in the Foreign the same extent and under the same condi- for-nature exchanges, a nongovernmental or- Operations, Export Financing, and Related H 6374 CONGRESSIONAL RECORD — HOUSE June 27, 1995

Programs Appropriations Act, 1989 and sec- (2) such assistance will directly benefit the AUTHORITIES FOR THE PEACE CORPS, THE tions 531(d) and 609 of the Foreign Assistance needy people in that country; or INTER-AMERICAN FOUNDATION AND THE AFRI- Act of 1961. (3) the assistance to be provided will be hu- CAN DEVELOPMENT FOUNDATION (b) SEPARATE ACCOUNTS FOR CASH TRANS- manitarian assistance for foreign nationals SEC. 538. Unless expressly provided to the FERS.—(1) If assistance is made available to who have fled Iraq and Kuwait. contrary, provisions of this or any other Act, the government of a foreign country, under (b) IMPORT SANCTIONS.—If the President including provisions contained in prior Acts chapters 1 or 10 of part I or chapter 4 of part considers that the taking of such action authorizing or making appropriations for II of the Foreign Assistance Act of 1961, as would promote the effectiveness of the eco- foreign operations, export financing, and re- cash transfer assistance or as nonproject sec- nomic sanctions of the United Nations and lated programs, shall not be construed to tor assistance, that country shall be required the United States imposed with respect to prohibit activities authorized by or con- to maintain such funds in a separate account Iraq, Serbia, or Montenegro, as the case may ducted under the Peace Corps Act, the Inter- and not commingle them with any other be and is consistent with the national inter- American Foundation Act, or the African funds. est, the President may prohibit, for such a Development Foundation Act. The appro- (2) APPLICABILITY OF OTHER PROVISIONS OF period of time as he considers appropriate, priate agency shall promptly report to the LAW.—Such funds may be obligated and ex- the importation into the United States of Committees on Appropriations whenever it pended notwithstanding provisions of law any or all products of any foreign country is conducting activities or is proposing to which are inconsistent with the nature of that has not prohibited— conduct activities in a country for which as- this assistance including provisions which (1) the importation of products of Iraq, sistance is prohibited. are referenced in the Joint Explanatory Serbia, or Montenegro into its customs terri- Statement of the Committee of Conference IMPACT ON JOBS IN THE UNITED STATES tory, and accompanying House Joint Resolution 648 SEC. 539. None of the funds appropriated by (2) the export of its products to Iraq, Ser- (H. Report No. 98–1159). this Act may be obligated or expended to bia, or Montenegro, as the case may be. (3) NOTIFICATION.—At least fifteen days provide— prior to obligating any such cash transfer or POW/MIA MILITARY DRAWDOWN (a) any financial incentive to a business nonproject sector assistance, the President enterprise currently located in the United shall submit a notification through the regu- SEC. 535. (a) Notwithstanding any other States for the purpose of inducing such an lar notification procedures of the Commit- provision of law, the President may direct enterprise to relocate outside the United tees on Appropriations, which shall include a the drawdown, without reimbursement by States if such incentive or inducement is detailed description of how the funds pro- the recipient, of defense articles from the likely to reduce the number of employees of posed to be made available will be used, with stocks of the Department of Defense, defense such business enterprise in the United States a discussion of the United States interests services of the Department of Defense, and because United States production is being re- that will be served by the assistance (includ- military education and training, of an aggre- placed by such enterprise outside the United ing, as appropriate, a description of the eco- gate value not to exceed $15,000,000 in fiscal States; nomic policy reforms that will be promoted year 1996, as may be necessary to carry out (b) assistance for the purpose of establish- by such assistance). subsection (b). ing or developing in a foreign country any (4) EXEMPTION.—Nonproject sector assist- (b) Such defense articles, services and export processing zone or designated area in ance funds may be exempt from the require- training may be provided to Vietnam, Cam- which the tax, tariff, labor, environment, ments of subsection (b)(1) only through the bodia and Laos, under subsection (a) as the and safety laws of that country do not apply, notification procedures of the Committees President determines are necessary to sup- in part or in whole, to activities carried out on Appropriations. port efforts to locate and repatriate mem- within that zone or area, unless the Presi- COMPENSATION FOR UNITED STATES EXECUTIVE bers of the United States Armed Forces and dent determines and certifies that such as- DIRECTORS TO INTERNATIONAL FINANCIAL IN- civilians employed directly or indirectly by sistance is not likely to cause a loss of jobs STITUTIONS the United States Government who remain within the United States; or SEC. 533. (a) No funds appropriated by this unaccounted for from the Vietnam War, and (c) assistance for any project or activity Act may be made as payment to any inter- to ensure the safety of United States Gov- that contributes to the violation of inter- national financial institution while the Unit- ernment personnel engaged in such coopera- nationally recognized workers rights, as de- ed States Executive Director to such institu- tive efforts and to support United States De- fined in section 502(a)(4) of the Trade Act of tion is compensated by the institution at a partment of Defense-sponsored humanitarian 1974, of workers in the recipient country, in- rate which, together with whatever com- projects associated with the POW/MIA ef- cluding any designated zone or area in that pensation such Director receives from the forts. Any aircraft shall be provided under country: Provided, That in recognition that United States, is in excess of the rate pro- this section only to Laos and only on a lease the application of this subsection should be vided for an individual occupying a position or loan basis, but may be provided at no cost commensurate with the level of development at level IV of the Executive Schedule under notwithstanding section 61 of the Arms Ex- of the recipient country and sector, the pro- section 5315 of title 5, United States Code, or port Control Act and may be maintained visions of this subsection shall not preclude while any alternate United States Director with defense articles, services and training assistance for the informal sector in such to such institution is compensated by the in- provided under this section. country, micro and small-scale enterprise, stitution at a rate in excess of the rate pro- (c) The President shall, within sixty days and smallholder agriculture. vided for an individual occupying a position of the end of any fiscal year in which the au- AUTHORITY TO ASSIST BOSNIA-HERCEGOVINA at level V of the Executive Schedule under thority of subsection (a) is exercised, submit SEC. 540. (a) Congress finds as follows: section 5316 of title 5, United States Code. a report to the Congress which identifies the (1) The United Nations has imposed an em- (b) For purposes of this section, ‘‘inter- articles, services, and training drawn down bargo on the transfer of arms to any country national financial institutions’’ are: the under this section. on the territory of the former Yugoslavia. International Bank for Reconstruction and MEDITERRANEAN EXCESS DEFENSE ARTICLES (2) The federated states of Serbia and Development, the Inter-American Develop- Montenegro have a large supply of military ment Bank, the Asian Development Bank, SEC. 536. During fiscal year 1996, the provi- equipment and ammunition and the Serbian the Asian Development Fund, the African sions of section 573(e) of the Foreign Oper- forces fighting the government of Bosnia- Development Bank, the African Develop- ations, Export Financing, and Related Pro- Hercegovina have more than one thousand ment Fund, the International Monetary grams Appropriations Act, 1990, shall be ap- battle tanks, armored vehicles, and artillery Fund, the North American Development plicable, for the period specified therein, to pieces. Bank, and the European Bank for Recon- excess defense articles made available under (3) Because the United Nations arms em- struction and Development. sections 516 and 519 of the Foreign Assistance bargo is serving to sustain the military ad- COMPLIANCE WITH UNITED NATIONS SANCTIONS Act of 1961. vantage of the aggressor, the United Nations AGAINST IRAQ should exempt the government of Bosnia- CASH FLOW FINANCING SEC. 534. (a) DENIAL OF ASSISTANCE.—None Hercegovina from its embargo. of the funds appropriated or otherwise made SEC. 537. For each country that has been (b) Pursuant to a lifting of the United Na- available pursuant to this Act to carry out approved for cash flow financing (as defined tions arms embargo, or to a unilateral lifting the Foreign Assistance Act of 1961 (including in section 25(d) of the Arms Export Control of the arms embargo by the President of the title IV of chapter 2 of part I, relating to the Act, as added by section 112(b) of Public Law United States, against Bosnia-Hercegovina, Overseas Private Investment Corporation) or 99–83) under the Foreign Military Financing the President is authorized to transfer, sub- the Arms Export Control Act may be used to Program, any Letter of Offer and Acceptance ject to prior notification of the Committees provide assistance to any country that is not or other purchase agreement, or any amend- on Appropriations, to the government of in compliance with the United Nations Secu- ment thereto, for a procurement in excess of that nation, without reimbursement, defense rity Council sanctions against Iraq, Serbia $100,000,000 that is to be financed in whole or articles from the stocks of the Department or Montenegro unless the President deter- in part with funds made available under this of Defense and defense services of the De- mines and so certifies to the Congress that— Act shall be submitted through the regular partment of Defense of an aggregate value (1) such assistance is in the national inter- notification procedures to the Committees not to exceed $50,000,000 in fiscal year 1996: est of the United States; on Appropriations. Provided, That the President certifies in a June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6375 timely fashion to the Congress that the tiary boycotts of American firms that have authorities appropriated or otherwise made transfer of such articles would assist that commercial relations with Israel; and available by any subsequent Act unless such nation in self-defense and thereby promote (D) encourage the allies and trading part- Act specifically so directs. the security and stability of the region. ners of the United States to enact laws pro- EXCESS DEFENSE ARTICLES (c) Within 60 days of any transfer under the hibiting businesses from complying with the SEC. 546. (a) The authority of section 519 of authority provided in subsection (b), and boycott and penalizing businesses that do the Foreign Assistance Act of 1961, as every 60 days thereafter, the President shall comply. amended, may be used in fiscal year 1996 to report in writing to the Speaker of the House ANTI-NARCOTICS ACTIVITIES provide nonlethal excess defense articles to of Representatives and the President pro SEC. 543. (a) Of the funds appropriated or countries for which United States foreign as- tempore of the Senate concerning the arti- otherwise made available by this Act for sistance has been requested and for which re- cles transferred and the disposition thereof. (d) There are authorized to be appropriated ‘‘Economic Support Fund’’, assistance may ceipt of such articles was separately justified to the President such sums as may be nec- be provided to strengthen the administration for the fiscal year, without regard to the re- essary to reimburse the applicable appro- of justice in countries in Latin America and strictions in subsection (a) of section 519. priation, fund, or account for defense articles the Caribbean in accordance with the provi- (b) The authority of section 516 of the For- provided under this section. sions of section 534 of the Foreign Assistance eign Assistance Act of 1961, as amended, may Act of 1961, except that programs to enhance be used in fiscal year 1996 to provide defense SPECIAL AUTHORITIES protection of participants in judicial cases articles to Jordan, except that the provision SEC. 541. (a) Funds appropriated in title II may be conducted notwithstanding section of such defense articles shall be subject to of this Act that are made available for Haiti, 660 of that Act. section 534 of this Act. Afghanistan, Lebanon, and Cambodia, and (b) Funds made available pursuant to this PROHIBITION ON PUBLICITY OR PROPAGANDA for victims of war, displaced children, dis- section may be made available notwith- SEC. 547. No part of any appropriation con- placed Burmese, humanitarian assistance for standing the third sentence of section 534(e) tained in this Act shall be used for publicity Romania, and humanitarian assistance for of the Foreign Assistance Act of 1961. Funds or propaganda purposes within the United the peoples of Bosnia-Hercegovina, Croatia, made available pursuant to subsection (a) for States not authorized before the date of en- and Kosova, may be made available notwith- Bolivia, Colombia and Peru may be made actment of this Act by the Congress: Pro- standing any other provision of law: Pro- available notwithstanding section 534(c) and vided, That none of the funds appropriated by vided, That any such funds that are made the second sentence of section 534(e) of the this Act may be made available to carry out available for Cambodia shall be subject to Foreign Assistance Act of 1961. the provisions of section 531(e) of the Foreign the provisions of section 316 of Public Law ELIGIBILITY FOR ASSISTANCE Assistance Act of 1961 and section 906 of the 96–533. International Security and Development Co- SEC. 544. (a) ASSISTANCE THROUGH NON- USE OF AMERICAN RESOURCES GOVERNMENTAL ORGANIZATIONS.—Restric- operation Act of 1985: Provided further, That SEC. 548. To the maximum extent possible, tions contained in this or any other Act with the President shall terminate assistance to assistance provided under this Act should respect to assistance for a country shall not any country or organization that he deter- make full use of American resources, includ- be construed to restrict assistance in support mines is cooperating, tactically or strategi- ing commodities, products, and services. cally, with the Khmer Rouge in their mili- of programs of nongovernmental organiza- PROHIBITION OF PAYMENTS TO UNITED NATIONS tary operations. tions from funds appropriated by this Act to (b) Funds appropriated by this Act to carry carry out the provisions of chapters 1 and 10 MEMBERS out the provisions of sections 103 through 106 of part I of the Foreign Assistance Act of SEC. 549. None of the funds appropriated or of the Foreign Assistance Act of 1961 may be 1961: Provided, That the President shall take made available pursuant to this Act for car- used, notwithstanding any other provision of into consideration, in any case in which a re- rying out the Foreign Assistance Act of 1961, law, for the purpose of supporting tropical striction on assistance would be applicable may be used to pay in whole or in part any forestry and energy programs aimed at re- but for this subsection, whether assistance assessments, arrearages, or dues of any ducing emissions of greenhouse gases, and in support of programs of nongovernmental member of the United Nations. for the purpose of supporting biodiversity organizations is in the national interest of CONSULTING SERVICES the United States: Provided further, That be- conservation activities: Provided, That such SEC. 550. The expenditure of any appropria- fore using the authority of this subsection to assistance shall be subject to sections 116, tion under this Act for any consulting serv- furnish assistance in support of programs of 502B, and 620A of the Foreign Assistance Act ice through procurement contract, pursuant nongovernmental organizations, the Presi- of 1961. to section 3109 of title 5, United States Code, dent shall notify the Committees on Appro- (c) During fiscal year 1996, the President shall be limited to those contracts where priations under the regular notification pro- may use up to $40,000,000 under the authority such expenditures are a matter of public cedures of those committees, including a de- of section 451 of the Foreign Assistance Act record and available for public inspection, scription of the program to be assisted, the of 1961, notwithstanding the funding ceiling except where otherwise provided under exist- assistance to be provided, and the reasons for contained in subsection (a) of that section. ing law, or under existing Executive order furnishing such assistance: Provided further, (d) The Agency for International Develop- pursuant to existing law. ment may employ personal services contrac- That nothing in this subsection shall be con- tors, notwithstanding any other provision of strued to alter any existing statutory prohi- PRIVATE VOLUNTARY ORGANIZATIONS— law, for the purpose of administering pro- bitions against abortion or involuntary DOCUMENTATION grams for the West Bank and Gaza. sterilizations contained in this or any other SEC. 551. None of the funds appropriated or POLICY ON TERMINATING THE ARAB LEAGUE Act. made available pursuant to this Act shall be BOYCOTT OF ISRAEL (b) PUBLIC LAW 480.—During fiscal year available to a private voluntary organization 1996, restrictions contained in this or any which fails to provide upon timely request SEC. 542. It is the sense of the Congress any document, file, or record necessary to that— other Act with respect to assistance for a the auditing requirements of the Agency for (1) the Arab League countries should im- country shall not be construed to restrict as- International Development. mediately and publicly renounce the pri- sistance under the Agricultural Trade Devel- mary boycott of Israel and the secondary opment and Assistance Act of 1954: Provided, PROHIBITION ON ASSISTANCE TO FOREIGN GOV- and tertiary boycott of American firms that That none of the funds appropriated to carry ERNMENTS THAT EXPORT LETHAL MILITARY have commercial ties with Israel; and out title I of such Act and made available EQUIPMENT TO COUNTRIES SUPPORTING (2) the President should— pursuant to this subsection may be obligated INTERNATIONAL TERRORISM or expended except as provided through the (A) take more concrete steps to encourage SEC. 552. (a) None of the funds appropriated vigorously Arab League countries to re- regular notification procedures of the Com- or otherwise made available by this Act may nounce publicly the primary boycotts of Is- mittees on Appropriations. be available to any foreign government (c) EXCEPTION.—This section shall not rael and the secondary and tertiary boycotts which provides lethal military equipment to apply— of American firms that have commercial re- a country the government of which the Sec- (1) with respect to section 620A of the For- lations with Israel as a confidence-building retary of State has determined is a terrorist eign Assistance Act or any comparable pro- measure; government for purposes of section 40(d) of vision of law prohibiting assistance to coun- (B) take into consideration the participa- the Arms Export Control Act. The prohibi- tries that support international terrorism; tion of any recipient country in the primary tion under this section with respect to a for- or boycott of Israel and the secondary and ter- eign government shall terminate 12 months (2) with respect to section 116 of the For- tiary boycotts of American firms that have after that government ceases to provide such eign Assistance Act of 1961 or any com- commercial relations with Israel when deter- military equipment. This section applies parable provision of law prohibiting assist- mining whether to sell weapons to said coun- with respect to lethal military equipment ance to countries that violate internation- try; provided under a contract entered into after ally recognized human rights. (C) report to Congress on the specific steps the date of enactment of this Act. being taken by the President to bring about CEILINGS (b) Assistance restricted by subsection (a) a public renunciation of the Arab primary SEC. 545. Ceilings and earmarks contained or any other similar provision of law, may be boycott of Israel and the secondary and ter- in this Act shall not be applicable to funds or furnished if the President determines that H 6376 CONGRESSIONAL RECORD — HOUSE June 27, 1995

furnishing such assistance is important to graph (2) thereof: Provided, That the deter- PROHIBITION OF PAYMENT OF CERTAIN the national interests of the United States. mination required under this section shall be EXPENSES (c) Whenever the waiver of subsection (b) is in lieu of any determinations otherwise re- SEC. 561. None of the funds appropriated or exercised, the President shall submit to the quired under section 552(c): Provided further, otherwise made available by this Act under appropriate congressional committees a re- That 60 days after the date of enactment of the heading ‘‘INTERNATIONAL MILITARY EDU- port with respect to the furnishing of such this Act, and every 180 days thereafter, the CATION AND TRAINING’’ or ‘‘FOREIGN MILITARY assistance. Any such report shall include a Secretary of State shall submit a report to FINANCING PROGRAM’’ for Informational Pro- detailed explanation of the assistance to be the Committees on Appropriations describ- gram activities may be obligated or ex- provided, including the estimated dollar ing the steps the United States Government pended to pay for— amount of such assistance, and an expla- is taking to collect information regarding al- (1) alcoholic beverages; nation of how the assistance furthers United legations of genocide or other violations of (2) food (other than food provided at a mili- States national interests. international law in the former Yugoslavia tary installation) not provided in conjunc- WITHHOLDING OF ASSISTANCE FOR PARKING and to furnish that information to the Unit- tion with Informational Program trips where FINES OWED BY FOREIGN COUNTRIES ed Nations War Crimes Tribunal for the students do not stay at a military installa- SEC. 553. (a) IN GENERAL.—Of the funds former Yugoslavia. tion; or made available for a foreign country under NONLETHAL EXCESS DEFENSE ARTICLES (3) entertainment expenses for activities that are substantially of a recreational char- part I of the Foreign Assistance Act of 1961, SEC. 557. Notwithstanding section 519(f) of an amount equivalent to 110 percent of the the Foreign Assistance Act of 1961, during acter, including entrance fees at sporting total unpaid fully adjudicated parking fines fiscal year 1996, funds available to the De- events and amusement parks. and penalties owed to the District of Colum- partment of Defense may be expended for LIMITATION ON ASSISTANCE TO COUNTRIES THAT bia by such country as of the date of enact- crating, packing, handling and transpor- RESTRICT THE TRANSPORT OR DELIVERY OF ment of this Act shall be withheld from obli- tation of nonlethal excess defense articles UNITED STATES HUMANITARIAN ASSISTANCE gation for such country until the Secretary transferred under the authority of section SEC. 562. (a) IN GENERAL.—None of the of State certifies and reports in writing to 519 to countries eligible to participate in the funds made available in this Act may be used the appropriate congressional committees Partnership for Peace and to receive assist- for assistance in support of any country that such fines and penalties are fully paid ance under Public Law 101–179. when it is made known to the President that to the government of the District of Colum- LANDMINES the government of such country prohibits or bia. otherwise restricts, directly or indirectly, (b) DEFINITION.—For purposes of this sec- SEC. 558. Notwithstanding any other provi- the transport or delivery of United States tion, the term ‘‘appropriate congressional sion of law, demining equipment available to humanitarian assistance. committees’’ means the Committee on For- any department or agency and used in sup- (b) EXCEPTION.—Subsection (a) shall not eign Relations and the Committee on Appro- port of the clearing of landmines for humani- apply to assistance in support of any country priations of the Senate and the Committee tarian purposes may be disposed of on a when it is made known to the President that on International Relations and the Commit- grant basis in foreign countries, subject to the assistance is in the national security in- tee on Appropriations of the House of Rep- such terms and conditions as the President terest of the United States. resentatives. may prescribe. REFERENCES TO AUTHORIZATION ACTS LIMITATION ON ASSISTANCE FOR THE PLO FOR REPORT ON THE SALARIES AND BENEFITS OF THE SEC. 563. The funds appropriated under the THE WEST BANK AND GAZA IMF AND THE WORLD BANK heading, ‘‘Child Survival and Disease Pro- SEC. 554. None of the funds appropriated by SEC. 559. The Comptroller General shall grams Fund’’ are provided pursuant to the this Act may be obligated for assistance for submit a report to the Committees on Appro- Foreign Assistance Act, as amended: under the Palestine Liberation Organization for priations not later than November 1, 1995, on sections 103 through 106 (Development As- the West Bank and Gaza unless the President the following— sistance Fund), in the amount of $214,000,000; has exercised the authority under section (1) a review of the existing salaries and under part I, chapter 10 (Development Fund 583(a) of the Middle East Peace Facilitation benefits of employees of the International for Africa), in the amount of $131,000,000; Act of 1994 (part E of title V of Public Law Monetary Fund and the International Bank under the provisions of section 498(6) (Assist- 103–236) or any other legislation to suspend for Reconstruction and Development; and ance for the New Independent States of the or make inapplicable section 307 of the For- (2) a review of all benefits paid to depend- Former Soviet Union), in the amount of eign Assistance Act of 1961 and that suspen- ents of Fund and Bank employees. $15,000,000; under the provisions of part I, sion is still in effect: Provided, That if the Such report shall include a comparison of chapter 1, section 104(c) of the Foreign As- President fails to make the certification the salaries and benefits paid to employees sistance Act and the Support for East Euro- under section 583(b)(2) of the Middle East and dependents of the Fund and the Bank pean Democracy (SEED) Act of 1989, in the Peace Facilitation Act or to suspend the pro- with salaries and benefits paid to employees amount of $1,000,000; under provisions of hibition under other legislation, funds appro- holding comparable positions in the public chapter 4, part II (Economic Support Fund), priated by this Act may not be obligated for and private sectors in member countries and in the amount of $23,000,000; under the provi- assistance for the Palestine Liberation Orga- in the international sector. sions of section 301, in the amount of nization for the West Bank and Gaza. RESTRICTIONS CONCERNING THE PALESTINIAN $100,000,000 as a contribution on a grant basis EXPORT FINANCING TRANSFER AUTHORITIES AUTHORITY to the United Nation’s Children’s Fund (UNICEF): Provided, That funds derived from SEC. 555. Not to exceed 5 percent of any ap- SEC. 560. None of the funds appropriated by funds authorized under chapter 4, part II, propriation other than for administrative ex- this Act may be obligated or expended to shall be made available for projects meeting penses made available for fiscal year 1996 for create in any part of Jerusalem a new office criteria set forth in part I section 104(c): Pro- programs under title I of this Act may be of any department or agency of the United vided further, That funds appropriated under transferred between such appropriations for States Government for the purpose of con- the heading ‘‘Child Survival and Disease Pro- use for any of the purposes, programs and ac- ducting official United States Government grams Fund’’ shall be in addition to amounts tivities for which the funds in such receiving business with the Palestinian Authority over otherwise available for such purposes. account may be used, but no such appropria- Gaza and Jericho or any successor Palestin- tion, except as otherwise specifically pro- ian governing entity provided for in the Is- Mr. PORTER. Mr. Chairman, as I have said vided, shall be increased by more than 25 per- rael-PLO Declaration of Principles: Provided, many times on this floor, the United States cent by any such transfer: Provided, That the That this subsection shall not apply to the has a unique opportunityÐin fact in my view exercise of such authority shall be subject to acquisition of additional space for the exist- a responsibilityÐto remain engaged overseas the regular notification procedures of the ing Consulate General in Jerusalem: Provided Committees on Appropriations. in the post-cold-war world. The reasons for further, That meetings between officers and promoting our interest overseas, including the WAR CRIMES TRIBUNALS employees of the United States and officials SEC. 556. If the President determines that of the Palestinian Authority, or any succes- development of overseas markets for United doing so will contribute to a just resolution sor Palestinian governing entity provided for States goods, protection of the planet's envi- of charges regarding genocide or other viola- in the Israel-PLO Declaration of Principles, ronment, and United States strategic interests tions of international humanitarian law, the for the purpose of conducting official United did not disappear with the break-up of the So- authority of section 552(c) of the Foreign As- States Government business with such au- viet Union. If anything, the United States sistance Act of 1961, as amended, may be thority should continue to take place in lo- should focus its energies and resources on used to provide up to $25,000,000 of commod- cations other than Jerusalem. As has been these issues now, when we can have the ities and services to the United Nations War true in the past, officers and employees of greatest opportunity for success any time in Crimes Tribunal established with regard to the United States Government may continue the former Yugoslavia by the United Nations to meet in Jerusalem on other subjects with the last 50 years. Security Council or such other tribunals or Palestinians (including those who now oc- The gentleman from New York is a good commissions as the Council may establish to cupy positions in the Palestinian Authority), friend of mine and a person whom I greatly re- deal with such violations, without regard to have social contacts, and have incidental spect for his longtime dedication to enhancing the ceiling limitation contained in para- discussions. the United States's role in the world through June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6377 development aid. I commend him for his lead- The motion was agreed to. event and for any liability related to ership in passing the American Overseas In- Accordingly, the Committee rose; it. The association also agrees to make terests Act earlier this year. Unfortunately, he and the Speaker pro tempore (Mr. any necessary arrangements for the has been put in a very peculiar and difficult DIAZ-BALART) having assumed the races with the approval of the Archi- position by the foreign operations bill, which chair, Mr. HANSEN, Chairman of the tect of the Capitol and the Capitol Po- reflects his priorities, I believe, but exceeds his Committee of the Whole House on the lice Board. committee's authorization level by $24 million. State of the Union, reported that that For 50 years the Soap Box Derby While I understand the gentleman's dedica- Committee, having had under consider- races have taken place in Washington, tion to protecting the prerogatives of his com- ation the bill, (H.R. 1868) making ap- D.C., and this will be the fifth time mittee, I cannot support his amendment. The propriations for foreign operations, ex- that the Capitol Grounds will be used development assistance account is, in my port financing, and related programs for the races down Constitution Ave- view, the backbone of this bill. The bill already for the fiscal year ending September 30, nue. effectively cuts this account by 40 percent, 1996, and for other purposes, had come Every year this event helps teach devastating programs in the areas of popu- to no resolution thereon. participating youngsters the basics of lation, education, agriculture, microenterprise, f mechanics and aerodynamics as they and others that promote our interests over- design and build their race cars. It is seas. Further cuts like the ones proposed in REPORT ON RESOLUTION PROVID- truly an exciting event for the entire this amendment are counterproductive and ING FOR CONSIDERATION OF family. should not be enacted. HOUSE JOINT RESOLUTION 79, I urge my colleagues to support this I have a great deal of respect for the gen- PROPOSING CONSTITUTIONAL resolution so that this activity may tleman from New York, but I must reluctantly AMENDMENT TO PROHIBIT PHYS- take place. encourage Members to oppose his amend- ICAL DESECRATION OF THE Mr. WISE. Mr. Speaker, further re- ment today. FLAG serving the right to object, I yield to the gentleman from Maryland [Mr. Mr. GOODLING. Mr. Chairman, I rise today Mr. SOLOMON, from the Committee HOYER]. to comment on an issue of vital strategic im- on Rules, submitted a privileged report portance to the United StatesÐthe future of Mr. HOYER. Mr. Speaker, I thank (Rept. No. 104–164) on the resolution (H. the gentleman from West Virginia for Ukraine. Res. 173) providing for consideration of The Ukraine, situated in the middle of Sir yielding to me. the joint resolution (H.J. Res. 79) pro- Halford John Mackinder's celebrated ``heart- Mr. Speaker, I want to thank Chair- posing an amendment to the Constitu- land'' of the world, is of vital strategic signifi- man SHUSTER, the ranking Member, tion of the United States authorizing cance to every nation in the region. Standing the gentleman from California, Mr. MI- at the crossroads of Europe and Asia, the fu- the Congress and the States to prohibit NETA, my friend and colleague, the gen- ture of the Ukraine and its 52 million people the physical desecration of the flag of tleman from Maryland, WAYNE will have a profound impact on the geopolitical the United States, which was referred GILCHREST, and the gentleman from complexion of Europe, Central Asia, and the to the House Calendar and ordered to West Virginia, BOB WISE, for their Transcaucasus. be printed. strong support and continued assist- Recently, the Ukraine has responded ex- f ance in expediting consideration of this tremely well in its efforts to implement demo- bill today. AUTHORIZING USE OF CAPITOL cratic principles, begin the conversion to a free This resolution authorizes the use of GROUNDS FOR GREATER WASH- market economy, and fulfill international treaty Constitution Avenue between Delaware INGTON SOAP BOX DERBY commitments. In particular, the period since Avenue and Third Street for the 54th the 1994 democratic election of President Mr. GILCHREST. Mr. Speaker, I ask running of the Greater Washington Kuchma has been a time of significant unanimous consent to take from the Soap Box Derby on July 15, 1995. This progress in several respects. Speaker’s table the concurrent resolu- competition is part of the All-Amer- However, the United States commitment to tion (H. Con. Res. 38) authorizing the ican Soap Box Derby held later this the Ukraine has not been commensurate with use of the Capitol Grounds for the summer in Akron, OH. the pace of Ukrainian reform. I understand the Greater Washington Soap Box Derby, The resolution also authorizes the reluctance of the House Committee on Appro- and ask for its immediate consider- Architect of the Capitol and the Cap- priations Subcommittee on Foreign Operations ation in the House. itol Police to negotiate a licensing to provide specific country earmarks in this The Clerk read the title of the con- agreement with the Greater Washing- bill. However, this administration has been current resolution. ton Soap Box Derby Association to as- sure that there will be complete com- negligent in providing proportionate funding for b 2115 the Ukraine under the authority of the Free- pliance with rules and regulations gov- dom Support Act. Ukraine's size, geostrategic The SPEAKER pro tempore (Mr. erning use of the Capitol Grounds. significance, and commitment to important DIAZ-BALART). Is there objection to the For the past 4 years, I have proudly treaty obligations have not been reflected in request of the gentleman from Mary- sponsored this bill along with regional the administration's distribution of Freedom land? Members and sports fans. It provides Support Act funds. Mr. WISE. Mr. Speaker, reserving the young boys and girls, ages 9 to 16, with Ukraine has fulfilled nuclear disarmament right to object, I will not object, of an invaluable opportunity to develop obligations, adopted democratic reform, made course, but I yield to the gentleman and practice both sportsmanship and progress in economic reform, and boasts an from Maryland [Mr. GILCHREST] for an engineering skills. excellent human rights record. In many ways, explanation of his request. This year, over 50 participants from the Ukrainian record stands in stark contrast Mr. GILCHREST. Mr. Speaker, this Washington, DC and the surrounding to that of the Russian Government. resolution authorizes the Greater communities of northern Virginia and Russia is the overwhelming recipient of the Washington Soap Box Derby races to Maryland are expected to participate Freedom Support Act account. In response to be run on the Capitol Grounds on July in this year’s event. I am pleased that several regrettable actions undertaken by the 15, 1995, or on such other date as the boys and girls representing all five Russian Government, Congress has justifiably Speaker of the House and President pro counties in my district will be compet- reduced our commitment to that account. It is tempore of the Senate so designate. ing in this year’s derby. the expectation of Congress that these reduc- This free event is sponsored by the All The Soap Box Derby promotes a posi- tions will be borne by Russia and not the American Soap Box Derby and its local tive activity involving our young peo- Ukraine. affiliate, the Greater Washington Soap ple. All too often, we hear many dis- While I support the reductions in spending Box Derby Association. Its participants turbing stories about negative activi- for the Freedom Support Act, these cuts are young girls and boys from 9 to 16 ties youth are involved in. should not come from the Ukrainian allotment. years old who reside in the Greater I am reminded of a statement Ken Congress will be watching the administration Washington metropolitan area. Tomasello, the director of Greater closely on this matter. Pursuant to this resolution the asso- Washington Soap Box Derby Associa- Mr. CALLAHAN. Mr. Chairman, I ciation would assume full responsibil- tion, made to me 4 years ago when I in- move that the Committee do now rise. ity for any expenses involved with the troduced the first resolution for use of H 6378 CONGRESSIONAL RECORD — HOUSE June 27, 1995 the Capitol Grounds. He said, in short, Association shall assume full responsibility why leaders in Washington would cut ‘‘while the derby doesn’t keep kids off for all expenses and liabilities incident to all their senior health care plan in order the street, it does give them a drug free activities associated with the event. to finance a tax cut. Frankly, Mr. activity on the street.’’ SEC. 3. STRUCTURES AND EQUIPMENT. Speaker, I do not either. The young people involved spend For the purposes of this resolution, the As- I also had a chance to visit with some many months preparing for this race. sociation is authorized to erect upon the doctors who asked me not to cut Medi- Capitol grounds, subject to the approval of The day they actually compete pro- the Architect of the Capitol, such stage, care. These doctors were declared Re- vides them with a sense of achievement sound amplification devices, and other relat- publicans. They said, for the first time and comraderie, not only for them- ed structures and equipment as may be re- in 30 years, they have been able to ade- selves but also for their families and quired for the event to be carried out under quately provide health care for seniors friends. this resolution. through the Medicare program. We This worthwhile event provides the SEC. 4. ADDITIONAL ARRANGEMENTS. should cut fraud in Medicare by fund- participants, tourists, and local resi- The Architect of the Capitol and the Cap- ing Operation Restore Trust, to elimi- dents with a safe and enjoyable day of itol Police Board are authorized to make any nate fraud in health care, but we activities. I would like to take this op- such additional arrangements that may be should not arbitrarily cut Medicare to required to carry out the event under this portunity to congratulate them for resolution. finance our egregious tax cut plan. their achievements and wish them all The Republican budget agreement well in this year’s race. The concurrent resolution was agreed cuts Medicare, education, job training, Again, I want to thank the Transpor- to. and then cuts taxes. They want to cut A motion to reconsider was laid on tation Committee for its continued taxes and also cut Medicare at the the table. support of the Greater Washington same time. Then they say that are not Soap Box Derby and I encourage all of f cutting Medicare to finance their tax my colleagues to attend this year’s PERMISSION FOR SUNDRY COM- break. Something is fishy. race. MITTEES AND THEIR SUB- Mr. Speaker, Congress should work Mr. WISE. Mr. Speaker, further re- COMMITTEES TO SIT TOMORROW, hard to cut the waste, fraud, and abuse serving the right to object, I join my JUNE 28, 1995, DURING 5-MINUTE in Medicare. I hope we can agree that colleague Mr. GILCHREST in supporting RULE seniors should not be used to balance House Concurrent Resolution 38, a res- the budget for sound bites in Washing- olution to authorize the use of the Cap- Ms. ROS-LEHTINEN. Mr. Speaker, I ton. Let us be fair to the students and itol Grounds for the Greater Washing- ask unanimous consent that the fol- seniors and not punish them for a bal- ton Soap Box Derby. The event is lowing committees and their sub- anced budget. It’s not good govern- scheduled for July 15, 1995, and part of committees be permitted to sit tomor- ment. the Capitol Grounds as well as Con- row while the House is meeting in the Mr. Speaker, I submit for the RECORD stitution Ave. NE., will be used for the Committee of the Whole House under an article from the Houston Chronicle. race. the 5-minute rule: The Committee on CONGRESSMEN WARN SENIORS OF GOP BUDGET Boys and girls, ages 9 through 16, de- Agriculture; the Committee on Bank- CUTS sign, build and race their own soap box ing and Financial Services; the Com- (By Stefanie Asin) cars. In the process they become famil- mittee on Commerce; the Committee Democratic U.S. Reps. Dick Gephardt and iar with the principles of aerodynamics on Economic and Educational Opportu- Gene Green told about 100 senior citizens and mechanics. In addition, the entire nities; the Committee on Government Monday the Republicans want to balance the family can participate in, and enjoy Reform and Oversight; the Committee budget at their expense. the fun and activities of the day. on the Judiciary; the Committee on The GOP wants a $270 billion cut in Medi- The winner of the Washington race National Security; the Committee on care and Medicaid spending, and if the GOP’s Small Business; and the Permanent Se- budget agreement passes this week in the will then compete in the national com- House, seniors could expect $1,000 more a petition in Akron, OH. lect Committee on Intelligence. year in medical costs, said Gephardt, House This is a very worthwhile, well at- It is my understanding that the mi- minority leader from Missouri. tended activity. I wish to commend Mr. nority has been consulted and that ‘‘It is wrong to do this,’’ he said. ‘‘A lot of HOYER for his support for this annual there is no objection to these requests. you live on your Social Security. You’re al- event, and urge support for House Con- The SPEAKER pro tempore. Is there ready having trouble paying for rent, hous- current Resolution 38. objection to the request of the gentle- ing, groceries and prescription drugs.’’ Mr. Speaker, I withdraw my reserva- woman from Florida. Gephardt, who heard support from the sen- Mr. WISE. Mr. Speaker, reserving the iors as he spoke, encouraged them to speak tion of objection. out and fight the proposed cuts. Congress The SPEAKER pro tempore. Is there right to object, the gentlewoman is ab- should cut defense spending instead, he said. objection to the request of the gen- solutely correct. The Democrat minor- ‘‘I strongly object to the priorities that tleman from Maryland? ity leadership has been consulted. We have been set,’’ said Green of Houston. ‘‘You There was no objection. have no objection. can’t balance the budget on the backs of the The Clerk read the concurrent reso- Mr. Speaker, I withdraw my reserva- senior citizens.’’ lution, as follows: tions of objection. Green said 286,000 Harris County senior citizens receive more than $1.5 billion in H. CON. RES. 38 The SPEAKER pro tempore. Is there objection to the request of the gentle- Medicare payments annually and cannot af- Resolved by the House of Representatives (the ford to lose their health care. Senate concurring), woman from Florida? GOP leaders say Medicare spending must SECTION 1. AUTHORIZATION OF SOAP BOX There was no objection. be slowed before the system goes bankrupt. DERBY RACES ON CAPITOL f If Medicare payments continue at their cur- GROUNDS. rent rate—$4,700 to the average person per The Greater Washington Soap Box Derby CUT WASTE, FRAUD, AND ABUSE year—the fund will be bankrupt by 2002, said Association (hereinafter in this resolution IN MEDICARE Tom Hoopes, spokesman for Rep. Bill Ar- referred to as the ‘‘association’’) shall be per- (Mr. GENE GREEN of Texas asked cher, R-Houston, chairman of the House mitted to sponsor a public event, soap box Ways and Means Committee. derby races, on the Capitol grounds on July and was given permission to address ‘‘If we don’t slow the increase, these people 15, 1995, or on such other date as the Speaker the House for 1 minute and to revise will get absolutely nothing,’’ Hoopes said. of the House of Representatives and the and extend his remarks and include ex- ‘‘We think it’s foolhardy for political gain President pro tempore of the Senate may traneous material.) to spend too much now and end up with jointly designate. Mr. GENE GREEN of Texas. Mr. nothing after the next couple of elections. SEC. 2. CONDITIONS. Speaker, yesterday I met with 100 sen- We would tell the senior citizens we are The event to be carried out under this res- ior citizens from my district to talk truly concerned about Medicare and its fu- olution shall be free of admission charge to ture.’’ the public and arranged not to interfere with with them about the cuts they will be Susie Davis, 85, and several others asked the needs of Congress, under conditions to be facing under this new Republican budg- the congressmen many questions about how prescribed by the Architect of the Capitol et plan that came out of the conference the Democratic and Republican proposals and the Capitol Police Board; except that the committee. They do not understand would affect them. Davis, who lives alone June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6379 with no family left, said she needs subsidized offer the lawn of the White House for FARM PROGRAMS health care. the national 4th of July swearing-in The SPEAKER pro tempore. Under a ‘‘I don’t have anything else,’’ she said. ceremony and that every Member of ‘‘It’s bad to do us that way.’’ previous order of the House, the gen- this Congress will sponsor residents in tleman from Georgia [Mr. KINGSTON] is f their district of participate in such a recognized for 5 minutes. SPECIAL ORDERS swearing-in ceremony. Mr. KINGSTON. Mr. Speaker, I just wanted to speak briefly about one of The SPEAKER pro tempore. Under f the amendments we had today in the the Speaker’s announced policy of May The SPEAKER pro tempore. Under a full Committee on Appropriations that 12, 1995, and under a previous order of previous order of the House, the gen- had to do with some of the farm pro- the House, the following Members will tleman from Indiana [Mr. BURTON] is grams that are coming up. be recognized for 5 minutes each. recognized for 5 minutes This particular amendment had to do f [Mr. BURTON of Indiana addressed with the peanut program. The peanut the House. His remarks will appear NATURALIZATON REMARKS program, like all of the agriculture hereafter in the Extensions of Re- programs, frankly are somewhat hard The SPEAKER pro tempore. Under a marks.] to describe and explain and they are previous order of the House, the gen- f very complicated. But one of the things tleman from California, [Mr. FARR] is that I think people need to keep in recognized for 5 minutes. The SPEAKER pro tempore. Under a previous order of the House, the gentle- mind when we discuss agriculture is Mr. FARR. Mr. Speaker, as we ap- that, number one, the agriculture pro- proach the 4th of July celebrating our woman from Texas [Ms. JACKSON-LEE] is recognized for 5 minutes. grams that we have were designed to citizenship and the good fortune to live give the American consumers an abun- [Ms. JACKSON-LEE addressed the in a country where people can elect a dant supply of food and a steady sup- House. Her remarks will appear here- government that derives its strength ply, steady variety at reasonable after in the Extensions of Remarks.] from the faith of the government, Let prices. That has been achieved. Amer- us take this moment during the 4th of f ican consumers spend 11 percent of July recess to reflect on a lot of people The SPEAKER pro tempore. Under a their income on food compared to 20 who will be citizens of the United previous order of the House, the gen- percent in other countries and 33 per- States. tleman from Florida [Mr. FOLEY] is cent in countries like the Soviet Mr. Speaker, I am talking about the recognized for 5 minutes. Union. many of us who recognize that there [Mr. FOLEY addressed the House. His So when we talk about farm subsidies are decent, productive, legal immi- and farm programs and so forth, we grants trying to become good and pro- remarks will appear hereafter in the Extensions of Remarks.] need to keep in mind that the people ductive American citizens. Sometimes who are being subsidized are not nec- there is one thing in the way, a back- f essarily the farmers. They are the logged naturalization process. The SPEAKER pro tempore. Under a American consumers. Eleven percent of As a Member of this Congress, I have previous order of the House, the gen- our income, again, Mr. Speaker, goes worked with the administration to- tleman from Oregon [Mr. DEFAZIO] is to groceries. Compared to other coun- wards eliminating the long backlogs recognized for 5 minutes. tries, America is favorably ahead. and improving the naturalization proc- ess for many hard-working immigrants [Mr. DEFAZIO addressed the House. b 2130 His remarks will appear hereafter in who wait as long as a year and a half to Number two, farm programs have the Extensions of Remarks.] get naturalized after they have quali- been reduced from a $26 billion level in fied to be naturalized. f 1987 to $10.6 billion today, in 1995. If all Recently I supported the INS request The SPEAKER pro tempore. Under a the Federal Government programs had to pout more funds into improving our previous order of the House, the gen- been reduced as much as agriculture naturalization system. This successful tleman from Florida [Mr. GOSS] is rec- programs, we would not have the defi- effort allows the INS to spend $76.6 mil- ognized for 5 minutes. cit. We would be paying down the debt. lion to make progress, processing ‘‘ad- [Mr. GOSS addressed the House. His No other agencies, with the exception justment of status applications’’ and remarks will appear hereafter in the of Defense, can claim that kind of cut ‘‘naturalization applications’’ much Extensions of Remarks.] in the last 8-year period of time. easier. Yet, Mr. Speaker, every time I pick These critical funds will allow the f up the newspapers, the big problem INS to hire more than 1,000 much-need- The SPEAKER pro tempore. Under a with the Federal budget seems to be ed additional staff and utilize newly previous order of the House, the gentle- agriculture. People do not keep that in improved technology to more effi- woman from Ohio [Ms. KAPTUR] is rec- mind. ciently process the surging backlogs. ognized for 5 minutes. Finally, let me say this. The farm It will help also in the INS efforts to [Ms. KAPTUR addressed the House. bill is coming up. Every year we have a improve customer service. It is very Her remarks will appear hereafter in farm bill, and all these programs are up important to point out that the money the Extensions of Remarks.] for negotiation right now. There are for naturalization is not taxpayer many, many Members who are moving money. It is from the immigrants f these programs to a more traditional themselves and from the application The SPEAKER pro tempore. Under a capitalist system. We are changing the fees that they pay into the system. previous order of the House, the gen- status quo. We are moving towards no Mr. Speaker, I am pleased to see that tleman from California [Mr. RIGGS] is net cost programs. this unprecedented commitment by the recognized for 5 minutes. I have noticed that the gentleman INS to improve the naturalization [Mr. RIGGS addressed the House. His from central Georgia, SAXBY process and eliminate many of the remarks will appear hereafter in the CHAMBLISS, has come down here. He is backlogs will allow many people to be- Extensions of Remarks.] on the Committee on Agriculture. He is come citizens this next year. I ask my f involved. I am happy to yield to the colleagues to join me in making the gentleman from Georgia. I know he has 4th of July a day in which our commu- The SPEAKER pro tempore. Under a been involved in changing the peanut nities do their own swearing-in cere- previous order of the House, the gen- program to a no net cost program, and monies, to welcome our newest citizens tleman from Ohio [Mr. HOKE] is recog- I know he is doing the same with many on board. nized for 5 minutes. other programs. I will be performing such ceremonies [Mr. HOKE addressed the House. His Mr. CHAMBLISS. Mr. Speaker, I in Watsonville, CA, on July 7. I hope a remarks will appear hereafter in the thank the gentleman for yielding to year from now that the President will Extensions of Remarks.] me. H 6380 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Mr. Speaker, he is exactly right. We A NEW FARM POLICY this game. I am glad to say that most in the Committee on Agriculture have The SPEAKER pro tempore (Mr. of the farmers I have talked to, and I been involved in trying to rewrite DIAZ-BALART). Under a previous order think Mr. CHAMBLISS as well, are say- every single title of the agriculture of the House, the gentleman from Geor- ing ‘‘Do what you can to balance the programs in preparation for the 1995 gia [Mr. CHAMBLISS] is recognized for 5 budget. Make that the number one pri- farm bill, which is, without a doubt, minutes. ority, but remember, you have to feed going to be the most crucial farm bill Mr. CHAMBLISS. Mr. Speaker, we people and you have to have farmers to that we have ever written in Congress. will continue the same dialog with the do that, so do not eliminate all your The reason it is going to be so crucial gentleman from the First District of agricultural investments.’’ is that it is going to dictate how our Georgia [Mr. KINGSTON]. Mr. CHAMBLISS. One interesting agriculture community operates from Mr. Speaker, one way that we look at thing about agriculture, Mr. Speaker, now into the 21st century. the farm programs is not from the is that our farmers are generally con- Irrespective of what any segment of standpoint of is it a subsidy, because it servative individuals. They fully be- our country thinks, the agriculture really is not. The United States gov- lieve the main thing we need to do in community is still the backbone of the ernment makes an investment into our this country is balance the budget. I economy of this country. The reason agriculture community, and a good ex- have not met a single farmer in my dis- they are is that we feed more people in ample of it is with the peanut program. trict who does not give that a high pri- this country than anybody else in the The peanut program is a highly criti- ority. world does. We not only feed folks in cized program, but the reason it is At the same time, as the gentleman this country, we feed folks all over the criticized is because most folks just do says, we simply cannot single out the world. We grow the finest quality agri- not understand it. What we do in the agricultural community to balance the cultural products of anybody in the United States is we have invested over budget. One thing that our chairman of world. the last 10 years an average of $15 mil- the Committee on Agriculture is com- lion a year into the peanut program. mitted to do is to ensure that all cuts Mr. KINGSTON. Mr. Speaker, I think That program in Georgia alone last that are made are taken in a propor- the average American farmer feeds year was a $2.5 billion industry. I do tionate, on an equal basis with other something like 187 people, and 126 peo- not know how many jobs it created, programs, and agriculture is not sin- ple outside of America, so the produc- just in the State of Georgia alone. Pea- gled out. tion is unbelievable. I did not want to nuts are grown from Texas all the way Let me just address one other point break down the gentleman’s train of to Georgia, up the seaboard, all the that is very crucial, Mr. Speaker, and thought there. way into Virginia. it is something that folks who are op- Mr. CHAMBLISS. The gentleman is Mr. Speaker, really what our farm posed to the farm programs contin- exactly right. Let me tell the Members programs are are investments by the ually point out. That is that there is a what we have been thinking about in U.S. Government into our agriculture myth out there if agriculture programs the Committee on Agriculture, as far community, into our States, that cre- are cut out, that the housewife will see as the 1995 farm bill is concerned. We ate jobs, they provide an income for a difference in the price at the retail have in place now two agreements, the people, and we get a significant return store. That simply is not true. GATT agreement as well as the off of those programs from the stand- We have had testimony after testi- NAFTA agreements. Those two agree- point of income to our farmers, as well mony in the Committee on Agriculture ments are going to dictate certain re- as providing crops. from individuals who are involved in quirements on the agriculture commu- Mr. KINGSTON. Mr. Speaker, if the manufacturing who will tell us that nity from a subsidy standpoint. gentleman will yield, one of the things even if we take a price cut, or even if We know that when NAFTA and we are telling farmers from the gentle- there is a price cut in the support GATT are fully implemented, that we man’s district and my district and all price, there will not be a reflection of are going to have to transition into a over the country is despite the fact that cut in the retail price. They will true free world market, and we in the that we have gone from $26 billion in a use that money either to add to their Committee on Agriculture are prepar- government investment to $10 billion bottom line, to show their stockholders ing to do that. We are working very over a net year period of time, they are that they have made more money, or diligently towards modifying and still going to have to change if we are they will take that money and put it in changing programs to ensure that our going to have a program. We are mov- promotion to advertise their products. folks involved in agriculture are able ing these programs into no net cost Therefore, there is not going to be a to compete in the world market when programs. We are transforming them. change in the price at the retail store those treaties are fully implemented. If people want status quo, they lose out if there are cuts in price supports. That Mr. KINGSTON. I would ask the gen- in 1995. That is not what the taxpayers myth simply does not exist. Mr. KINGSTON. Mr. Speaker, I think tleman, Mr. Speaker, is it not true that want. They want a balanced budget, the gentleman has summed it up. France subsidizes their farmers? Most which means we are going to have to European countries subsidize their all do more. f farmers. Is it not true that American What we try to do, Mr. Speaker, is measure agriculture with the same A MESSAGE FROM CARDINAL farmers cannot even sell rice in Japan O’CONNOR TO CONGRESS, RE- because of the tariff agreement? yardstick that we measure social pro- grams. When we are looking at social MEMBERING APRIL 16, 1995, AND So even as we look at GATT, and programs, if we are going to vote to cut CLARIFYING THE MEANING OF look at NAFTA, it is not a perfect them, then we need to be able to say THE WORD ‘‘COVENANT’’ world. We are not going out there on a we are going to do the same thing to The SPEAKER pro tempore. Under a free world basis, because of still exist- agriculture. previous order of the House, the gen- ing trade barriers and still existing What the farmers are saying to us is tleman from California [Mr. DORNAN] is subsidies by foreign governments to ‘‘We realize that, as long as you are recognized for 5 minutes. their farmers who are competing with fair and across the board, and do not Mr. DORNAN. Mr. Speaker, I hope an our American farmers. Is that not the balance the budget on the back of average C–SPAN audience is here for case? farmers.’’ In fact, we could not, be- an exciting special order I guess to fol- Mr. CHAMBLISS. If the gentleman cause even if we eliminate all farm low, but also because I have a message will yield, he is absolutely right. Not spending, it constitutes three-fifths of from a very important prelate of the only France but countries like Spain 1 percent of the entire budget. It will Holy Roman Catholic Church. highly subsidize their farmers. They not balance the budget if we eliminate Mr. Speaker, when the Los Angeles compete against us in the world mar- it completely. Times wrote about my presidential an- ket. We simply cannot do that and be What we are trying to get across to nouncement week in New Hampshire able to make a profit in our agriculture folks, Mr. Speaker, even still, we have and New York, their traveling reporter community. to change the program in order to be in left out the high point of our whole June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6381 trip. It happened on Easter, and it was this whenever you drink it in remem- every year because of their jobs, more absolutely the most moving moment brance of me.’ ’’ than all the newly reported AIDS cases for me, for my wife, and our five grown Anybody who has seen an Indiana reported in 1992. And more than 6 mil- children, and for our nine grand- Jones movie knows that the Old Cov- lion workers suffer serious injuries and children. enant, the Ark of the Covenant, was illnesses every year because of their At St. Patrick’s Cathedral in New between Abraham and God. The New work. That is more than twice the York, the best-known clergyman in all Covenant is Jesus Christ, our Savior, number of people who live in the city of North and probably South America, who redeemed us with His death on the of Chicago. And it happens every single John Cardinal O’Connor, from the pul- cross, redeemed us with His precious day. pit, during the homily at Easter High blood. The New Covenant is not Bill or On an average day, 16,000 Americans Mass, his Mass, gave a U.S. Congress- Hillary Clinton, and I am sure Mother are injured at work. On an average day, man the following assignment. Teresa the other day, when she spent 154 Americans are killed by job-related He said: the better part of the day with the injuries and occupational diseases. We I noted during communion time the pres- First Lady, would have made that very know how many people are killed and ence of Congressman Bob Dornan. Bob, you clear to Miss Hillary if she had asked injured in auto crashes and we are hor- can tell the Congress, and through your ‘‘Mother Teresa, are we perchance the rified by it and we demand that the radio and television programs, the people of New Covenant?’’ I think that settles Government take action to make our the United States, that St. Patrick’s Cathe- point 1. More about point 2, 4, and that dral is not a tomb of dead dreams but a vi- highways safer. We know how many brant temple of hope; that the hearts of our infamous point 3, later. people are killed and injured in air- Catholic people are by no means empty with f plane accidents and we rightly demand dead faith, but are filled with living faith, a safer airports and airplanes. The Direc- faith that will not be ignored, a faith that, SAFETY IN THE WORKPLACE tor of the Occupational Safety and however ridiculed, however derided by cyn- The SPEAKER pro tempore. Under Health Administration has said that ics, will continue to blaze forth through this the Speaker’s announced policy of May ‘‘if a plane crashed every day in this land to radiate goodness and to bring hope to 12, 1995, the gentleman from Illinois millions. country, the hue and cry for action [Mr. DURBIN] is recognized for 60 min- would be deafening.’’ But when a plane Those are stirring words, Mr. Speak- utes as the designee of the minority full of Americans die at work each day, er. I will do what Cardinal O’Connor leader. silence is all we hear. These are not asked of me, I have just done it, be- Mr. DURBIN. Mr. Speaker, I rise to just numbers. They are real people. cause his Christian conviction is my defend the right of every American to Their only fault is they get up and go family’s conviction, all 20 of us. I truly be safe and healthy at work. Americans to work every day to provide for them- believe the Cardinal expresses the sen- who do the right thing and go to work selves and their family, and that is cer- timents of all loyal and practicing every day should not have to pay for it tainly no fault. They are our cowork- Christians. with their health or their lives. ers, our friends, our relatives, our fam- Easter Sunday, this last April 16, was I have two photos with me this ily, our neighbors. my Sally’s birthday and our 40th wed- evening, and I hope the camera can ding anniversary, so, after Mass, to the Darrell Drummer of Loves Park, IL. catch them. The first shows a job He was killed in a gravel pit when a left of the main altar, the altar where which I am personally familiar with, my parents were married June 27, 1929, cable came loose and struck him in the working in a slaughterhouse, which I head. He was 41 years old. Janice Sally and I stood in front of the very did when I was working my way baptismal font where I was christened Banks of Pulaski, TN, killed when the through college. It is tough work, it is lumber stacker she was working on fell in May 1933, and Sally and I renewed dangerous work. I have seen people lit- our sacred vows of matrimony. I want- up against her. Lloyd Mills, who lost erally mutilated and hurt on the job in his hearing because of this job, and he ed to share the special memories of this employment, and yet those of us this day with the L.A. Times, but they said, ‘‘Had I had the right to wear hear- who take for granted the meat in the ing protection, I would have worn it be- saw fit to ignore that any of that hap- grocery department do not realize how pened. I am still surprised. cause the longer I live, the longer I’m many men and women each day lit- going to have to listen to that hum- April 16, Mr. Speaker, 1995, is a day erally risk their own health and lives the Dornan clan will remember with ming in my ears.’’ Or the 25 workers in their jobs. who died in a poultry processing plant great fondness forever and ever. Amen. Below this is another photo in which in Hamlet, NC, trapped in a raging fire Mr. Speaker, a word about that fas- we cannot see the gentleman who is because the emergency exits had been cinating day following the State of the carrying it, but he appears to be a locked by their employers. Union message, when in 1 minute, I worker in some sort of a grocery outlet made four points. One of those points carrying a bag of bakery flour, which Unsafe workplaces are not limited to was stricken from the record, and I was of course can be a challenge at times, giant factories, meatpacking plants, removed from my speaking privileges depending on the size of it. and high elevation construction sites. for the rest of the day. I refused to Job hazards affect Americans who apologize because I believe everything b 2145 work in all kinds of jobs. They affect I said was historical, and I will revisit These are just two, I guess, regular the employees of nursing homes who this well at some point in the future to employment opportunities in America work in what has become one of the discuss point 3 that I was suppressed that we do not think much of. But the most dangerous jobs in America. They for, but I will at this point discuss reason that I rise this evening and in- affect workers in grocery stores who point 1. vite my colleagues to join me is to talk work with band saws that can cut I said that Mr. Clinton had about the men and women who go to workers as quickly as they slice meat. overstepped the bounds of decency to work each day in America and how safe They include locked exit doors that refer to his presidency as the New Cov- it is in their workplace. trap workers in fires, electrical haz- enant. At the moment of consecration Unfortunately, for too many Ameri- ards, toxic chemicals and noise that at every Catholic Mass, when the wine cans in all kinds of jobs, they pay each causes permanent hearing loss. is consecrated, the words are ‘‘the new day with their health and their lives. This special order tonight by my col- and everlasting covenant.’’ However, a The numbers are absolutely staggering leagues on the Democratic side of the week ago Sunday, the scriptural read- in America. Six thousand Americans aisle is a reminder to those who think ing from the Gospel hit it right on the are killed at work every single year, al- it is time to turn back the clock on job head. It is St. Paul’s letter to the Co- most twice as many as are killed by safety and health in the workplace, a rinthians, 11:23 to 26. Here is what I fires in the home. Fifty thousand reminder that the job is not yet done took exception to. ‘‘In the same way Americans die of occupational diseases and the victory is not yet won. With after supper, he,’’ meaning Jesus, every year, almost as many died in the me are Members of Congress from ‘‘Took the cup saying ‘This is the cup entire Vietnam War. Sixty thousand across the country, and I might add of the New Covenant in my blood. Do Americans are permanently disabled from both sides of the aisle now, and I H 6382 CONGRESSIONAL RECORD — HOUSE June 27, 1995 welcome the gentlewoman from Mary- Over the years, OSHA has decreased ment of the promise of our Constitu- land. They know the importance of the number who die in the workplace, tion. OSHA is for all Americans. safety and health in the workplace, be- or who die as a result of diseases con- The Republican juggernaut has cause they have worked for safety and tracted in the workplace, but OSHA launched a counterattack against the health laws for years. They know the has not done the job 100 percent. OSHA basic mission of our Constitution. The importance of safety and health be- must continue to exist. following examination of the Repub- cause they have constituents who have Congress must be concerned about lican proposals will expose the destruc- been killed and maimed at work. They the health and safety of all American tive nature of their ‘‘Death and Injury will tell you about the hazards Amer- workers. The blind and furious ideo- Act’’: logical war being waged by the Repub- ican workers face in food processing SUMMARY OF THE REPUBLICAN DEATH AND plants, coal mines, grocery stores, and lican Party against the Nation’s labor INJURY ACT unions has propelled the Republicans construction sites and they will tell After the September 3, 1991, fire at into a search and destroy mission you what the new majority in Con- the Imperial Food’s Hamlet Plant— against OSHA. This relentless attack gress, some of them, are proposing to where 25 workers were killed and 56 in- do in response, from cutting safety and places all American workers in harms jured—Mr. CASS BALLENGER, now chair- way. There will be a large number of health funding to gutting safety and man of the Subcommittee on Work- casualties. Already, more than 56,000 health laws. place Protections, told the Charlotte Mr. Speaker, it is not enough to say American workers die each year as a Observer, ‘‘it’s embarrassing that it that you care about the safety and result of accidents on the job or from takes a fire like this * * * before the health of Americans at work. The disease and injuries suffered at their news media makes a big enough deal American people will judge us by our places of work. Passage of legislation that people will say ‘OK, we’ll pay actions. I hope this special order will designed to disable OSHA will greatly more tax money’ (for worker safety). remind people of the importance, the escalate this unfortunate body count. It’s the squeaking wheel that needs the life-and-death importance, of a healthy Speaker GINGRICH has recently pro- grease and this wheel apparently and safe workplace. I hope it will en- claimed that politics is ‘‘war without hasn’t been squeaking loud courage Congress to work for real im- blood.’’ The reality is that the Repub- enough. * * * I think everybody agrees provements and real solutions. lican war on OSHA will provide pain I see among my colleagues this and suffering; and in many instances that it’s underfunded and bogged down evening the gentleman from New York their proposed ‘‘scorched earth’’ as- with bureaucracy.’’ Given this insight, can you imagine how utterly incompre- [Mr. OWENS], the gentleman from sault on OSHA will also produce blood. hensible it is that the Death and Injury Rhode Island [Mr. KENNEDY], the gen- Among the 56,000 casualties last year, Act is being proposed by Congressman tleman from California [Mr. MILLER], there were 10,000 who bled and died at the gentleman from West Virginia [Mr. the work site as a result of horrible ac- BALLENGER. WISE], and the gentlewoman from cidents. Let’s closely examine the Republican Maryland [Mrs. MORELLA]. I welcome It is not exaggerating at all to say Death and Injury Act. them all. that the proposed Republican OSHA re- The Ballenger bill viciously targets all work- Mr. Speaker, I yield to the gentleman forms, H.R. 1834, could be accurately ing AmericansÐwithout prejudice or discrimi- from New York [Mr. OWENS]. described as the Death and Injury Act nation. However, the suffering it will inflict on Mr. OWENS. Mr. Speaker, I thank of 1995. Provisions designed to protect workers and their families is not equally dis- the gentleman and congratulate him the health and safety of workers are tributedÐonly the workers lose. on this special order. I would also like being eradicated. The requirements of THE BILL to thank the leadership for taking this serious compliance by employers is This legislation is an assault on worker safe- opportunity to highlight a very impor- being demolished. Reasonable protec- ty and health protections. The Ballenger bill tant piece of legislation. I serve as the tions are being blown away leaving undermines the safety net for workers by: vir- ranking Democrat on the Subcommit- workers dangerously exposed and de- tually eliminating the general duty of employ- tee on Workforce Protections of the fenseless. As a result of this Repub- ers to maintain a safe and healthy workplace; Committee on Economic and Edu- lican invasion of every worthwhile making it almost impossible for OSHA to in- cational Opportunities. Government program there will be a spect workplaces and issue citations; taking Mr. Speaker, I have in front of me a criminal escalation of the body count. away the right of workers to raise safety and package of printouts listing a portion Before the Republican aggression health concerns without fear of employer re- of the 10,000 Americans who died in the against programs they target as en- prisals; making it harder, if not impossible for workplace last year. About 56,000 die of emies, there is always a barrage of OSHA to set standards; and eliminating impor- accidents that take place in the work- propaganda attempting to pulverize tant job safety agencies. place and of diseases contracted in the the facts and the truth. Always there workplace. But 10,000 die in the work- are bombardments of disinformation ENFORCEMENT place, at the workplace. I think that it about Government bureaucracies. Like Ballenger guts the enforcement pro- is important that we note that there most Government agencies initiated by visions by shifting 50 percent of the re- are names and addresses of human Democrat Franklin Roosevelt’s New sources for this activity to consulta- beings here. They are very real. Deal and Democrat Lyndon Johnson’s tion. To focus this agency’s energies on The notion that government agencies Great Society, OSHA is not the blun- nonenforcement compliance activities like OSHA exist only to make work for dering irrelevant entity described by further erodes OSHA’s ability to pre- bureaucrats or to make life unpleasant the Republican propaganda machine. vent hazards likely to cause death and for businesses is untrue in most cases, OSHA is very much in accordance with serious physical injuries. OSHA’s en- but certainly in the case of an agency the mission of the U.S. Constitution forcement program is woefully inad- like OSHA, we can clearly prove it to ‘‘to promote the general welfare.’’ equate. At current levels of inspec- be untrue. One of the great things Promoting the general welfare of tions, Federal OSHA can inspect work- about the Vietnam War Memorial is workers involves providing basic pro- places only once every 87 years. Under the fact that it does give individual tections of their health and safety. The Ballenger there will be no inspections— names. No more Tomb of the Unknown workplace should not be a place which no enforcement. Soldier. You know exactly who it was diminishes the opportunity and dam- Ballenger permits the employer to who died and what day they died, and I ages the capacity of any American to self-evaluate by conducting its own think that to humanize what happens engage fully in their right to the ‘‘pur- ‘‘safety audits’’. Workers will not have in this great so-called bureaucracy of suit of happiness.’’ Although organized access to these audits. If this isn’t the the Federal Government, it is impor- labor led the fight to create OSHA and fox guarding the chicken coop, I don’t tant of us to take a look at the actual unions play a major role in enforcing know what is. Fifty-six thousand list of names and addresses of the the regulations, OSHA is not a gift of American workers die each year from human beings who have died in the the Democratic Party to union mem- accidents on the job or disease and in- workplace. bers. OSHA represents a logical fulfill- juries suffered at their places of work. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6383 Ballenger guarantees an escalation in agency which has been very successful the 56,000 names of the casualties of last work-related deaths. in reducing fatalities and injuries in year's work place hazards. We propose to Ballenger prohibits OSHA from issu- the mine industry. Ballenger places the begin with North Carolina where, a few years ing citations to first time violators. Al- lives of workers in 14,500 mines in this ago, 25 workers in a chicken parts packaging though, under current law, a citation is Nation at risk. plant perished. During a hearing before the issued within 6 months of the inspec- Ballenger eliminates NIOSH—the Subcommittee on Workplace Protections there tion, and employers can request an in- only agency in this country that con- was also a mother from North Carolina who formal conference to resolve the cita- ducts research on worker safety and pleaded with the committee not to destroy tion (even before a hearing takes health. Ballenger eradicates any pos- OSHA. She had already lost one son and a place); it is not enough for Ballenger. sible major research effort in health second son was gravely ill as a result of acci- This bill sends employers the message and safety; placing all American work- dents at the plant where they worked. that they will not be punished until ers at risk. Speaker GINGRICH defines politics as they are caught, not once but twice, by The disruption caused by the Death war without blood; however, the kind OSHA. Therefore, many employers will and Injury Act by needlessly combin- of politics being pushed by the Repub- not comply. ing MSHA and OSHA and eliminating lican Death and Injury Act is very Ballenger slashes fines and employers NIOSH, will cost the Federal Govern- much a life and death matter. Children who violate laws for which there is no ment time, money, and experienced will lose fathers and mothers; wives specific standard, such as ergonomics staff. Most importantly, however, it will lose husbands; parents will lose or indoor air quality, will never be will cost thousands of innocent lives— sons and daughters; Americans will die fined. The General Accounting Office the lives of men, women and young as a result of these reckless changes [GAO] has observed that civil penalties people who go to work to help support being proposed to dismantle OSHA. accessed under the OSHA Act are inad- their families, pay for their education This brand of politics is too extreme. equate to deter violations of the act. In or simply to earn a living. This kind of political war is too deadly. 1993, the average penalty collected for This Death and Injury Act is a men- b 2200 a serious OSHA Act violation was $550. ace to all Americans. A fully function- Mr. DURBIN. I thank the gentleman As a matter of fact, a report in the ing OSHA offers an umbrella to all for his contribution this evening. His Daytona Daily News highlighted a Americans. The children, families, and position as ranking member of the sub- Georgia company that paid a $2 fine for relatives of workers benefit when committee which has jurisdiction over an OSHA Act violation which resulted workers are protected. Against the Re- this issue certainly gives him a good in the deaths of two employees. publican attack on OSHA the majority view of the issues, and I appreciate the Ballenger insures violators will not of Americans must mobilize to defend analysis which he has given us. have to pay. themselves. Speaker GINGRICH has stat- At this point I would like to make it PROTECTION OF EMPLOYEES FROM ed that his brand of politics is war clear and I hope I made it clear in my DISCRIMINATION without blood. It must be remembered opening statement that that statement Ballenger requires workers to inform that even before the Republican dec- about worker safety, this special order, employers of complaints before con- laration of war against OSHA there is a bipartisan effort, and I am happy tacting OSHA. The right to confiden- were 56,000 casualties each year. There to recognize one of my friends and one tiality is eliminated and as a result, re- is already too much blood. A war of my colleagues, the gentlewoman taliation against workers who file com- against OSHA will be costly. A war from Maryland [Mrs. MORELLA], a Re- plaints will escalate. Employees will against OSHA is madness that must be publican Member, who is going to ad- not report safety and health hazards, halted immediately. dress the question of worker safety as or illness and injuries, fearing that The 56,000 casualties represent real people it relates to Federal workers. they will lose their jobs. Ballenger with names and faces. These are real people Mrs. MORELLA. Mr. Speaker, I compromises the protection of workers who left loved ones behind. These are real thank the gentleman very much for from discrimination: Ensuring the vic- Americans who were lost despite the reason- yielding. As a matter of fact, I thank timization of the American worker able efforts of their Government to protect him very much for arranging for this into the 21st century. them in the work place. We cannot con- special order tonight. Ballenger gives employers the right sciously accept policy changes which will Mr. Speaker, I appreciate this oppor- to blame workers for not following guarantee that more Americans will die. tunity to express my concern about the safety rules in order to overturn cita- Our society places a high value on statis- health and safety conditions in the tions and fines. Ballenger generously tics. Each year for each holiday we broadcast Federal workplace. The U.S. Govern- provides employers with opportunities the holiday highway death count. We deplore ment should be setting the example for to avoid sanctions for hazardous work- the statistics which tell us that homicides by all employers in providing a safe and place violations. gunshot are out of control. Last year there healthy work environment. Ballenger makes it easier for employ- were 16,000 gunshot homicide victims. And, We tend to forget that that scientist ers to randomly drug test workers. or course the periodic Vietnam War body at the National Institutes of Health Ballenger makes a mockery of a per- count led thousands of Americans to protest in who is isolating the colon cancer gene sons right to privacy. the streets. It should be noted that of the Viet- and the breast cancer gene is a Federal OCCUPATIONAL HEALTH AND SAFETY nam War Memorial there are 57,000 names of employee, that the meat and health in- STANDARDS those who died during the entire war. In con- spectors are Federal employees, that Ballenger prevents OSHA from set- trast, there are 56,000 American work-place they are taking care of us and the least ting standards unless they can prove casualties each year. we can do is to provide the adequate that the costs will not exceed the bene- We Americans place a high value on human workplace environment to protect fits. Ballenger effectively restricts the life. Large numbers even insist on protecting their health and safety. Federal work- cost for worker health and safety to unborn life in the wombs of mothers. To de- ers, however, are still faced with work- zero. feat the Republican Death and Injury Act we place health and safety hazards that Ballenger lets companies overturn must raise the level of our voices and in every are causing a high rate of injuries and safety and health standards in court way possible inform the voters. This is not ab- illness. Frankly I do not really see and tie up the standard process in red- stract politics. These are living, breathing, this, as the gentleman from Illinois tape. Ballenger forestalls the develop- working citizens who are being protected. Per- [Mr. DURBIN] mentioned, as a partisan ment of standards for ergonomics, in- haps the Republican warmongers will get the issue. Federal employees are Repub- door air quality and other emerging message if we follow the example of the Viet- licans, Democrats, and, independents, hazards, indefinitely. nam War Memorial. This great monument Americans are Republicans and Demo- MINE SAFETY AND HEALTH AGENCY [MSHA] AND ends the practice of celebrating unknown sol- crats and independents, and Americans NATIONAL INSTITUTE FOR OCCUPATIONAL diers. Carved on that great wall are the names care about the safety of the Federal SAFETY AND HEALTH [NIOSH] of all the individuals who died. workers in the workplace. Ballenger collapses MSHA into Mr. Speaker, each day I propose to enter For decades Federal safety councils OSHA, effectively eliminating the into the CONGRESSIONAL RECORD a portion of were formed to address the high injury H 6384 CONGRESSIONAL RECORD — HOUSE June 27, 1995 rates among Federal employees. Fi- reasonable steps to protect our Federal sisters, we expect to see them come nally, in 1970, Congress passed the Oc- workers. home in the evening in as good a shape cupational Safety and Health Act The American Federation of Govern- as they left, but as has already been [OSHA]. This legislation required every ment Employees (AFGE) conducted a pointed out here this evening, for tens Federal agency to establish an effec- study in 1992 relating to repetitive mo- of thousands of workers a year that tive safety and health program. tion injuries at the Social Security Ad- does not happen, and unfortunately for OSHA’s Office of Federal Agency Pro- ministration. Let me share the alarm- tens of thousands of workers it costs grams was responsible for implement- ing results: them their lives. ing the program, which relied on vol- 78.4 percent of the employees sur- What we know since the advent of untary compliance. veyed experienced pain in their shoul- OSHA obviously is that these accidents Without an enforcement mechanism, ders, arms, elbows, and/or necks. are preventable, and the workplaces of workplace programs to protect the 53.9 percent have had pain, aching, America can be made safe, they can be health and safety of the Federal em- stiffness, burning, numbness, or tin- made safer if not completely safe, and ployee are dismal and uneven. They gling in their hands more than three the accident rate can be impacted in a simply do not work. OSHA reports that times and lasting more than 1 week. very, very positive manner. In fact for 1991, there were more than 170,000 56.5 percent wake in the night or in since OSHA came into being the acci- work-related injuries and illnesses in the morning with pain, tingling, or dent rate has dropped by over 50 per- the Federal Government, at a cost of numbness in their hands, fingers, arms, cent. In some of the toughest indus- more than $1.5 billion. or shoulders—carpal tunnel syndrome. tries we see that the protective stand- While workplace hazards continue to These injuries are preventable. It is ards that have been set forth by OSHA grow, the staffing levels at the Office cheaper to take steps to prevent the have had an impact. In the construc- of Federal Agency Programs [OFAP] pain and suffering, rather than paying tion industry, where there are protec- have decreased. This is another matter for lost work time and expensive sur- tive standards now for trenches that of great concern to me. OFAP has only gery. are being dug, where before hundreds of 8 full time professionals compared to 25 Mr. Speaker, to protect our Federal people lost their lives and thousands of during the Ford administration. Budg- employees, I recommend the following: people were injured in the cave-ins in et constraints have limited OFAP’s Enforcement mechanisms to compel trenches, we now see that those acci- evaluations of Federal agency pro- agencies to meet safety and health dents and fatalities have declined by 35 grams to two per year. The number of standards; percent. In industries where lead and Federal agency safety and health in- Top management commitment to ad- high concentration of lead is used, spections has also decreased by 40 per- dress safety and health problems; thousands of smelting and battery cent since 1988. Protection for workers who report plant workers suffer from anemia, unsafe conditions; nerve disorders, seizures, brain dam- OSHA is required to conduct annual The right of workers to refuse work age, and even death as a result of pro- safety and health program evaluations that is dangerous; longed exposure to lead before OSHA at 15 agencies which employ 2 million Safety and health labor/management issued its standard in 1978. Now we see Federal workers. However, OSHA has committees. that those same workers with high conducted only 16 out of 150 evalua- Mr. Speaker, we must work to- concentrations of lead in their blood tions of the targeted 15 agencies man- gether—in a bipartisan fashion—to pro- has dropped by 66 percent. dated by law since 1982. A report by the tect the health and safety of Federal Grain handling, where we had a rash General Accounting Office [GAO] con- employees in their work environment. of explosions, hundreds of workers and cluded that even when OSHA does in- They work for us; we must not ignore thousands injured in grain dust explo- spect a Federal workplace, it does not their safety. sions prior to the standards in 1988. We use that information to assess the Again, I thank the gentleman from now see that these fatalities have agency’s safety and health program. Illinois for arranging this special order, dropped since those standards by 58 The lack of resources at OSHA, cou- and I was honored to be part of it. percent, and the injury rate has pled with a lack of commitment by Mr. DURBIN. Of course we are hon- dropped by 41 percent. We see cotton most agencies to evaluate their man- ored to have the gentlewoman’s par- dust, where hundreds of thousands of agers’ performance in the area of ticipation in this bipartisan special America’s textile workers contracted health and safety, put Federal employ- order. brown lung, the dust from the cotton ees at risk on a daily basis. I would like to at this point yield to processing, and we now see the dra- In the private sector, OSHA conducts my colleague from the State of Califor- matic drop in the cases affecting brown an independent, objective review of nia, Mr. GEORGE MILLER. He has served lung, and we also see there that it may health and safety allegations. In the on what was then called the Committee have very well been responsible for Federal sector, however, the agencies on Education and Labor, and he is very making that industry competitive in investigate themselves. In the private familiar with the issue of worker safe- worldwide competition as they were sector, there is an enforcement mecha- ty. forced to modernize because of those nism. Private firms can and have been Mr. MILLER of California. I thank standards. shut down for health and safety viola- the gentleman very much for yielding So what we really see is in the 3 tions through systematic fines and and for calling this special order to ad- years following an OSHA inspection their publication. dress what is a very, very serious and fine, injuries at the inspected The health and safety concerns in the threat to American workers, and that workplace decline by as much as 22 per- public sector mirror the private sector. is the demise of OSHA that is being cent, and we have seen that the injury Asbestos fiber release in buildings, Le- presented to our Committee on Edu- and illness rates have fallen where gionnaire’s disease, accidental death cation and Labor in the guise of re- OSHA has concentrated its enforce- due to poor training and supervision, form, but in fact it guts the basic te- ment, mainly in construction, manu- and failure to properly ventilate ma- nets of OSHA and the basic enforce- facturing, oil and gas extraction. These chine shops are among the common- ment mechanisms of OSHA. are all testimonies to the fact that place concerns in both the public and As the gentleman rightly pointed out these protective standards have worked private work environments. when he took the well this evening, to protect the American families. They Just as in the private sector, the millions of Americans go to work every have worked to protect the American greatest number of workplace injuries day, and they play by the rules, they worker. They have saved both the em- are occurring in repetitive motion oc- work hard, and what they do not need ployer money, the employee money, cupations, primarily where computer is to engage in an accident at work or the health care system money, the and video display terminals (VDT’s) have an unsafe workplace take its toll workers’ compensation system money, are used. In the Federal sector, the on them or members of their family. and that is the result that we said we workers most likely to sustain these When we send our spouses or our par- wanted in 1970, and that is the result injuries are women. We need to take ents off to work or our brothers and we are getting. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6385 Have some of these standards caused and they lost them in industrial acci- that accident; an accident that did not industries to strain to meet those dents. have to happen in the first place. standards? Yes, they have. But what we I have seen workers hit by cables and But the tragic loss of life and the in- have also seen is that we have gotten snapped by ropes because safety proce- juries were completely avoidable had back the benefits of those standards. dures were not in place when I was the law been followed and had we had We now see that where, as the gentle- working in those industries. I have people who respected the dignity and woman from Maryland just talked seen workers go in the tank farms in the rights of those workers. about, cumulative repetitive motion the oil refinery, I have gone in, with no So I want to thank the gentleman for distress, carpal tunnel syndromes, we protective gear, no breathing gear or taking this time in this special order. I now see a 770-percent increase in those skin protection. And I have seen the think we need to talk more about this. injuries. We have got to figure out how workers suffer the consequences and I think we have got to educate that it to address that, to take sure that those pass out on the job from the fumes, un- is OSHA that has provided the safe people can continue to earn a living able to go back into those tanks and workplaces in this country for Ameri- without being disabled and their em- come into contact with those chemi- ca’s families and we should not have to ployers can save the money from hav- cals. go back, we should not have to go back ing a safer workplace. I have seen people lose their hands in where the workplace is based upon the OSHA is trying new programs. They hay bailers. Why? Because safety pro- whims of the employer as opposed to are trying to make sure that OSHA cedures were not in place. Those are the right of a worker and their families works better for the employers, for the the same industries that are in my dis- to have a safe workplace. employees. No longer are there quotas. trict today. All of those industries now That is what OSHA provides today. No longer are people rated by the num- have a safety record that was unheard But that is not, that is not what the ber of inspections they do or the pen- of, unheard of prior to OSHA. OSHA legislation that the Republicans want to pass would provide for workers alties that are assessed. We have seen And I would just hope that people in the future. And I thank the gen- the simplification of the standards. We would understand that this is not a tleman. have seen compliance assistance, help- fight between the AFL–CIO and the ing small businesses to meet these American Manufacturers Association. OSHA WORKS standards. I think some 24,000 small This is about the safety of America’s I. OSHA'S MISSION businesses have been helped with this families. People who go off to work Congress created OSHA in 1970 ``to assure and hazardous free inspections, no cita- every day to earn a living. so far as possible every working man and tions, no fine, helping the small busi- And many of these people, millions of woman in the Nation safe and healthful condi- nesses make their place for the worker. Americans earn those livings in dan- tions.'' OSHA's fundamental mission is as im- portant to America's working families today as b 2215 gerous workplaces. Simply because of the occupation, they are dangerous. it was a quarter-century ago. In a program in Maine they took the The 1970 OSH Act authorized the agency to But they can be and they have been 200 most unsafe workplaces and they issue and enforce protective standards, and to made safer by the OSHA regulations. said, You can voluntarily inspect your provide compliance assistance through con- And we cannot succumb as a Con- own workplace or we will give you a sultation, education, and training. The 1970 gress, we cannot talk about the impor- wall-to-wall inspection. The workers OSH Act gave states the option of establishing tance of our families, we cannot talk for the most part, the employers de- their own state OSH agency; to date, 23 about the importance of a worker being cided they would inspect their own states have done so. able to sustain the economics of their workplace for hazard. They found II. WHY OSHA WORKS family and household income and then 100,000 hazards. 100,000 hazards; 14 times By developing protective standards, and resort to the kind of legislation that is higher than OSHA’s own rate of inspec- making employers more safety conscious, being proposed to us in the Education tion in identifying hazards. And almost OSHA has made a real differenceÐoften the and Labor Committee and being sent to half of these have now been abated difference between life and deathÐto millions the floor of this House basically on a since that program was recently start- of working Americans. Overall, the workplace party line vote by the Republicans that ed. fatality rate has dropped by over 50% since would take away the rights of employ- So what we see is that OSHA can OSHA was created in 1970, according to the ees to go to OSHA to demand a safe work very well with employers. In my National Safety Council. workplace, would take away the re- district, heavy concentration of the oil a. OSHA's Protective Standards Save Lives. porting of how many times did the em- and chemical industry, we have hun- Here are just a few examples of how OSHA ployees tell the employer their work- dreds of millions of dollars of refinery has saved lives and improved worker health place was not safe. work going on now. The major oil re- and safety through the promulgation of haz- fineries, Exxon, Union, Texaco, Chev- The employer, under the new law, ard-specific protections: ron, and Shell. And we have hundreds would not be required to keep records. Trenches. Thousands of construction work- of thousands of worker hours, because They could disregard that. And when ers were buried alive in trench cave-ins before of safety committees, because of OSHA an accident takes place, an injury OSHA strengthened trenching protections in compliance, because of learning how to takes place, no penalty to be paid. You 1990. Since then, trenching fatalities have de- set it out and get a work plan together get a citation and are told to clean it clined by 35%, and hundreds of trenching ac- and where the workers in some of the up. And if you do not clean it up, you cidents have been prevented. most dangerous industries in this coun- are still not held liable under the law. Lead. Thousands of smelting and battery try are working hundreds of thousands This is not the way to protect Ameri- plant workers suffered anemia, nerve dis- of hours without job loss. ca’s families. This is not the way to orders, seizures, brain damage and even Let me say before I came to Congress protect family’s children from having death as a result of prolonged exposure to I worked in a lot of these industries. I to lose a mother or father in a work- lead before OSHA issued protections in 1978. have driven trucks. I have worked on place accident. And this is not the way The number of workers with high-lead con- tugboats. I was a firefighter. I worked to protect workers from those employ- centrations in their blood dropped by 66% in in the oil refineries. I worked on the ers who will violate the law, as we saw the ensuing five years, markedly improving the farms and ranches bailing hay. I have in the tragic chicken factory fire in health of workers in these industries. been a tree faller, in the construction North Carolina where the employer Grain Handling. Hundreds of workers were industry, commercial fishing, in the thought they could get more productiv- killed and thousands injured in grain dust ex- merchant marines and oil tankers. ity out of their workers if they chained plosions before OSHA issued protections in I have seen the workers who have the doors closed so that the workers 1988. Since then, according to the grain in- fallen from great heights and the work- couldn’t get out in the fresh air. And dustry's own data, the fatality rate has ers who suffered damage from toxic then, when the fire started, the work- dropped by 58%, and the injury rate has chemicals. And I have shaken more ers were burned up and people lost dropped by 41%. hands in my district with three fingers their spouses and mothers and fathers Cotton Dust. Several hundred thousand tex- on those hands than can be imagined, and lost their sons and daughters in tile industry workers developed ``brown H 6386 CONGRESSIONAL RECORD — HOUSE June 27, 1995 lung''Ða crippling and sometimes fatal res- There are staggering economic costs as agenda; redesigning the agency's field offices piratory disease-from exposure to cotton dust well: safety accidents alone cost our economy to streamline the complaint process, reduce before OSHA issued protections in 1978. That over $100 billion a year, and occupational ill- paperwork, and focus more on results; estab- year, there were an estimated 40,000 cases, nesses cost many times more. We all bear lishing customer service standards (in a recent amounting to 20 percent of the industry's these costsÐas employers, as workers, and survey, over 75% of employers found OSHA workforce. By 1985, the rate had dropped to as taxpayers. inspectors to be professional and knowledge- 1 percent. New workplace hazards are emerging as able); establishing the Maine Team Concept b. OSHA's Enforcement Program Saves our economy changes to meet the demands of Pilot Program to empower front-line inspectors Lives. Millions of working Americans have also the new global marketplace. For example, cu- to use their own judgment in deciding how to benefitted directly from OSHA's enforcement mulative trauma disorders have increased make the best use of their resources (In FY94, program. Most employers have reported that roughly 770% in the past decade. at the participating field offices, the number of their workplaces became safer after OSHA in- Other federal programs may provide job inspection hours increased by 86%, delays be- spected them; a recent study confirmed that in training, civil rights protections, a minimum tween inspection and citation dropped by 30%, the 3 years following an OSHA inspection and wage, or collective bargaining rights. But what and the employer contest rate declined by fine, injuries at the inspected worksite decline good are they to a worker who is killed or dis- more than 50% as inspectors adopted a less by as much as 22 percent. In fact, since 1975 abled on the job? adversarial enforcement approach); establish- injury and illness rates have fallen in industries IV. MAKING OSHA WORK BETTER ing pilot programs to improve response time in which OSHA has concentrated its enforce- In the past, OSHA has been criticized for fo- from complaint to abatement (reduced for ment activitiesÐconstruction, manufacturing, cusing too much on nitpicky technical viola- nonformal complaints from 61 days to 9 in and oil and gas extractionÐwhile they have tions, and too little on eliminating serious safe- Cleveland and from 35 days to 5 in Peoria); risen in other industries. ty and health hazards. OSHA must improve its In fiscal year 1994 alone, OSHA inspections simplifying recordkeeping requirements; and targeting of the most dangerous hazards and expediting FOIA request processing. helped make over 40,000 workplaces safer for workplaces, particularly given the ever-widen- nearly 2 million working Americans. There is ing gap between OSHA's resources (1,000 in- Mr. DURBIN. Mr. Speaker, I thank no shortage of examples of successful en- spectors) and responsibilities (3.7 million work- my colleague from California for that forcement efforts: places). Under the leadership of Assistant excellent statement. And I would like Following a 1991 inspection, a West Virginia Secretary of Labor Joseph A. Dear, OSHA to at this point yield to my colleague, vending machine manufacturer instituted a has begun to refocus its mission to maximize the gentleman from West Virginia, Mr. safety program and lowered its lost workday its impact on worker safety: BOB WISE, who is familiar with another injury rate by 73 percent. No Inspection Quotas. The number of in- aspect of employment in America that OSHA inspected a Cleveland construction spections is no longer an agency performance at one time was the most dangerous. site in 1994, insisting that workers wear safety measure. Neither is the amount of penalties And were it not for efforts that have belts while working on a scaffold 70 feet assessed. Instead, performance measures will been made at Federal and State levels, above the ground. Four days later the scaffold might still be the most dangerous and collapsed, but the workers were saved by their be based on real improvements in worker safety and health. still is very hazardous. And I would new safety belts. like to yield at this point to Mr. WISE. OSHA's 1989 inspection and $700,000 fine Standards Simplification. In October 1994, was the catalyst for Boise Cascade to improve OSHA asked the public and its field staff to Mr. WISE. Mr. Speaker, I thank the worker protections. The company implemented identify outdated, vague, conflicting or duplica- gentleman and he is correct. As he has a comprehensive safety and health program, tive regulations for simplification or elimination. spoken before on this floor for the cutting injury rates by 78 percent and worker's That effort is in progress. need, not only for OSHA but for MSHA, compensation costs by 75 percent. ``OSHA Compliance Assistance. In FY 94, OSHA's the Mine Safety Health Administra- played a key role in these accomplishments,'' consultants helped nearly 24,000 small busi- tion. The MSHA was created in 1969 as according to the company's counsel. nesses identify and abate hazards free of cita- the direct result of the Farmington Following a 1989 OSHA inspection and fine, tions and fines, under OSHA's consultation mine disaster. Finally, this country an automobile carpeting manufacturer estab- programs. had had enough. It had taken all the lished an ergonomics program at two Penn- Targeting the Most Dangerous Workplaces. bloodshed in the mines that it could sylvania plants. Cumulative trauma injuries de- Under the Maine 200 program, the 200 most tolerate and MSHA grew out of that. unsafe employers were offered a choice: im- clined by 94 percent and 77 percent respec- MSHA celebrated its 25th anniver- tively at the two plants over the ensuing 3 plement a comprehensive safety and health sary this year. But there may not be a years. program, or be put on a priority list for a wall- 26th anniversary should this legislation c. Safe Workplaces Save Dollars. Every to-wall inspection. The vast majority of em- workplace accident cuts into the employer's ployers chose the first option, with stunning re- pass. What this legislation would do, in profit margin. In 1992, for example, workers' sults. During the first 18 months of the pro- addition to what has already been compensation claims amounted to $44 billion. gram, participants identified nearly 100,000 talked about concerning OSHA, this Compliance with OSHA's protective standards hazards, at a rate over 14 times higher than legislation would merge MSHA and helps save lives, reduce injuries and cut these OSHA's own rate of identifying hazards OSHA together, of course cutting the unnecessary losses. For example, 2 years through inspections. More than half of these funding together and merging them to- after OSHA issued a cotton dust standard to newly-identified hazards have already been gether. protect workers from respiratory disease, The abated. Let me talk for a second about what Economist magazine reported that the re- Targeting Real Hazards. OSHA is the proposed legislation would do to quired protections were helping to make the refocusing its enforcement program on the MSHA. It would end mandatory inspec- industry more efficient. most dangerous hazards: Under a new fo- tions of surface mines. It would reduce III. DO WE STILL NEED OSHA? cused inspection program, construction em- mandatory Federal inspections of un- OSHA has had notable successes, but its ployers with safety and health programs will derground mines from 4 per year to 1 job is far from done: only be inspected for the four leading causes per year. of on-the-job deaths (e.g., falls, electro- Every year, work-related accidents and ill- It would eliminate the current sur- nesses cost an estimated 56,000 American cutions). Citations for the most common pa- prise factor in mine inspections by can- livesÐmore than the total American lives lost perwork violations have declined by 35% over celing mine inspectors’ rights to in- in battle during the entire 9-year Vietnam War. the past 4 years. spect mine workplaces without a war- On an average day, 17 working Americans Recognizing Excellence. OSHA's Voluntary rant. That is right. You have to call are killed in safety accidents, an estimated Protection Program recognizes employers who and get the permission to come on. If 137 more die from occupational disease, and have excellent safety and health records, ex- you do not get the permission to come another 16,000 are injured. Meatpacking work- empting them from general inspections. OSHA on, you cannot come on without a war- ers, for example, suffer an incredible annual expanded the VPP Program by 70% in FY94. injury and illness rate of 39 per 100 workers. Additional Initiatives. OSHA has taken many rant. And by that time, the surprise These incidents have a devastating impact on additional steps to refocus the agency on re- factor is gone. thousands of America's working families each sults including: increasing the involvement of It would provide several ways for op- year. stakeholders in setting the agency's regulatory erators to avoid inspection altogether June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6387 such as employing a consultant to cer- you hit it just right, you can dig right Do we not want the Federal Govern- tify that the mine has an effective safe- into a gas deposit and you can be ment to take action against employees ty and health program, thereby ex- snuffed before anyone knows what hap- who would jeopardize the well-being of empting the mine for virtually all in- pened to you. Methane is a very com- their workers? spections for the year. I bet we can find mon problem in mines. And, of course, Do we not believe that this is impor- a real industry developing in certifi- explosion is often a tragedy as well in tant to determine what is killing and cation consultants. mines. injuring people in America’s work It would prevent Federal mine in- That is what working in a coal mine force? spectors from closing unsafe mines for is all about. It is not something that is The answer is, of course, yes. The an- uncorrected hazards, extreme operator easily reduced to black and white. It is swer should be yes. But what I am negligence, or a pattern of violation. not something that is reduced to num- hearing from my colleagues from the One area of concern for me, it would ber on a page. It is a very, very dan- committee, the Republicans have said, ban workers from contacting the agen- gerous occupation. And anybody that no. cy unless they first raise the problem threatens that, even well-meaning, Every day workers are asked to gam- with their employer, even when the threatens that, I think has to be called ble their lives and take unnecessary worker faces imminent danger on the to account. risks because someone wants to cut job and the likelihood of retribution. I hope that this legislation does not corners. Today, while it is usually the It would eliminate penalties for mine pass. I thank the gentleman for taking contractor, today it seems like it is the operators violating the law, prohibit this position. This is another wrinkle Congress that wants to cut corners. Federal mine inspectors from removing to the OSHA debate. And in the hear- They want to cut corners when it untrained miners from the workplace. ings that the committee will continue comes to worker’s safety. Many want The gentleman knows it took us a long to hold, I hope this message comes to argue that today’s rules in OSHA time at the State and Federal levels to through loud and clear. This is not a are too restrictive and excessively in- get training requirements for miners in place to be reducing the deficit. fringe on a company’s right to do busi- the workplace. Mr. DURBIN. I thank my colleague ness. It would limit the rights of miners, for joining us this evening. And like What is so excessive about ensuring a including the right to take their own him, I have had the opportunity to be safe workplace? What is so excessive cases to court if they have suffered re- in a deep-shaft coal mine. It is a hum- about ensuring that thousands of work- prisals for maintaining their safety bling experience to be in that closed at- ers are no longer buried alive in trench rights. mosphere and you have described it so cave-ins, as was the case before OSHA This is not simply a deficit reduction well, to fear for your own safety every strengthened its protections of these issue or a budget reduction issue. It step of the way. workers in 1990? cannot be put on the paper in black That we should in any way diminish Since then, trenching fatalities have and white. And, yes, there are some this kind of inspection from the Fed- declined by 35 percent, and hundreds of that say Why do we need MSHA as a eral and State sources is, to me, just to trenching accidents have been pre- separate agency? Cut the funding and invite disaster and tragedy. And I cer- vented. put it in OSHA, because the fatality tainly hope that the legislative propos- In one instance, OSHA inspected a rate is down. als that we have heard will be more Cleveland construction site in 1994 and And happily, Mr. Speaker, it is down. sensitive to what men, and now insisted that the workers wear protec- It is down from 400 every year being women, are subjected to each day in tion gear while working on a scaffold 70 killed in the mines. As the gentleman these coal mines. feet above the ground. Four days later from Illinois [Mr. DURBIN] noted, the Mr. WISE. As the gentleman well the scaffold collapsed, but not one most hazardous industry in the coun- knows, whether it is the Centralia worker was killed because each one try, it went from 420 6 years ago to 84 mine disaster in Illinois or the Farm- was wearing the new protective equip- this year. That is testimony that ington mine disaster in West Virginia, ment. How does this protective gear in- OSHA is working; that MSHA is work- that is what has brought this to the at- fringe on a company’s right to do busi- ing. tention of the country. And, unfortu- ness? Because it costs money. That is It is still one of the most hazardous nately, State legislation, State mining why. It costs money. OSHA made the occupations. In West Virginia last year enforcement was not adequate. It is difference. We are here today to tell we lost 11 miners. That is a far cry better now and MSH has been driving our colleagues that we are drawing the from the 20-some we were losing just a for that and continues to do so. line. We will not stand for budget cuts few years ago. A far cry from the 50 and Mr. DURBAN. I thank my colleague. that destroy an agency that is charged 60 that we were losing a few years be- My colleague, the gentleman from with protecting American workers. fore that. Rhode Island [Mr. KENNEDY], is here. b I would like to point out to those And I thank him for joining us and 1030 who want to make it a black and white being patient to speak this evening. I Remember, we are protecting Amer- issue, think for a second about what yield to Congressman KENNEDY. ican workers. This is America, not a work in a mine is all about. Particu- Mr. KENNEDY of Rhode Island. third-rate nation, and we will be acting larly a deep mine. The gentleman from Thank you. I would like to thank my like a third-rate nation if we treat our Illinois [Mr. DURBIN] I know, knows the colleague from Illinois [Mr. DURBIN] for workers as if they were workers in a mines in Illinois. He has been associ- allowing me to be here for this special third-rate nation. That is why I com- ated with them for a long, long time. order. And as I rise to discuss with him mend the gentleman from Illinois [Mr. First of all, turn out all the lights in OSHA in terms of the problems that DURBIN] for working on this issue, and this Chamber and put on a blindfold, have been solved, the lives that have my colleagues that are standing up for because there is no light at the bottom been saved, and the injuries that have workers in this House, to make sure of a mine. The second thing to do, if been prevented by making the work- that we have a safe workplace, that has you want a real impression, now crawl place a safe place. And that has been the dignity that we would want and the under this desk that I am standing in because of OSHA. safety that we would demand for our front of. It stands about 3 feet high and The record of success is now at risk workers in this country. I do not think that is what a low coal seam is. because some want to crush OSHA’s we should accept anything less than a You have no lights now and you are ability as an agency to function, leav- safe workplace. I commend the gen- lying underneath this desk expected to ing today’s workers vulnerable and ex- tleman from Illinois for his work, and work under there. Now, imagine thou- posed, 40 stories above the ground on thank him for allowing me to be here sands of tons of rock about you. Not today’s job site. this evening. just a wooden platform, thousands of I want us to ask ourselves a few ques- Mr. DURBIN. I thank my colleague tons of rock above you. It is creaking, tions. Do we not as a Nation need to from Rhode Island [Mr. KENNEDY] for it is belching and it is moving. protect workers from the safety and joining us with a very forceful and ar- It is wet down there and on top of the health hazards that they are exposed to ticulate statement on this issue, par- creaking, you have the potential, if on the workplace? ticularly as it relates to construction H 6388 CONGRESSIONAL RECORD — HOUSE June 27, 1995 workers. We will continue this debate, someone got the power going. I will not Congress, there was one thing I wanted not only on the floor, but also in the tell the rest of the story about getting to do, and that was to erect a memorial committees and subcommittees. I the pumps going to start draining the to the men and women who died in thank you for joining in this special mine. mining, who had given their arms and order. The year that I was born was the legs and limbs and eyes to make it a The last speaker joining us this year of the Milford Mine disaster in the safer place to work. evening comes from the State of Min- Cuyuna Mountain Range south and Pete Minsoni said, talking about the nesota. Congressman JIM OBERSTAR is west of where I lived. The miners were action of the then Ford administration one of the most articulate spokesmen told to keep digging for that rich load to abolish the Federal Advisory Com- on behalf of working men and women. of ore, until they were well under a mittee on Mine Safety Standards, it The time I have served in Congress, he lake. And they could see the water had been enacted in 1966, 5 years later has risen many times to their defense seeping in, and they knew it was dan- they were proposing to abolish it. It fi- and is recognized as somebody in this gerous. But the mining company said, nally happened in 1975. He said, ‘‘Abol- body who has a very intimate and per- ‘‘Go on, go on, dig further and deeper, ishing the Mine Safety Review Board sonal knowledge of not only the men and keep going.’’ then, one day, the caused me concern, to think that be- and women he represents who work for lake caved in, and an entire shift was cause the review board had no work, a living, but those across the country. wiped out. Thirty-four men, only three some Members of Congress and the I yield to my colleague from Min- survived, as the lake swept into the un- public will be misled into thinking that nesota [Mr. OBERSTAR]. derground and drowned them all. the Government deserves a pat on the Mr. OBERSTAR. I thank my col- There was no mine inspector. There back for finally abolishing a Federal league for yielding and I join my col- was no Federal law. There was a weak agency.’’ He went on to say, ‘‘The rea- leagues in complimenting the gen- little State act that had been drafted son the Mine Safety Board did not have tleman for calling this special order to by the mining companies and run any work is there was no law to en- focus on the industrial workplace and through the legislature. It did nothing force.’’ There was nothing to review. safety. to protect lives. There were no teeth in mine safety leg- I have seen the face of tragedy in Then later I had my own experience islation. mining. I have lived with it. I am here in the Alworth Pit, watching helplessly He went on to talk about a good ex- because, for me, it is real, it is per- from afar while a 15-ton ore truck ample. The White Pine Copper Mine in sonal, it is family. backed over and crushed an elderly upper Michigan where the steel work- My father worked 40 years in the iron man. Natali never had a chance. No one ers unions represents some 2,600 work- ore mines of northern Minnesota, 26 of had ever taught him how to back a ers employed in one of the largest those years in the underground Godrey truck up. He had no training. And yet mines in our country. A fatality oc- Mine between my hometown Chisholm later when we got Mine Safety and curred when a foreman picked up a hot and nearby town of Hibbing. I never Health Act passed, companies pro- cable. The Mine Enforcement Safety worked in the underground. He never tested about the requirement for train- Administration inspectors found im- let me go down there. I worked in the ing and safety, how to back a truck up, proper grounding and a lack of control open pits. how to operate equipment safely. ‘‘Oh, boxes for electrical cable throughout But I will never forget the day my fa- that is second nature. People know the mine, a mandatory standard set by ther came home from a cave-in, where how to do that.’’ He did not know how the Mine Safety Act not enforced, paid he heard the timbers cracking, and in a to back up a 15-ton ore truck, and it no attention to. drift, he pushed his two coworkers out ran right over him. It snuffed his life Mr. DURBIN. I think we only have the mouth of the drift, and the ore out. just 2 or 3 minutes left. caved in right around him and stopped That isn’t just ancient history. Last Mr. OBERSTAR. What he went on to right at his throat. The timbers year, 1994, February, Duluth News say was the miners learned they do not cracked because the mining company Tribune. ‘‘Tragedy reminder of have a legal right to join mine safety was not willing to put in new timbers. mining’s risks.’’ inspectors. Standards are only advisory They were not willing to put in bigger It reads: and not mandatory. And only when and stronger oak in the mines, and he Twisted backs. Crushed feet. Ruptured ten- they had tough inspection standards, almost lost his life. dons. mandatory fines, mandatory inspec- I will never forget him as chairman Disabling injuries are common among tions, did we get safety in the mines. of the mining safety committee in the workers at Iron Range taconite mines. I just want to say that in all of underground saying the most horrible That’s because operating and repairing the America’s history, more men and memory was the awful screams of the heavy-duty machinery used daily in iron ore women have died in the industrial men when the cables broke on the cage, mining has inherent risks. Over the past cen- workplace in our country than died in and they went plunging to their death tury, Iron Range miners have learned to live with those risks. all the wars combined. Let it not be 100, 200, 300 feet, with nothing to save But sometimes the odds finally catch up. the epitaph of our generation that we them. No safety catches. Nothing to When Louis DeNucci died as a result of let another decade come to pass when break the fall of the cage. tons of compacted ore dust falling on him mine safety took a back seat to eco- We heard our colleague BOB WISE Thursday at Eveleth Mines’ Fairlane taco- nomics. talk about how dark it is in a mine. My nite pellet plant, the impact was felt by Mr. DURBIN. I thank my colleague. I father told me about the time when the thousands of miners across the Range. am sorry I had to cut him short, as we storm above ground cut the power, and It is never very far away. In the 1930’s have run out of time this evening in there they were, 600 feet underground, we had an average of 230 deaths a year this important special order. Perhaps he and a partner who had a heart con- from metal and nonmetallic mining. In we can resume it later on at a different dition, and all the light went out and the past 10 years, that has dropped to time. the water was trickling in. They 53 fatalities a year. But the danger is If you listened to the debate in Wash- switched on their head lamp, but there still there, and the significance of the ington over the last 6 months, you was no power, because the mining com- Mine and Safety Administration was would be convinced that all we are pany would not replace the batteries, brought up by testimony given by talking about tonight are faceless Fed- though the men appealed and asked for Peter Minsoni, district director of eral bureaucrats meddling into the af- them to be replaced. They knew they Steel Workers 33. fairs of business people, making their were weak, knew they were down, but I introduced him at a hearing of the life miserable with fines and inspec- the company said no, it costs too Committee on Education and Labor on tions and all sorts of minutiae that in much. And you could not move. You mine safety and health as the commit- fact weighs heavily on their profit could not see your hand in front of tee was preparing the legislation we statements. your face. And they waited for three know today as MSHA. I was a cospon- What I hope we have conveyed to- hours while the water crept up, waist sor of that original bill and helped night in this special order is we are high and armpit high. And, finally, draft it. Because when I came to the talking about something much larger. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6389 We are talking about dignity of work- b 2245 So this was our challenge, to try to ers. We are talking about safety in the And I said to the editorial boards, is deal with the entire budget. workplace. We are talking about a his- it not remarkable that you have a mi- Now, when people look at this and tory in America of danger in the work- nority party, the Republican Party, they say, what did we do? Domestic place that we do not want to see re- that has come forward with a plan that spending, we actually are cutting peated again. does not criticize President Clinton, spending. We are going to spend less The fact is since OSHA was created that does not criticize Democrats. It money next year in domestic spending. in 1970, we have seen deaths on the job simply outlines what we intend to do if That is what runs the judicial branch, in America cut in half. In factories we are fortunate enough to get elected. the legislative branch, the executive deaths on the job have been cut by This past week, the House and the branch, all the departments in the ex- more than half. In construction, deaths Senate have agreed to a plan that gets ecutive branch that are not defense. have been cut by 60 percent. Can OSHA us to a balanced budget. And the dif- And we are looking to actually have be improved? Yes, it can. But for those ferences between the House and the real cuts, absolute cuts there. Foreign who address this issue in terms of ter- Senate were not all that different. And aid, we are going to reduce the budget minating the Federal responsibility yet hearing in the press, you would significantly. Defense spending, we are and the Federal authority to help pro- have though that they were very dif- looking to hold the line. And the chal- tect workers and their families in the ferent. What we did is we made a deter- lenge there is that we are workplace, I would say they are really mination that in 7 years, we wanted to oversubscribed by $150 billion in the going in the wrong direction. slow the growth in spending so that it next 7 years, because what Congress I hope that the special order this would ultimately intersect our reve- has done, regretfully, is it has pushed evening, the stories that you have nues by the seventh year. And so that out the expenses of some of our pro- heard and I guess the information that by the time we were going to have rev- curement for our weapons systems and we have shared with you, will help peo- enues at $1.8 trillion, we would have not had it show up in our 5-year budget ple to understand that the debate our spending at $1.8 trillion. because they pushed it to the sixth which goes on on the floor of this The red line that you see on this year. So we are oversubscribed in our House of Representatives each day is a chart illustrates almost a parallel line defense spending. relevant and important debate to every between spending and revenue. They So what do we have to do? We have working family in America. We hope never meet because we always spend at to slow the growth of entitlements. We that those on the Republican side of deficits. So this was our objective, to have to make real and absolute cuts in the aisle who take an extreme position get our financial house in order and to our domestic spending, and we want to of doing away with this Federal respon- do it in 7 years. bring interest down. sibility will stop and think twice about The challenge in dealing with this ef- Now, people said, when you do that, the legacy of pain and the legacy of fort was that I, as a Member of Con- you are cutting certain programs that death which we have seen in America’s gress, along with my colleagues, vote we are not cutting. One of them was workplace, certainly something we on about one-third of the budget. We Medicaid. Medicaid is health care for never want to see repeated again. vote on the pink part of the diagram, the poor, and it is nursing care for the of this pie chart. We vote on what we elderly, long-term care for the elderly. f call domestic discretionary spending. This chart shows that we are actu- BALANCING THE BUDGET We vote on foreign aid. And we vote on ally going to be spending more money. defense spending through the Commit- In fact, subsequent to the agreement The SPEAKER pro tempore. Under tee on Appropriations. Social Security, with the Senate, we are going to be the Speaker’s announced policy of May Medicare, Medicaid, and what we call spending more than you see here. But 12, 1995, the gentleman from Connecti- entitlements, other entitlements, they it goes from $89 billion, in 1995, to $121 cut [Mr. SHAYS] is recognized for 60 just happen automatically. They are on billion. It increases over 30 percent in minutes as the designee of the major- automatic pilot. They do not get voted the next 7 years. We are going to be ity leader. on every year. They are just part of the spending more. That is not a cut; that Mr. SHAYS. I thank the Speaker for law. is an increase. giving me the opportunity to speak at So I do not vote on half of this budg- Now, the reason why some people call this special order and to thank him for et. I vote on one-third, what is in the it a cut is they say they want to spend his willingness to stay. I know the hour pink. And what is the yellow part is in- more and we are not spending to that is certainly a little late in the east terest on the national debt. This year level. We are going to be spending to part of the country. we are paying about $235 billion inter- $121 billion. How does that become a My purpose for speaking tonight is to est on the national debt. That is money cut in some people’s language? Be- talk about really a monumental event that could go for education or infra- cause, and this is only in Washington that is taking place this week when the structure, investment. It is going for that this happens, at least I do not House of Representatives and hopefully interest because past Congresses have know of it happening in people’s own the Senate will also be voting for the simply been willing to deficit spend. family environment or in their work first time in 24 years to get our finan- And the whole effort was to not only place, but in Washington, if it costs cial house in order and balance our just look at the red part of this budget, $100 million to run a program and peo- Federal budget deficits. what comes out of the Appropriations ple say, it will cost $105 million to run There is a revolution taking place in Committee, but it was to look at our the program the next year and Con- this country, and I do not think people entitlements, excluding Social Secu- gress appropriates $103 million, in fully grasp it. With the Contract With rity, because in our Contract With Washington that would be called a $2 America, I remember during the course America, we said the one thing that we million cut, even though we are spend- of the campaign I would have editorial would not change was Social Security, ing $3 million more. In your home and boards ask me how could I have signed the contract of retirement payments to in your workplace, you would be say- this Contract With America. And I re- our elderly. But we would look at Med- ing, if you spent $100 million and you sponded by asking a question. I said icare and Medicaid to save these pro- are spending $103 million, that is a $3 what do you think of the majority par- grams and preserve them and also to million increase in the next year. So ty’s Contract With America, the 8 slow their growth. We would look to we are going to be spending more on things they are going to do on the slow the growth of other entitlements. Medicaid. opening day of the session, the 10 We would look to actually have abso- In fact, under Medicaid, we are going things they are going to do in the first lute cuts in domestic spending and for- to spend over $324 billion more in the 100 days? And there was silence, be- eign aid and to not go higher on de- next 7 years than we did in the last 7. cause the majority party did not have fense spending than we are going This line shows the increase in spend- a plan in the opening day or it did not today. Then we hoped by doing that we ing that takes place under Medicaid. know what it wanted to do in the first would shrink what is the yellow and Only in Washington, when you spend 100 days. shrink our annual interest payments. $324 billion more in the next 7 years H 6390 CONGRESSIONAL RECORD — HOUSE June 27, 1995 than you did in the past 7 years would We are going to allow individuals to the House, it was $61,361. And I will il- some people call it a cut. It is not a join HMO’s. The bottom line is that, at lustrate in a new chart that that num- cut. It is an increase. It is an increase least from my perspective, we want ber is going up now that we have our that is quite substantive, quite signifi- seniors to be allowed to have the same agreement with the Senate. cant. health care that their children and These next two charts illustrate the Now, when it got to Medicare, we had their children’s children have. And we annual growth in spending that will heard the same argument that this want those who are poor or individuals take place if we do nothing. If we do Congress was going to be cutting Medi- on AFDC who get Medicaid, we want nothing, Social Security will go up at care. The first thing that needs to be them to basically have the same health 5.4 percent a year. If we do nothing, pointed out very strongly is that Medi- care that other Americans have. Medicare will go up at 10.1 percent a care is going to go bankrupt in 7 years, We want in some cases to have man- year and become bankrupt and run out Medicare part A. That is the part that aged care for those who want it. And in of funds in the seventh year. If we do goes to pay hospital costs. You have other cases, we want people to be able nothing, Medicaid is going to go up at Medicare part A, it is funded by tax- to have their own relationship with 10.8 percent and other entitlements at payers. They put a certain amount of their doctor, if they are a Medicare pa- 8.4 percent. Interest will go up nearly 6 all their income into the Medicare part tient and they choose to without percent. Defense spending will go up a A trust fund. Employers and employees breaking the law. We want Medicare percent a year. Foreign aid will go up put money in. If you are self-employed and Medicaid patients to examine their over 2 percent a year. Domestic discre- you have to put both sides in. And you bills and when they find mistakes, and tionary will go up 2.3 percent a year. put into this trust fund. there are mistakes, to get 10 percent of b 2300 This trust fund, as noted in the blue whatever they found in mistakes. line, starts to go down, it starts to go I happen to be the chairman of the There is if we do nothing. What we down next year. We have $136 billion in Subcommittee on Human Resources are looking to do, Mr. Speaker, is to the trust fund now. In 1966, next year, and Intergovernmental Relations of change the growth of these programs. it will be $135 billion. Then it goes to the Committee on Government Reform What happens, and Members can com- $129, $117, $98, $72, $37, minus $7 in the and Oversight, and we oversee HHS. We pare the chart at the bottom now to year 2002. It literally goes bankrupt. are aware of billings that were for the one at the top, we are going to There will be no money in the trust $16.50 that actually were $16,500. Or it allow Social Security to go up at 5.1 fund. The only money that will come is not unusual and it has happened that percent a year, Medicare is going to go to the trust fund is the annual amount it has actually been in the hundreds of up at 5.5 percent a year, not 10.1 per- that will be put in by the taxpayer. It thousands when it was only a bill for cent, Medicaid is going to go up 4.5 per- goes bankrupt, and we need to rescue $10 or $20. cent a year, not 10.7 percent. this fund. We need to save it. Spending Colossal mistakes. The State of Con- Other entitlements, which we have is that red line. And what we need to necticut has determined that their hos- made significant changes on, that is do is slow the growth of Medicare. pitals have mistakes in 30 percent of welfare, it is food stamps, it is agricul- Now, Medicare is health care for the their billings. tural subsidies, we are controlling the elderly and the disabled. And it is We want people to catch those mis- growth of these programs so they will growing at 10 percent. And we need to takes. They are going to save the Gov- go up at 3.9 percent a year. All of the preserve it. We need to protect it, and ernment a lot of money. They are entitlements are going to go up. They we need to save Medicare. The way we going to save the health care system a are simply not going to go up as much are going to save Medicare is not by lot of money, and we would like them as they would if we allowed or took no taxing more. That is just not going to to benefit. But Medicare part A is action. happen. We can affect the beneficiaries, going to go bankrupt if we do not slow Interest becomes quite significant. those who receive the benefits; we can the growth. Instead of it going up at nearly 6 per- affect the providers, those who are giv- So what do we propose? We propose cent a year, because of the budget ing services to the beneficiaries. Or we to allow Medicare to go up from $178 changes we are making, the total pay- can change the system. And just like billion to $259 billion. That is a 45-per- ment on interest will go up less than 1 with Medicaid, Medicare, we are going cent increase. Now, only in Washing- percent. to change the system. ton, when you spend 45 percent more in In this chart, defense spending is We are going to allow people to have the seventh year than you spend today going up a half a percent a year, but the same kind of program they have would some people call that a cut. That with the new agreement with the Sen- today with a slight increase for some, is a gigantic increase. It just does not ate, it will not go up basically at all not all. If you are wealthy, I for one am happen to be as large as some people during the next seven years. It will not going to be advocating that, if you want. decline, but it will not go up. Foreign make $90,000 as a married couple, you In terms of the total dollars, what we aid will go down 5.4 percent each year, should pay a little more on your pre- spent in the last 7 years to what we and domestic discretionary will go mium and your copayment. I will be spend today in the last 7 years, we down 1.6 percent a year. arguing that, if you were single and spent $925 billion. We are going to It is fair to say that Republicans are making $70,000, you should be paying spend $1.5 trillion. In fact now with the going to cut domestic spending. We are more than someone who is below that agreement with the Senate, it is going going to have not just real cuts, we are income level. to go up even more than that. We are going to have absolute cuts in those But there are other ways that we are going to spend $659 billion more over programs. Foreign aid will go down. going to change this program. We are the next 7 years compared to the last 7 Defense spending will stay basically going to strive to move people and en- years. Only in Washington, when you the same. Interest payments will go up courage them to go from a fee-for-serv- spend $659 billion more in the next 7 slightly, and then we have true growth ice into a whole host of different pri- years over the last 7 years do some call in Medicare and Medicaid and other en- vate plans that will provide a whole it a cut. It is not a cut. It is an increase titlements. host of different choices. For instance, in spending and a quite significant one. What I would like to do now, Mr. if you are a senior and you only want Some have said, you are going to Speaker, is just go through a number catastrophic care, you will be able to spend more on Medicare, but what is of charts, since the President has come join a plan and you will get an actual going to happen to the per beneficiary? in with his proposal on what we should rebate. You will get a refund. They are not going to get any more be- do to balance the budget. Before I talk We are going to allow people to have cause there are more beneficiaries in about what the President is actually a savings account that will be tax-free. the system. There are more people who doing, what Members see in this chart, You can use it for health care needs need the care. the green line is the Congressional tax-free. And if you do not have health What this chart illustrates is that in Budget Office. They are the ones that care needs, you will be able to save it 1995 we spent $48,000 per beneficiary in look at everything we do in Congress for your retirement. Medicare, and in the year 2002, under and make sure our numbers add up. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6391 The White House has its Office of Man- efficient, we are trying to reduce the the green line that touches zero in the agement and Budget. They do the same layers of bureaucracy within depart- seventh year. That is scored by CBO, thing. ments, where 11 people might have to and they point out, in fact, that we will Historically, the Congressional Budg- make a decision on what action gov- have a $1 billion surplus, not a lot of et Office and the Office of Management ernment should take, when in the pri- money compared to all those deficits, and Budget in the executive branch do vate sector they try to get it down to but what a change. Then what they did not always agree on their economic two, three, or four layers. is they analyzed the President’s new forecasts, but they have consistently, What did the Congressional Budget budget, and when they analyzed the the White House has consistently said Office say about the President’s 10-year President’s new budget, it is the red to us that we need, that we need to plan to balance the budget? Because line. Members will notice it is parallel. make sure that we use one group to Members may remember, a week or so It stays around $200 billion in deficits analyze our numbers. The organization ago the President said that we needed each year. that the White House has said we to balance our budget, not in 7 years, The President’s new budget goes should use is the Congressional Budget but in 10 years. In the process of doing from $175 billion to $196 billion to 212. Office. They are the ones who have said that, there were some Republicans who These are deficits. Then it goes to 199, ‘‘Use the Congressional Budget Office were critical of his effort, more Demo- to 213, to 220, to 211, 210, 207. It is just when you use your numbers.’’ That is crats who were critical, but a number above that $100 billion amount. It what we are doing. of Republicans welcomed the President never becomes balanced. When the All our projections are based on what stepping in and saying balancing the President said in the 10th year, scored the Congressional Budget Office says in budget was important. I happen to by the Office of Management and Budg- terms of their analysis of everything think we should be balancing the budg- et, yes, they say it becomes balanced, that we do in Congress. Regretfully, et in 5 years, not 7, so I certainly do but when we use the Congressional the Congressional Budget Office and not think 10 is good enough. Budget Office, the organization the the Office of Management and Budget However, what was important is that President told us all of us should use, are going in two different directions. the President recognized the need to it never becomes balanced. The Office of Management and Budg- balance the budget. He validated in Mr. Speaker, let me just show a few et has basically said, OMB, that reve- that process the fact that we can do it more charts. I noticed my colleague, nues will come in stronger than we with no tax increase. He validated the the gentleman from Michigan [PETE think they will in the Congressional fact that we are not cutting Medicare HOEKSTRA], has come to the Chamber. I Budget Office, and expenses will not be and Medicaid, we are slowing the would love to engage him in this dia- as strong. They said if we take no ac- growth. Those are his words, and those logue, because he is really one of the tion in the 7th year, the Office of Man- are our words. That is exactly what we key experts on this issue. agement and Budget, our deficit would are doing. He even validated the fact If I could just continue to go through be $266 billion. The Congressional that we can balanced the budget and these charts, I do not know if on the Budget Office said that if we take no have a tax cut at the same time, be- TV screen Members can see the dif- action, our deficit will be $454 billion. cause we are paying for the tax cut. ference between the two red lines and The next chart illustrates what hap- What did they say happens, the Con- the two green lines. The red lines are pens to the President’s own projections gressional Budget Office? There are the President’s budget and the green when the Congressional Budget Office four lines in this chart. The current lines are the House budget scored by looks at it. Members may remember law is, if we do nothing, the national OMB and scored by CBO, CBO being the that the President chose not to come debt, the annual deficit will be $454 bil- congressional budget. in with a budget to reduce our deficits. lion under current law. In the seventh When we compare the President’s He basically said ‘‘Congress, you do year, really the year 2002, and we are budget to the House budget, it is inter- it.’’ We are doing it. We are happy to using the 7-year budget, and we are esting to note that the President said do it. We have waited a long time to going to balance the budget in 7 years, ‘‘I am going to balance it in 7 years.’’ have this opportunity to lead this if we do nothing, our annual deficit That is the one with the red lines and country, so we said that we wanted to that year will be $340 billion. Mr. the dots. In the 10th year he says it is balance the budget in 7 years. The Speaker, a deficit is not the debt. The balanced. That is when his budget is President was critical of that effort, deficit is the difference between reve- scored by the Office of Management and basically said that we did not need nues, revenues and expenses, and when and Budget. It is balanced in 10 years. to be focused so much on reducing our you have expenses above revenues, you b annual deficits. have this deficit. 2310 I need to make this point, because it They are saying that this deficit will When the Congressional Budget Of- is central. Not only are we trying to be here, expenses will be here, revenues fice scores his budget, they say it never get our financial house in order, we are will be here, and we have $340 billion of becomes balanced. It is basically that trying to change this government. We deficit. At the end of the year it is parallel line to the zero deficits. are trying to change this social cor- taken and added on top of the national When the Congressional Budget Of- porate welfare mentality into an op- debt, and the national debt just keeps fice scores our budget, they say we are portunity society. We are trying to getting bigger and bigger and bigger. balanced in 7 years. But this is really, change this caretaking government Our national debt keeps going up every I think, an interesting point. into a caring government. year, even if our deficits get smaller, When the Office of Management and We are trying to change an experi- because our deficits keep adding to the Budget takes a look at our budget, ence that we are seeing throughout national debt. when they are forced to use their pro- this country of 12-year-olds having ba- They said under current law, the def- jection of revenues and expenses, they bies, of 14-year-olds selling drugs, of 15- icit will be $340 billion. They then said basically say, we will balance the budg- year-olds killing each other, of 18-year- under the President’s own plan in Feb- et now in 6 years and not 7. olds who cannot read their own diplo- ruary that the deficits keep going up. What the President has done is he mas, of 24-year-olds who have never, He did not give us a 7-year budget, he has compared his OMB scoring of 10 ever had a job, not necessarily because gave us a 5-year budget, but in the fifth years to our CBO scoring of 7. He has there are not any jobs, and 30-year-old year the deficit goes, in the fourth either got to compare his OMB to our grandparents. A society that exists year, 256, the fifth year 276. It just OMB or his CBO to our CBO. The bot- with that type of thing happening can- keeps going up. This is the reason why tom line is we are going to balance it not long endure. we 2 years ago opposed the President’s in 7 years under CBO and scored by his Therefore, we are not just trying to plan. We knew his annual deficits office, we balance it in 6 years. get our financial house in order, we are would keep going up and that he had I have 4 more charts. I will run trying to change our government in not resolved that. through them fairly quickly. the process. We are trying to make it Mr. Speaker, what we did is we came Medicaid Spending. The President smaller, we are trying to make it more in with a 7-year plan. Our 7-year plan is said he is only going to slow the H 6392 CONGRESSIONAL RECORD — HOUSE June 27, 1995 growth of Medicaid by $54 billion. That Then people said, well, moderate Re- gether to re-create and to renew this is the red line. He said, ‘‘But the House publicans would not get along with country. We ran on a positive agenda. Republicans are going to cut the conservative Republicans. This is what We then came in and, as my col- growth by $187 billion.’’ the press was saying. We got along just league recounted, we did what we said The problem is he is comparing OMB fine, thank you, because we have wait- we were going to do. We are continuing scoring of his budget to CBO. If we ed 40 years for the opportunity to help to do it. compare OMB to OMB, if he has $54 bil- lead this country and candidly to help I went back and got this document, lion of cuts in the growth, then we are save it. this is the CONGRESSIONAL RECORD for only $119 scored by OMB. But, more im- Then they said, ‘‘Well, you’re getting yesterday. It is pretty much a pro portantly, if we are slowing the growth along all right in the House but you’re forma day. But the first document that by $187 billion, we have to score his not going to get along with the Sen- was put in there was Permission to number $122 billion. He is not $54 bil- ate.’’ I happen to like the Senators. I Have until Midnight Tonight to file the lion scored by CBO. He is $122 billion. think a lot of my colleagues like the Conference Report on House Concur- In other words, we need to compare the Senators. We meet together and we rent Resolution 67, the Concurrent Res- same scoring. When you do that, you talk about this shared problem of how olution on the Budget for Fiscal Year realize that the President is cutting a we save this country. 1996. This is it. This is the document lot more from the growth in spending Then they said, ‘‘Well, you voted for that a year ago, 6 months ago, 6 weeks than he wishes to claim. the balanced budget amendment but ago, 6 days ago all the critics were say- The same analogy on Medicare. He you’re not going to vote to balance the ing we could not do, that first we could says he is going to slow the growth of budget.’’ We are voting to balance the not as House Members on the Commit- Medicare by $127 billion, scored by budget. In fact, I remember some say- tee on the Budget get to a budget reso- OMB. But when the Congressional ing, ‘‘You know, you boxed yourself in. lution that would balance the budget Budget Office scores what he does, they Now you’re going to have to do it.’’ within 7 years. Then they said, ‘‘Well, say he slows the growth by $192 billion. You know, in a way we did. In a way we yeah, you’re right, the House could do When you compare the $192 billion to did what Cortez did when he sailed to it but you’ll never get a similar-type our number of $288 billion, they are a the new world. He sailed to the new document out of the Senate.’’ The Sen- lot closer. world with this opportunity, as he saw ate came through in great form and In fact, when you consider the per- it, to claim this land for Spain and for they delivered a budget document that beneficiary, and this is before we had the old world, but what he did, he saw got the balance. our agreement with the Senate, the his sailors looking back to the east and As happens, their document was dif- per-beneficiary goes from, the Presi- longing to be back in the old world. So ferent than ours, and the people came dent, from $4,700 to over $7,000, and the he burned the ships. In a sense that is back and said, ‘‘Now there’s no way House, $4,800 to $6,300. you’ll ever reconcile the differences be- This chart, the last chart, illustrates what we have done as Republicans. tween the two.’’ We now have, and I be- the per-beneficiary cost of Medicare. There is no going back for us. We are lieve on Thursday we will have the op- Now with the House and Senate agree- not looking back at the old world. We ment, you will realize that the Presi- are looking at this new world. We have portunity, hopefully in both the House dent is slightly higher in per-bene- burned our ships. If we don’t get our fi- and the Senate, to pass a budget reso- ficiaries but not all that much. The nancial house in order, my feeling is we lution, the same budget resolution problem with the President is, in terms don’t deserve to come back. If we don’t which gets us to a balanced budget by of his plan, he attempts to slow the change this government, my sense is the year 2002. we don’t deserve to come back. growth of Medicare. He goes from $4,700 b 2320 to $7,128 in the seventh year. We in our I mean, that is what we are about. The old world is behind us, the new So we have moved from a process of House and Senate agreement go from talking about change, having a positive $4,800 to $6,667. We are less than $400 world is in front of us. I appreciate the message, to taking one more step to apart. patience of my colleague. I would love actually delivering positive change, The difference is we want to change at this time to invite him to make the system. We want to save Medicare, some comments, because I know you and as we have had so many people we want to preserve it, but we want to have been at the very center of what I come into the Budget Committee and change it. We want people to have the have been talking about. testify, Alan Greenspan coming in and opportunity to have a whole host of Mr. HOEKSTRA. I thank my col- talking about what the importance is different plans, whereas the President league for yielding. of having a balanced budget, not only has not said how he will slow the Mr. Speaker, I could not help but to business and industry, but to fami- growth of Medicare. watch this special order when the gen- lies, people buying a mortgage. I be- There are extraordinary things tak- tleman started about 30 minutes ago, lieve a number Mr. Greenspan has ing place down here. I do not think and remembering my commitment quoted is we may see up to a 2-percent people fully grasp it. There is a revolu- that I would come down and join if he benefit on home mortgage and long- tion going on. I will conclude, and I started before 11:00. term interest rates and short-term in- would like to invite my colleague to Mr. SHAYS. But I kept you waiting a terest rates. add some comments. I will conclude by long time, did I not? Mr. SHAYS. I would love the gen- making this comment: Mr. HOEKSTRA. That is fine. tleman to yield to me, because I re- When we had our Contract With I think the words that you started member when we were there, when Mr. America, which my colleague, the gen- your special order with were talking Greenspan was before the Budget Com- tleman from Michigan [Mr. HOEKSTRA], about the discussions that we really mittee and one of our colleagues said, helped lead and helped create, created had 14, 15 months ago, talking about ‘‘Are you not concerned that Congress the idea, created the Capitol steps what kind of an agenda and what kind will cut too much?’’ He responded in event and had a lot to do with what of platform are we going to run on as the way that only he does. He said, went in our contract, as my colleague Republicans, in walking away from the ‘‘You know, Mr. Congressman, I do not knows, before the election, people said, easy answer which is saying, let’s run a go to sleep at night fearful that when I well, this would cost Republican votes. negative campaign, and talking about wake up Congress will have cut too We did not lose one Republican who now, let’s not worry about what the much.’’ ran who was an incumbent and we other side is doing, what the other side Mr. HOEKSTRA. I do not think that picked up a whole new number that is saying, let’s identify our agenda, has been a problem. The nice thing gave us a majority. what we want to do, the positive mes- about going through this process is we Then people said, well, this was a sage that we believe we can carry to have recognized, despite all of the rhet- contract but you used it to get elected the American people because of the oric, and Mr. Greenspan knew this, to but you wouldn’t implement it. We im- great faith that we have in our coun- get a balanced budget we did not have plemented it in the first day and then try, in the American people, in our to radically go through and cut spend- the first 100 days. ability to bring all of these people to- ing; we had to slow the growth of the June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6393 Federal Government. And coming from cial house in order. As the gentleman in school lunch, it is too risky, we the private sector, I would have taken pointed out, we are still going to allow want to make sure that these kids are these kinds of budgets and these kinds spending to go up, we are just going to fed. We are going to give them a 41⁄2 of cuts almost any time because the slow the growth. percent increase for each of the next 5 private sector is going through much I do not know if the gentleman has years. So we thought fine, we have got- more difficult and aggressive cost-cut- thought much about the challenge we ten rid of the red tape, the rules and ting procedures than what we are had when we had the debate on the regulations, the bureaucracy. They are doing. We are slowing the growth. We school lunch program and the incred- getting more money. This cannot be are still spending at a roughly 3-per- ible feeling I had when I went home one controversial. cent to 4-percent increase. weekend and I saw the President in a Mr. SHAYS. It is a win-win, right? Mr. SHAYS. About a 3-percent in- school saying we were eliminating the Mr. HOEKSTRA. It is win-win. All of crease. In fact when we looked at what school lunch program, apropos of your a sudden we come to the floor and we we are spending now we spend about whole issue of whether we are spending see people on TV, and it is the sky is $1.5 trillion. In the seventh year it will more. I thought, what idiots. falling, and you know, this is my sec- be $1.8 trillion. That is an increase in Why would this Congress be doing ond term, so this is my third year here, spending by anybody’s definition. this. I remember coming back and say- and you are kind of looking around and Mr. HOEKSTRA. That is right; and ing how could you of all things cut the saying, ‘‘Whoa, what’s happening to us as we have taken a look we are increas- school lunch program. And speaking to here, we are giving them more money, ing spending, we are going to have to the appropriators, they said wait a sec- we have gotten rid of this, and there reassess some priorities, because we ond, we are taking it off as an entitle- are people that are going out and say- are going to be moving money into ment. We are going to spend 4.5 percent ing we are eliminating the program.’’ high-priority programs, programs like more each year for the next 5 years, 4.5 Then you take a look at it and you say, Medicare, Medicaid, those types of pro- percent more each year instead of 5.2 ‘‘There are even people printing this as grams, as we reform them we are still percent. Then they said, but we are fact.’’ It has taken a while, but there going to be increasing this per bene- going to also allow State and local gov- are other ways to get information out, ficiary from I do not know of the latest ernments to be more flexible with how and the truth eventually comes out, numbers, but I know in the House they use it so they can target the funds and the truth has come out on that budget resolution we are looking at better. I can remember the President program. going from roughly $4,700 or $4,800 per saying we are going to eliminate school Mr. SHAYS. Basically it was an ex- beneficiary to over $6,000 per bene- lunch for poor kids. Then I thought of cellent opportunity for all of us to ficiary. my daughter, if I can just make this learn a lesson, and we talk about not Mr. SHAYS. Actually with the Sen- last point, I thought of my daughter being school-lunched again on other is- ate agreement, it is going to be about who comes from a family who obvi- sues. It is the same way with Medicaid $6,600. ously makes a decent amount of in- and Medicare. We are going to be Mr. HOEKSTRA. So we are signifi- come, and I realized that my daugh- spending more money and we are going cantly going to grow. We are expecting ter’s lunch is subsidized, 17 cents in to make sure that we are not being that we are going to have reform, so we cash and 13 cents in commodity. Why school-lunched on these two programs, are going to be able to deliver the same would my daughter’s school lunch be that people truly understand what is if not better health care to our seniors subsidized? Because we have a Federal happening. than what we are getting today. program that subsidizes everyone. Mr. HOEKSTRA. I know that as I So we have an opportunity to go Mr. HOEKSTRA. I am well aware of went back for a whole series of town through programs, yes, we are going to what went on with school lunch. It meetings in April when the school have to downsize and eliminate some came out of the Committee on Eco- lunch debate was at its peak, you kind programs. We are going to have an op- nomic and Educational Opportunities. of go back and say, ‘‘Wow, I am really portunity to go after waste, fraud and Mr. SHAYS. The gentleman’s com- going to be prepared to address the abuse more aggressively, but as we mittee. issue, because I am going to get a lot of take those savings some of those will Mr. HOEKSTRA. My committee. I questions on it.’’ It was very surpris- go toward deficit reduction, others of can only say I think our committee let ing, because even as I think much of those dollars will go towards programs our colleagues on the Republican side the media had not covered the debate we have identified as having a high pri- of the aisle down, because when we very accurately, it came up, and people ority, and we are still going to be get- went through this, we had discussions understood the issue, and they under- ting increased revenue. So we are going about where are we taking the school stood it a lot better than what I to be spending more money in 7 years lunch program. We said, No. 1, we are thought they might. They had gone than what we are today, and all we going to reform it, we are going to take through the clutter and taken a look have to do is now manage ourselves the program from Washington and we at what was really going on. The gen- and discipline ourselves over the next 7 are going to move the program to the tleman brought up his daughter. I had years and we will get to a place where States and the local school districts, so people actually coming to me and say- we wanted to be for a long period of we are going to get Washington out of ing, ‘‘Can you explain to me exactly time. the way and out of this program. Why why the Federal Government is even Mr. SHAYS. I was elected to the are people in Washington monitoring doing a school lunch program?’’ We State House in Connecticut in 1974, and what kids are eating in Holland, MI, or have moved a significant distance away started by first year in 1975, and I con- Zeeland, MI, or anywhere in the coun- from, ‘‘Whoa, you are cutting these tinually watched Congress deficit try. It is a bureaucracy that does not programs out.’’ spend, and in the State House I was not need to be there. But the gentleman is absolutely allowed to do that, thank goodness; we So let us get rid of the bureaucracy, right. We are going to spend a lot of always had to have a balanced budget. which will do a couple of things. It will time over the next 6 months because And when I was elected 7 or 8 years free up more money for buying food the process now is the authorization ago, and as the gentleman was elected and actually getting food to kids, and bills, the appropriations bills, that put shortly after that, I mean we weighed very different from all of the other a real life into this budget document. in and said the most important thing block grants, this is one where we then obviously before we do all of the other went through and we said OK, we are b 2330 things is to get our financial house in going to increase spending. Other block Because those are the bills that now order. So I cannot emphasize how grants, Governors have come back to actually carry out the budget docu- thrilling this week is for me. It is one us and said if you get rid of all of the ment. Those are the ones that change reason why I wanted this special order. rules and regulations, all of the red our policies. They change our prior- I basically waited 20 years for this op- tape, we can deliver the same level of ities. They focus dollars where we want portunity, and now you and I are able service at 90 percent of the dollars, 95 them focused. They change the way to be part of an effort to get our finan- percent of the dollars, and we said well that we actually start doing business. H 6394 CONGRESSIONAL RECORD — HOUSE June 27, 1995

And I think as you said earlier, they ernor. Governor Engler has made a lot Mr. CAMP (at the request of Mr. start changing the way that America of exciting reforms and the reforms are ARMEY) for today, on account of the works so that we can use these dollars coming from states like Michigan birth of his son, Andrew David Camp. in a much more constructive way. where you have seen welfare reform f We have recognized the problems and other reforms that the Federal that ineffective Washington spending Government has been reluctant to SPECIAL ORDERS GRANTED has reaped on this country. The symp- take. By unanimous consent, permission to toms are here in Washington. They are Mr. HOEKSTRA. Yes, the next 5 or 6 address the House, following the legis- around in our urban centers around the months will be tough. We have a lot of lative program and any special orders country. They are in our smaller com- work to do, even though we now have a heretofore entered, was granted to: munities, our rural communities. budget document. There are issues that (The following Members (at the re- We are going to go after those prob- you and I will disagree on. quest of Mr. FARR) to revise and extend lems and we are going to move ac- I think the exciting thing about the their remarks and include extraneous countability and responsibility to process that we have gone through in material:) where change can be affected most effi- the last 6 months, and that we look for- Mr. FARR, for 5 minutes, today. ciently and most quickly, which is at ward to in the next 6 months, is that Ms. JACKSON-LEE, for 5 minutes, the local level. we have a large group of Members who today. Mr. SHAYS. You know, during the do have their sights on the same vi- Mr. DEFAZIO, for 5 minutes, today. course of your last comments, you sion: Creating a better America; under- Ms. KAPTUR, for 5 minutes, today. pointed out that our budget resolution, standing the things that we need to do (The following Members (at the re- which is really a plan and an agree- to get there; understanding the many quest of Ms. ROS-LEHTINEN) to revise ment between the House and the Sen- different strategies. Differing on some and extend their remarks and include ate on how we are going to reach a new of the projects, but recognizing that an extraneous material:) deficit by the seventh year, has to be ability to dialogue, an ability to work Mr. FUNDERBURK, for 5 minutes each implemented by the Appropriations together in a partnership, both on this day, on June 29 and June 30. Committee that will make decisions on side of the aisle, across the aisle, to the Ms. SEASTRAND, for 5 minutes, on defense spending and domestic spend- Senate, hopefully to the President, June 28. ing; will have to be implemented by the back to grassroots America. That Mr. FOLEY, for 5 minutes, today. Ways and Means Committee that through that dialogue and through Mr. GOSS, for 5 minutes each day, makes decisions on taxes; Ways and that partnership, and only through today and on June 28. Means and Energy Committee making that dialogue and only through that Mr. RIGGS, for 5 minutes each day, decisions on entitlements. So all of this, we are going to be partnership, will we reach the type of today and on June 28, 29, and 30. doing a lot of wrestling in the next solutions that get us to our objective Mr. HOKE, for 5 minutes, today. Mr. KINGSTON, for 5 minutes each three or four months. And the key and get us there in a very positive and point as far as I am concerned is that constructive way. day, today and on June 28, 29, and 30. So we are going to have to work Mr. CHAMBLISS, for 5 minutes each the President needs to weigh in in a positive way. And I have made a deter- through lots of differences on projects, day, today and on June 28, 29, and 30. Mr. DORNAN, for 5 minutes each day, mination, with a number of my col- but we recognize that we have to work leagues, that I am not voting to in- through those differences. We have to today and on June 28. crease the Federal debt ceiling. If the reach agreement. And that as we reach f agreement, we, together, will reach the President is not going to weigh in on EXTENSION OF REMARKS getting this budget balanced, our fi- goals and the missions that we have nancial House in order, too often we outlined. By unanimous consent, permission to have allowed the debt ceiling to climb, So I think it is going to be a tough 5 revise and extend remarks was granted we are willing to shut down govern- or 6 months. It is going to be a very to: ment. satisfying 5 or 6 months, because at the (The following Members (at the re- Not essential services, but we are end we will have made a difference. We quest of Mr. FARR) and to include ex- simply willing to shut down the gov- have been working at it for a long pe- traneous matter:) ernment and call the question. And I riod of time. And we are going to take Mr. MILLER. wish it had happened 10 years ago. If it some gigantic steps in 1995 and then we Mr. UNDERWOOD. had happened 10 years ago, we would have 6 more years of work to do to Mr. HOYER. not be in the mess we are in today. make sure that we get to that zero, be- Mr. MARKEY. But as you point out, a lot of what cause we have to stay disciplined for Mr. BEILENSON. we intend to do is to move this govern- that time. Mr. BERMAN in two instances. ment from the Federal to the State and I thank the gentleman for sharing Ms. SLAUGHTER. local level. And as I think about it, and this time with me. Mrs. SCHROEDER. I have to admit that I did not use to Mr. SHAYS. I thank the gentleman. I Mr. NADLER. think this way. I used to think if peo- agree so strongly with the gentlemen Mr. GORDON. ple had different shoe sizes, the Federal words, I would like them to be what is Mr. BARCIA. Government would make sure that ev- the last words and I yield back my Mr. MORAN. erybody had the right shoe size. time. Mr. HAMILTON. Instead, Washington tries to make f Mr. ENGEL. one size fit all. So if people have a size Mr. FILNER. 3, or some 18 or 16 or 15 or 10, they cre- LEAVE OF ABSENCE Mr. TUCKER in two instances. ate and we create the shoes in the size By unanimous consent, leave of ab- Ms. MCCARTHY. of 9 and say: Everybody has got to wear sence was granted to: Mr. TOWNS. them. Mr. YATES (at the request of Mr. GEP- (The following Members (at the re- I would prefer Mississippi to have a HARDT) for today, on account of illness. quest of Ms. ROS-LEHTINEN) and to in- system that fits them; Michigan to Miss COLLINS of Michigan (at the re- clude extraneous matter:) have a system that fits them; and for quest of Mr. GEPHARDT) on Tuesday Mr. HUNTER. us in Connecticut to have a system and Wednesday, June 27 and 28, on ac- Mr. FRANKS of New Jersey. that fits our needs and our concerns. count of illness. Mr. RADANOVICH. Mr. HOEKSTRA. I think of much of Mr. MFUME (at the request of Mr. Mr. EHRLICH. what we do in Michigan would work in GEPHARDT) for today, on account of Mr. FORBES. Connecticut. We will export our solu- travel delays. Mr. BLILEY. tions over to you. Mr. GUNDERSON (at the request of Mr. Mr. MARTINI. Mr. SHAYS. I will jump in, because ARMEY) for today, on account of family Mr. YOUNG of Alaska. that is what you do with your gov- illness. Mr. TAYLOR. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6395

Mr. HYDE. monthly report on progress toward a nego- period ending March 31, 1995 pursuant to Mr. SHUSTER. tiated settlement of the Cyprus question, in- Public Law 101–576, section 305 (104 Stat. Mr. STUMP. cluding any relevant reports from the Sec- 2853); to the Committee on Government Re- Mr. BURTON of Indiana. retary General of the United Nations, pursu- form and Oversight. ant to 22 U.S.C. 2373(c); to the Committee on Mr. JONES. 1103. A letter from the Secretary, Depart- International Relations. ment of Transportation, transmitting the Mr. GILLMOR in two instances. 1091. A letter from the Secretary, Depart- Secretary’s management report on manage- Mr. QUINN. ment of Housing and Urban Development, ment decisions and final actions on Office of Mr. HOKE. transmitting the inspector general’s semi- Inspector General audit recommendations, Mr. LAZIO of New York. annual report for the period October 1, 1994, for the period ending March 31, 1995, pursu- Mr. SOLOMON in two instances. through March 31, 1995, pursuant to 5 U.S.C. ant to Public Law 101–576, section 306(a) (104 f app. (Insp. Gen. Act) section 5(b); to the Stat. 2854); to the Committee on Government Committee on Government Reform and Reform and Oversight. ADJOURNMENT Oversight. 1104. A letter from the Administrator, Gen- 1092. A letter from the Chairman, Council eral Services Administration, transmitting Mr. SHAYS. Mr. Speaker, I move of the District of Columbia, transmitting a that the House do now adjourn. the 1993–1994 report to Congress on programs copy of D.C. Act 11–67, ‘‘Pennsylvania Ave- for the utilization and donation of Federal The motion was agreed to; accord- nue Development Area Parks and Plaza Pub- personal property, pursuant to Public Law ingly (at 11 o’clock and 36 minutes lic Safety Temporary Amendment Act of 101–612, section 5 (102 Stat. 3181); to the Com- p.m.), the House adjourned until to- 1995,’’ pursuant to D.C. Code, section 1– mittee on Government Reform and Over- morrow, June 28, 1995, at 10 a.m. 233(c)(1); to the Committee on Government sight. Reform and Oversight. 1105. A letter from the Chairman, U.S. f 1093. A letter from the Chairman, Council Equal Opportunity Commission, transmit- of the District of Columbia, transmitting a EXECUTIVE COMMUNICATIONS, ting the semiannual report on activities of copy of D.C. Act 11–68, ‘‘Prohibition on the the inspector general for the period March ETC. Transfer of Firearms Temporary Act of 31, 1995, and the management report for the 1995,’’ pursuant to D.C. Code, section 1– Under clause 2 of rule XXIV, execu- same period, pursuant to 5 U.S.C. app. (Insp. 233(c)(1); to the Committee on Government tive communications were taken from Gen. Act) section 5(b); to the Committee on Reform and Oversight. the Speaker’s table and referred as fol- Government Reform and Oversight. lows: 1094. A letter from the Chairman, Council of the District of Columbia, transmitting a 1106. A letter from the Secretary of the In- 1082. A letter from the General Counsel, copy of D.C. Act 11–69, ‘‘Insurance Omnibus terior, transmitting the annual report enti- Department of Defense, transmitting a draft Temporary Amendment Act of 1995,’’ pursu- tled ‘‘Outer Continental Shelf Lease Sales’’ of proposed legislation to clarify an ambigu- ant to D.C. Code, section 1–233(c)(1); to the for fiscal year 1994, pursuant to 43 U.S.C. ity relating to the applicability of section Committee on Government Reform and 1337(a)(9); to the Committee on Resources. 3703a of title 46, United States Code, to ves- Oversight. 1107. A letter from the Secretary of Veter- sels in the National Defense Reserve Fleet; 1095. A letter from the Chairman, Council ans Affairs, transmitting a draft of proposed to the Committee on National Security. of the District of Columbia, transmitting a legislation to permit the Secretary of Veter- 1083. A letter from the Acting Director, Of- copy of D.C. Act 11–70, ‘‘Industrial Revenue ans Affairs to reorganize the Veterans fice of Thrift Supervision, transmitting a re- Bond Forward Commitment Program Au- Health Administration notwithstanding the port on changes and progress in the oper- thorization Temporary Act of 1995,’’ pursu- notice and wait requirements of section 510 ations involving regulatory resources for the ant to D.C. Code, section 1–233(c)(1); to the of title 38, United States Code, and to amend Office, pursuant to 12 U.S.C. 1462a(g); to the Committee on Government Reform and title 38, United States Code, to facilitate the Committee on Banking and Financial Serv- Oversight. reorganization of the headquarters of the ices. 1096. A letter from the Chairman, Council Veterans Health Administration; to the 1084. A letter from the Acting Director, Of- of the District of Columbia, transmitting a Committee on Veterans’ Affairs. fice of Thrift Supervision, transmitting the copy of D.C. Act 11–71, ‘‘Limited Liability 1108. A letter from the Deputy Adminis- Office’s 1994 annual report to Congress on Company Amendment Act of 1995,’’ pursuant trator, General Services Administration, implementation of the Community Reinvest- to D.C. Code, section 1–233(c)(1); to the Com- transmitting an informational copy of the ment Act, pursuant to 12 U.S.C. 2904; to the mittee on Government Reform and Over- space situation report for the National Oce- Committee on Banking and Financial Serv- sight. anic and Atmospheric Administration con- ices. 1097. A letter from the Chairman, Council solidation for Hampton Roads, VA, pursuant 1085. A letter from the Secretary of En- of the District of Columbia, transmitting a to 40 U.S.C. 606(a); jointly, to the Commit- ergy, transmitting the Department’s report copy of D.C. Act 11–72, ‘‘Business Corporation tees on Appropriations and Transportation entitled, ‘‘Energy Efficient Environmental Five-Year Report Amendment Act of 1995,’’ and Infrastructure. Program for Pollution Prevention in Indus- pursuant to D.C. Code, section 1–233(c)(1); to 1109. A letter from the Acting Assistant try,’’ pursuant to Public Law 102–486, section the Committee on Government Reform and Attorney General, transmitting the Attor- 2108(c) (106 Stat. 3071); to the Committee on Oversight. ney General’s report on risk exposure of pri- Commerce. 1098. A letter from the Chairman, Council vate entities covered by the Federally Sup- 1086. A letter from the Director, Defense of the District of Columbia, transmitting a ported Health Centers Assistance Act of 1992; Security Assistance Agency, transmitting copy of D.C. Act 11–73, ‘‘Public Accountancy jointly, to the Committees on the Judiciary the Department of the Army’s proposed lease Amendment Act of 1995,’’ pursuant to D.C. and Commerce. of defense articles to Brazil (Transmittal No. Code, section 1–233 (c)(1); to the Committee 1110. A letter from the Railroad Retire- 21–95) pursuant to 22 U.S.C. 2796a(a); to the on Government Reform and Oversight. ment Board, transmitting a report on the ac- Committee on International Relations. 1099. A letter from the Chairman, Council tuarial status of the railroad retirement sys- 1087. A letter from the Director, Defense of the District of Columbia, transmitting a tem, including any recommendations for fi- Security Assistance Agency, transmitting copy of D.C. Act 11–74, ‘‘Commercial Piracy nancing changes, pursuant to 45 U.S.C. 321f– the Department of the Navy’s proposed lease Protection and Deceptive Labeling Amend- 1; jointly, to the Committees on Transpor- of defense articles to Brazil (Transmittal No. ment Act of 1995,’’ pursuant to D.C. Code, tation and Infrastructure and Ways and 22–95), pursuant to 22 U.S.C. 2796a(a); to the section 1–233(c)(1); to the Committee on Gov- Means. Committee on International Relations. ernment Reform and Oversight. 1111. A letter from the Secretary of Labor, 1088. A letter from the Director, Defense 1100. A letter from the Chairman, Council transmitting the Department’s report enti- Security Assistance Agency, transmitting of the District of Columbia, transmitting a tled, ‘‘Transition Assistance Program: Phase the Department of the Air Force’s proposed copy of D.C. Act 11–76, ‘‘Isle of Patmos Plaza III Impact Analysis,’’ pursuant to Public lease of defense articles to Brazil (Transmit- Designation Act of 1995,’’ pursuant to D.C. Law 101–237, section 408(d) (103 Stat. 2084); tal No. 24–95), pursuant to 22 U.S.C. 2796a(a); Code, section 1–233(c)(1); to the Committee jointly, to the Committees on National Secu- to the Committee on International Rela- on Government Reform and Oversight. rity, Economic and Educational Opportuni- tions. 1101. A letter from the Chairman, Council ties, and Veterans’ Affairs. 1089. A letter from the Assistant Secretary of the District of Columbia, transmitting a for Legislative Affairs, Department of State, copy of D.C. Act 11–77, ‘‘Nonprofit Corpora- f transmitting a copy of a memorandum of tion Five-Year Report Amendment Act of justification for drawdown under section 552 1995,’’ pursuant to D.C. Code, section 1– REPORTS OF COMMITTEES ON of the Foreign Assistance Act to support the 233(c)91); to the Committee on Government PUBLIC BILLS AND RESOLUTIONS Haitian police forces, pursuant to 22 U.S.C. Reform and Oversight. 2348a; to the Committee on International Re- 1102. A letter from the Inspector General, Under clause 2 of rule XIII, reports of lations. General Services Administration, transmit- committees were delivered to the Clerk 1090. A communication from the President ting the office’s audit report register, includ- for printing and reference to the proper of the United States, transmitting the bi- ing all financial recommendations, for the calendar, as follows: H 6396 CONGRESSIONAL RECORD — HOUSE June 27, 1995 Mr. ARCHER: Committee on Ways and providing wiretap and asset forfeiture au- in the jurisdiction of the committee con- Means. H.R. 541. A bill to reauthorize the At- thority to combat alien smuggling and relat- cerned. lantic Tunas Convention Act of 1975, and for ed crimes, increasing penalties for bringing By Mr. SOLOMON: other purposes; with amendments (Rept. 104– aliens unlawfully into the United States, and H.R. 1938. A bill to amend the vaccine in- 109, Pt. 2). Referred to the Committee of the making certain miscellaneous and technical jury compensation portion of the Public Whole House on the State of the Union. amendments, and for other purposes; to the Health Service Act to permit a petition for Mr. ARCHER: Committee on Ways and Committee on the Judiciary. compensation to be submitted within 48 Means. H.R. 1642. A bill to extend non- By Mr. ENGEL (for himself, Mr. months of the first symptoms of injury; to discriminatory treatment—most-favored-na- SAXTON, Mr. SCHUMER, and Mr. the Committee on Commerce. tion treatment—to the products of Cam- DELAY): By Mr. UNDERWOOD (for himself and bodia, and for other purposes (Rept. 104–160). H.R. 1930. A bill to govern relations be- Mr. FRAZER): Referred to the Committee of the Whole tween the United States and the Palestine H.R. 1939. A bill to amend the Federal House on the State of the Union. Liberation Organization [PLO], to enforce Home Loan Bank Act to provide for the rep- Mr. ARCHER: Committee on Ways and PLO compliance with standards of inter- resentation of Guam and the Virgin Islands Means. H.R. 1887. A bill to authorize appro- national conduct, and for other purposes; to on the boards of directors of the appropriate priations for fiscal years 1996 and 1997 for the the Committee on International Relations, Federal home loan banks; to the Committee International Trade Commission, the Cus- and in addition to the Committee on Bank- on Banking and Financial Services. toms Service, and the Office of the U.S. ing and Financial Services, for a period to be By Mr. YOUNG of Alaska: Trade Representative, and for other pur- subsequently determined by the Speaker, in H.R. 1940. A bill to amend the Internal Rev- poses; with amendments (Rept. 104–161). Re- each case for consideration of such provi- enue Code of 1986 to allow a charitable con- ferred to the Committee of the Whole House sions as fall within the jurisdiction of the tribution deduction for certain expenses in- on the State of the Union. committee concerned. curred by whaling captains in support of Na- Mr. ARCHER: Committee on Ways and By Mr. GILLMOR: tive Alaskan subsistence whaling; to the Means. H.R. 1643. A bill to authorize the ex- H.R. 1931. A bill to amend the Legal Serv- Committee on Ways and Means. tension of nondiscriminatory treatment— ices Corporation Act to prohibit recipients of By Mr. OWENS: most-favored-nation treatment—to the prod- grants or contracts from the Legal Services H.J. Res. 98. Joint resolution proposing an ucts of Bulgaria (Rept. 104–162). Referred to Corporation from soliciting clients, and for amendment to the Constitution of the Unit- the Committee of the Whole House on the other purposes; to the Committee on the Ju- ed States to clarify the meaning of the sec- State of the Union. diciary. ond amendment; to the Committee on the Mr. GOODLING: Committee on Economic By Mr. HOEKSTRA (for himself, Mr. Judiciary. and Educational Opportunities. H.R. 1176. A COBURN, Mr. WELDON of Florida, Mr. By Mr. SANDERS (for himself, Mr. bill to nullify an Executive order that pro- VOLKMER, Mr. LAFALCE, and Mr. DEFAZIO, and Mr. MILLER of Califor- hibits Federal contracts with companies that CANADY): nia): hire permanent replacements for striking H.R. 1932. A bill to amend the Public H. Con. Res. 79. Concurrent resolution ex- employees (Rept. 104–163). Referred to the Health Service Act to prohibit governmental pressing the sense of Congress regarding an Committee of the Whole House on the State discrimination in the training and licensing appropriate minimum length of stay for rou- of the Union. of health professionals on the basis of the re- tine deliveries; to the Committee on Com- Mr. SOLOMON: Committee on Rules. fusal to undergo or provide training in the merce. House Resolution 173. Resolution providing performance of induced abortions, and for By Mr. MARKEY (for himself and Mr. for consideration of the joint resolution (H.J. other purposes; to the Committee on Com- LEACH): Res. 79) proposing an amendment to the Con- merce. H. Res. 174. Resolution expressing the sense stitution of the United States authorizing Mrs. KENNELLY (for herself, Ms. of the House of Representatives regarding the Congress and the States to prohibit the DELAURO, Mr. GEJDENSON, Mr. SHAYS, the recent announcement by the Republic of physical desecration of the flag of the United Mrs. JOHNSON of Connecticut, Mr. France that it intends to conduct a series of States (Rept. 104–164). Referred to the House FRANKS of Connecticut): underground nuclear test explosions despite Calendar. H.R. 1933. A bill to require the Secretary of the current international moratorium on nu- the Treasury to mint coins in commemora- clear testing; to the Committee on Inter- f tion of the bicentennial of the Old State national Relations. House of Connecticut; to the Committee on f PUBLIC BILLS AND RESOLUTIONS Banking and Financial Services. Under clause 5 of rule X and clause 4 By Mr. LAZIO of New York: MEMORIALS of rule XXII, public bills and resolu- H.R. 1934. A bill to amend section 255 of the National Housing Act to extend the mort- Under clause 4 of rule XXII, memori- tions were introduced and severally re- als were presented and referred as fol- ferred as follows: gage insurance program for home equity con- version mortgages for elderly homeowners, lows: By Mr. THORNTON: and for other purposes; to the Committee on 122. By the SPEAKER: Memorial of the H.R. 1926. A bill to provide for the protec- Banking and Financial Services. Senate of the State of Louisiana, relative to tion of the flag of the United States; to the By Mr. LIPINSKI: memorializing the Congress of the United Committee on the Judiciary. H.R. 1935. A bill to suspend until January States to establish an integrated spent fuel By Mr. LIVINGSTON: 1, 1998, the duty on certain twine; to the management storage facility; to the Com- H.R. 1927. A bill making emergency supple- Committee on Ways and Means. mittee on Commerce. mental appropriations for additional disaster By Mr. MILLER of California (for him- 123. Also, memorial of the Senate of the assistance, for antiterrorism initiatives, for self, Mr. DEFAZIO, Mr. WAXMAN, Mr. State of Louisiana, relative to memorializ- assistance in the recovery from the tragedy SANDERS, Mr. MCDERMOTT, Mr. ACK- ing the Congress of the United States to that occurred at Oklahoma City, and making ERMAN, Mrs. MINK of Hawaii, Mr. cause the Army Corps of Engineers to miti- rescissions for the fiscal year ending Sep- SCOTT, Mr. TORRICELLI, Mr. DELLUMS, gate for losses on the MR&T Mainline Levee tember 30, 1995, and for other purposes; to Mr. FLAKE, Ms. WOOLSEY, Mrs. Construction Program and perform an up- the Committee on Appropriations, and in ad- SCHROEDER, Ms. DELAURO, Mr. dated environmental impact statement; to dition to the Committee on the Budget, for a OWENS, Mr. STARK, Mr. EVANS, Mr. the Committee on Transportation and Infra- period to be subsequently determined by the FRAZER, Mr. BORSKI, Mr. NADLER, and structure. Speaker, in each case for consideration of Mr. SERRANO): f such provisions as fall within the jurisdic- H.R. 1936. A bill to amend title 5, United tion of the committee concerned. States Code, to provide for certain minimum ADDITIONAL SPONSORS By Mr. BEILENSON: requirements under the Federal Employees H.R. 1928. A bill to amend title 49, United Health Benefits Program with respect to ob- Under clause 4 of rule XXII, sponsors States Code, to require that the motor vehi- stetrical benefits; to the Committee on Gov- were added to public bills and resolu- cle bumper standard established by the Sec- ernment Reform and Oversight. tions as follows: retary of Transportation shall be restored to By Mr. SCHIFF: H.R. 32: Mr. KLECZKA. that in effect January 1, 1982; to the Com- H.R. 1937. A bill to facilitate small business H.R. 65: Mr. EVANS, MR. GENE GREEN of mittee on Commerce. involvement in the regulatory development Texas, Mr. MOLLOHAN, and Mr. FLAKE. By Mr. BERMAN (by request): processes of the Environmental Protection H.R. 104: Mr. PETERSON of Minnesota and H.R. 1929. A bill to amend the Immigration Agency and the Occupational Safety and Mr. WATTS of Oklahoma. and Nationality Act to more effectively pre- Health Administration, and for other pur- H.R. 209: Mr. FIELDS of Texas. vent illegal immigration by improving con- poses; to the Committee on the Judiciary, H.R. 210: Mrs. CHENOWETH. trol over the land borders of the United and in addition to the Committee on Small H.R. 246: Mr. CRANE and Mr. SKEEN. States, preventing illegal employment of Business, for a period to be subsequently de- H.R. 303: Mr. MOLLOHAN and Mr. HINCHEY. aliens, reducing procedural delays in remov- termined by the Speaker, in each case for H.R. 353: Mr. MARTINI, Mr. MOORHEAD, Mr. ing illegal aliens from the United States, consideration of such provisions as fall with- KASICH, and Mr. DELLUMS. June 27, 1995 CONGRESSIONAL RECORD — HOUSE H 6397 H.R. 359: Mr. MASCARA. ana, Mr. BAKER of California, Mr. SAWYER, AMENDMENTS H.R. 390: Mr. FROST. Mr. TALENT, Mr. SCARBOROUGH, Mr. Under clause 6 of rule XXIII, pro- H.R. 394: Mr. MCCOLLUM, Mr. HOEKSTRA, and Mr. FUNDERBURK. SCARBOROUGH, Mr. MARTINI, Mr. FILNER, Mr. H.R. 1651: Mr. SMITH of New Jersey, Mr. posed amendments were submitted as LATHAM, Mr. SMITH of New Jersey, Mr. TAY- SAXTON, Mr. HOUGHTON, Mr. STUPAK, Mr. follows: LOR of Mississippi, Mr. SMITH of Texas, Mr. MCHUGH, Mr. DEUTSCH, Mr. HILLIARD, Mr. H.R. 1868 MOORHEAD, and Mr. ROBERTS. ENGLISH of Pennsylvania, and Mr. BAKER of OFFERED BY: MR. GOSS H.R. 408: Mr. BLUTE. Louisiana. AMENDMENT NO. 74: Page 78, after line 6, in- H.R. 469: Mr. DEUTSCH. H.R. 1675: Mr. JONES, Mr. TANNER, Mr. sert the following new section: H.R. 475: Mr. SENSENBRENNER. HASTINGS of Washington, Mr. DUNCAN, Mr. H.R. 488: Mr. WALSH, Ms. PRYCE, Mr. HORN, LONGLEY, Mr. HAMILTON, and Mr. SAXTON. LIMITATION ON FUNDS FOR HAITI and Mr. PASTOR. H.R. 1684: Mr. WHITE, and Mrs. SEASTRAND. SEC. 564. Effective March 1, 1996, none of H.R. 582: Mr. DREIER. H.R. 1713: Mr. MCKEON, Mr. JOHNSON of the funds appropriated in this Act may be H.R. 598: Mr. BONILLA, Mr. CRANE, Mr. South Dakota, and Mr. ENSIGN. made available to the Government of Haiti STARK, Mr. TAUZIN, Mr. BROWNBACK, Mr. H.R. 1739: Mr. KOLBE, Mr. PETE GEREN of when it is made known to the President that WAMP, Mr. LONGLEY, Mr. GENE GREEN of Texas, and Mr. WATTS of Oklahoma. such Government is controlled by a regime Texas, Mr. LEWIS of Kentucky, Mr. BAESLER, H.R. 1748: Mr. MINGE and Mr. FROST. holding power through means other than the Mr. HUTCHINSON, Mr. ROYCE, Ms. DANNER, H.R. 1758: Mr. FAZIO of California. democratic elections scheduled for calendar Ms. ROS-LEHTINEN, Mr. DEAL of Georgia, Mr. H.R. 1774: Mr. LIPINSKI and Mr. DELLUMS. year 1995 and held in substantial compliance ANDREWS, and Mr. WHITFIELD. H.R. 1801: Mr. CREMEANS, Mr. CHRYSLER, with the requirements of the 1987 Constitu- H.R. 676: Mrs. LOWEY. and Mr. SCARBOROUGH. tion of Haiti. H.R. 752: Mr. UNDERWOOD, Mr. HAYWORTH, H.R. 1807: Mr. LANTOS, Mr. LUTHER, and H.R. 1868 Mr. FLAKE, Mrs. FOWLER, Mr. BONIOR, Mr. Ms. NORTON. HASTINGS of Washington, Mr. TAUZIN, Mr. OFFERED BY: MS. JACKSON-LEE WICKER, Mr. CHRYSLER, Mr. BOEHNER, Mr. H.R. 1818: Mr. ROBERTS, Mr. HUTCHINSON, AMENDMENT NO. 75: Page 19, Line 16, strike LARGENT, Mr. CHABOT, and Mr. ORTON. Mr. BAKER of Louisiana, and Mr. SALMON. ‘‘$10,000,000’’ and insert in lieu thereof H.R. 771: Mr. BARCIA of Michigan and Mr. H.R. 1821: Mr. STUPAK and Mr. FRANK of ‘‘$11,500,000’’. YOUNG of Alaska. Massachusetts. Page 23, line 6, strike ‘‘39,000,000’’ and in- H.R. 789: Mr. COX, Mrs. CUBIN, Mr. SAWYER, H.R. 1833: Mr. STENHOLM, Mr. BARCIA of sert in lieu thereof ‘‘37,500,000’’. Michigan, Mr. BLILEY, Mr. PETERSON of Min- and Mr. COMBEST. H.R. 1868 H.R. 816: Mr. MCCRERY. nesota, Mr. HOSTETTLER, Mr. HOLDEN, Mrs. OFFERED BY: MS. KAPTUR H.R. 852: Mr. MARTINEZ. CHENOWETH, Mr. VOLKMER, Mr. MANZULLO, H.R. 858: Mr. ENGEL, Mr. FRANK of Massa- Mr. KLINK, Mr. SCARBOROUGH, Mr. TAUZIN, AMENDMENT NO. 76. Page 78, after line 6, in- chusetts, Mr. GEJDENSON, Mr. WILLIAMS, and Mr. HASTERT, Mr. LIPINSKI, Mr. ISTOOK, Mr. sert the following new section: Mr. DICKS. BURTON of Indiana, Mr. HUTCHINSON, Mr. LIMITATION ON FUNDS FOR NORTH AMERICAN H.R. 860: Mr. SALMON and Mr. UPTON. GUTKNECHT, Mr. DOOLITTLE, Mr. BARTLETT of DEVELOPMENT BANK H.R. 911: Mr. BONIOR, Ms. VELAZQUEZ, Mr. Maryland, Mr. TIAHRT, Mr. CRANE, Mr. SEC. 564. None of the funds appropriated in SHADEGG, Mr. COLLINS of Georgia, Mr. DE LA GARZA, Mr. FAZIO of California, Mr. this Act under the heading ‘‘North American BARRETT of Nebraska, Mr. MCDADE, Mr. MAS- MANTON, Mr. MCNULTY, Mr. NEAL of Massa- Development Bank’’ may be expended except CARA, Mr. SALMON, Mr. BONO, Mr. GRAHAM, chusetts, and Mr. FRANKS of New Jersey. when it is made known to the disbursing offi- H.R. 1020: Mr. CRANE, Mr. SHAW, Mr. EHR- Mr. HUNTER, Mr. SOLOMON, Mr. UNDERWOOD, cial concerned that the Government of Mex- LICH, Mr. KANJORSKI, Mr. FROST, Mr. WICKER, Mr. WICKER, and Mr. WAMP. ico has contributed to the North American Mr. TAYLOR of Mississippi, Mr. NETHERCUTT, H.R. 1834: Mr. BARR, Mr. CHRYSLER, Mr. Development Bank its share of the paid-in and Mr. GREENWOOD. COLLINS of Georgia, Mr. DEAL of Georgia, Mr. portion of the capital stock for fiscal year H.R. 1033: Mr. LAZIO of New York. HASTINGS of Washington, Mr. HAYWORTH, Mr. 1996, $56,250,000. H.R. 1047: Mr. MCINTOSH. HILLEARY, Mr. KINGSTON, Mr. LARGENT, and H.R. 1114: Mr. TAYLOR of Mississippi, Ms. Mr. METCALF. H.R. 1868 PRYCE, Mr. WELLER, Mr. ARCHER, Mr. ROB- H.R. 1840: Mr. HERGER, Mr. STOCKMAN, Mr. OFFERED BY: MRS. MEEK OF FLORIDA ERTS, Mr. SAM JOHNSON, Mr. STEARNS, Mr. PACKARD, and Mrs. SEASTRAND. (Amendment to the Amendment Offered by Mr. FRANKS of New Jersey, Mr. LEWIS of Ken- H.R. 1856: Mr. CRAPO, Mr. COBLE, and Mr. Goss) tucky, and Mr. STOCKMAN. MCHUGH. AMENDMENT NO. 77. In the matter proposed H.R. 1143: Mr. ROMERO-BARCELO, Ms. KAP- H.R. 1884: Mr. FROST. to be inserted by the amendment, strike TUR, and Mr. OLVER. H.R. 1885: Mr. BLUTE and Mr. WAMP. ‘‘when it is made known’’ and all that fol- H.R. 1144: Ms. KAPTUR, Mr. ROMERO- H.J. Res. 78: Mr. CLAY, Mr. GEPHARDT, and lows and insert the following: BARCELO, and Mr. OLVER. Mr. COSTELLO. except when it is made known to the Presi- H.R. 1145: Mr. ROMERO-BARCELO, Ms. KAP- H.J. Res. 84: Mr. BECERRA. dent that such Government is making con- TUR, and Mr. OLVER. H. Con. Res. 4: Mr. SOUDER and Mr. EHR- tinued progress in implementing democratic H.R. 1176: Mr. FRANKS of Connecticut. LICH. elections. H.R. 1203: Mr. PETRI, Mr. CRAPO, Mr. H. Con. Res. 42: Mr. FRANKS of New Jersey, LEACH, Mr. NUSSLE, and Mr. FOX. Ms. FURSE, and Mr. KILDEE. H.R. 1868 URR ASS H.R. 1226: Mr. B , Mr. B , and Mr. H. Con. Res. 50: Ms. RIVERS, Mr. SCOTT, and OFFERED BY: MR. PORTER HEFLEY. Mr. HALL of Ohio. AMENDMENT NO. 78: Page 15, line 4, insert H.R. 1227: Mr. JACOBS and Mr. EHLERS. H. Con. Res. 65: Mr. MENENDEZ, Ms. ESHOO, ‘‘or Turkey’’ after ‘‘Zaire’’. H.R. 1278: Mr. LEWIS of Georgia, Mr. GENE Mr. FRANK of Massachusetts, Mrs. ROUKEMA, GREEN of Texas, and Mr. FALEOMAVAEGA. H.R. 1868 Ms. SLAUGHTER, Mr. CLAY, Mr. MILLER of H.R. 1296: Mr. GALLEGLY and Mr. California, Ms. JACKSON-LEE, Miss COLLINS of OFFERED BY: MR. SMITH OF NEW JERSEY RADANOVICH. Michigan, Mr. LIPINSKI, and Mr. WAXMAN. AMENDMENT NO. 79. Page 78, after line 6, in- H.R. 1314: Mr. COYNE. H. Con. Res. 76: Mr. COLEMAN, Mr. BROWN sert the following new section: H.R. 1317: Mr. LONGLEY. of California, Mr. FRANK of Massachusetts, PROHIBITIION OF FUNDING FOR ABORTION H.R. 1384: Mr. FLANAGAN and Mr. QUINN. and Mr. BRYANT of Texas. H.R. 1406: Mr. WAXMAN, Mr. WELDON of SEC. 564. (a) IN GENERAL.— H. Res. 21: Mr. GUTKNECHT. Pennsylvania, Mr. MONTGOMERY, Mr. DOYLE, (1) Notwithstanding any other provision of Mr. KANJORSKI, Mr. ENGLISH of Pennsylva- f this Act or other law, none of the funds ap- nia, and Mr. PAYNE of Virginia. propriated by this Act for population assist- H.R. 1533: Mr. CHRISTENSEN. PETITIONS, ETC. ance activities, may be made available for H.R. 1536: Mr. FLANAGAN and Mr. QUINN. Under clause 1 of rule XXII, petitions any private, nongovernmental, or multilat- eral organization until the organization cer- H.R. 1541: Mr. LIPINSKI and Mr. ENGLISH of and papers were laid on the Clerk’s Pennsylvania. tifies that it does not and will not during the H.R. 1567: Mr. DEFAZIO, Mr. FATTAH, and desk and referred as follows: period for which the funds are made avail- Mr. LIPINSKI. 26. By the SPEAKER: Petition of the 47th able, directly or through a subcontractor or H.R. 1619: Mr. SMITH of New Jersey, Ms. student senate, Florida State University, sub-grantee, perform abortions in any for- PELOSI, and Mr. TAYLOR of North Carolina. relative to H.R. 1709; to the Committee on eign country, except where the life of the H.R. 1626: Mrs. THURMAN, Mr. CANADY, Mr. National Security. mother would be endangered if the fetus DEUTSCH, Mr. STEARNS, and Mr. PETERSON of 27. Also, petition of the common council of were carried to term or in cases or forcible Florida. the city of Buffalo, NY, relative to the His- rape or incest. H.R. 1627: Mr. HOBSON and Mr. HOUGHTON. toric Homeownership Assistance Act; to the (2) Paragraph (1) may not be construed to H.R. 1640: Mr. SHAYS, Mr. BARTLETT of Committee on Banking and Financial Serv- apply to the treatment of injuries or ill- Maryland, Mr. LIPINSKI, Mr. BURTON of Indi- ices. nesses caused by legal or illegal abortions or H 6398 CONGRESSIONAL RECORD — HOUSE June 27, 1995 to assistance provided directly to the gov- tion and Refugee Assistance Act; (3) allow- (B) is pursuing international anti-drug ernment of a country. ances as authorized by sections 5921 through trafficking initiatives. (b) LOBBYING ACTIVITIES.— 5925 of title 5, United States Code; or (4) ad- H.R. 1905 (1) Notwithstanding any other provision of ministrative expenses. this Act or other law, none of the funds ap- H.R. 1868 OFFERED BY: MR. FORBES propriated by this Act for population assist- OFFERED BY: MR. SOUDER AMENDMENT NO. 11: Page 16, line 1, strike ance activities may be made available for AMENDMENT NO. 81: Page 78, after line 6, in- ‘‘$2,596,700,000’’ and insert ‘‘$2,696,700,000’’. any private, nongovernmental, or multilat- sert the following: Page 20, line 8, strike ‘‘$362,250,000’’ and in- eral organization until the organization cer- sert ‘‘$262,250,000’’. tifies that it does not and will not during the LIMITATION ON ASSISTANCE TO MEXICO Page 20, line 25, strike ‘‘$239,944,000’’ and period for which the funds are made avail- SEC. 564. (a) IN GENERAL.—None of the insert ‘‘$139,944,000’’. able, violate the law of any foreign country funds appropriated or otherwise made avail- concerning the circumstances under which able by this Act may be obligated or ex- H.R. 1905 pended for the Government of Mexico, except abortion is permitted, regulated, or prohib- OFFERED BY: MR. HOKE ited, or engage in any activity or effort to if it is made known to the Federal entity or alter the laws or governmental policies of official to which funds are appropriated AMENDMENT NO. 12: At the end of the bill, any foreign country concerning the cir- under this Act that— insert after the last section (preceding the cumstances under which abortion is per- (1) the Government of Mexico is taking ac- short title) the following new section: mitted, regulated, or prohibited. tions to reduce the amount of illegal drugs SEC. 505. The Secretary of Energy shall (2) Paragraph (1) shall not apply to activi- entering the United States from Mexico by transmit a report to the Congress each time ties in opposition to coercive abortion or in- at least 10 percent of the level of such illegal the Secretary authorizes the payment of voluntary sterilization. drugs from the previous year, as determined travel expenses of the Secretary or other em- (c) COERCIVE POPULATION CONTROL METH- by the Director of the Office of National ployees of the Department of Energy in ex- ODS.—Notwithstanding any other provision Drug Control Policy; and cess of an aggregate of $5,246,200 for fiscal of this Act or other law, none of the funds (2) the Government of Mexico— year 1996. Such report shall describe the appropriated by this Act may be made avail- (A) is taking effective actions to apply vig- amount authorized, the purposes for which able for the United Nations Population Fund orously all law enforcement resources to in- such funds were originally allocated, and the (UNFPA), unless the President certifies to vestigate, track, capture, incarcerate, and travel expenses for which they are used. prosecute illegal drug kingpins and their ac- the appropriate congressional committees H.R. 1905 that (1) the United Nations Population Fund complices, individuals responsible for, or has terminated all activities in the People’s otherwise involved in, corruption, and indi- OFFERED BY: MR. HOKE viduals involved in money-laundering; and Republic of China; or (2) during the 12 AMENDMENT NO. 13: Page , after line , in- (B) is pursuing international anti-drug months preceding such certification, there sert the following new section: trafficking initiatives. have been no abortions as the result of coer- H.R. 1868 SEC. . TRANSFER OF FUNDS FOR TRAVEL. cion associated with the family planning The Secretary of Energy shall transmit a OFFERED BY: MR. SOUDER policies of the national government or other report to the Congress each time the Sec- AMENDMENT NO. 82: Page 78, after line 6, in- governmental entities within the People’s retary authorizes the payment of travel ex- sert the following: Republic of China. As used in this section penses of the Secretary or other employees the term ‘‘coercion’’ includes physical duress LIMITATION ON ASSISTANCE TO MEXICO of the Department of Energy in excess of an or abuse, destruction or confiscation of prop- SEC. 564. (a) IN GENERAL.—None of the aggregate of $5,246,200 for fiscal year 1996. erty, loss of means of livelihood, or severe funds appropriated or otherwise made avail- Such report shall describe the amount au- psychological pressure. able by this Act may be obligated or ex- thorized, the purposes for which such funds H.R. 1868 pended for the Government of Mexico, except were originally allocated, and the travel ex- OFFERED BY: MR. SMITH OF NEW JERSEY if it is made known to the President that— penses for which they are used. (1) the Government of Mexico is taking ac- AMENDMENT NO. 80: Page 78, after line 7, in- H.R. 1905 sert the following new section: tions to reduce the amount of illegal drugs entering the United States from Mexico by OFFERED BY: MR. KLUG PROHIBITION ON USE OF MIGRATION AND REFU- at least 10 percent of the level of such illegal GEE ASSISTANCE FUNDS FOR ADMINISTRATIVE AMENDMENT NO. 14: Page 16, line 2, insert drugs from the previous year, as determined before the period the following: EXPENSES by the Director of the Office of National SEC. 564. Notwithstanding any other provi- Drug Control Policy; and : Provided, That, of such amount, $44,772,000 sion of this Act to the contrary, none of the (2) the Government of Mexico— shall be available to implement the provi- funds made available in this Act under the (A) is taking effective actions to apply vig- sions of section 1211 of the Energy Policy Act heading ‘‘Migration and Refugee Assistance’’ orously all law enforcement resources to in- of 1992 (42 U.S.C. 13316) may be used for (1) salaries and expenses of vestigate, track, capture, incarcerate, and H.R. 1905 personnel and dependents as authorized by prosecute illegal drug kingpins and their ac- the Foreign Service Act of 1980; (2) salaries complices, individuals responsible for, or OFFERED BY: MRS. SMITH OF WASHINGTON and expenses of personnel assigned to the bu- otherwise involved in, corruption, and indi- AMENDMENT NO. 15: Page 14, line 13, strike reau charged with carrying out the Migra- viduals involved in money-laundering; and ‘‘$48,630,000’’ and insert ‘‘$48,150,000’’. E PL UR UM IB N U U S Congressional Record United States th of America PROCEEDINGS AND DEBATES OF THE 104 CONGRESS, FIRST SESSION

Vol. 141 WASHINGTON, TUESDAY, JUNE 27, 1995 No. 106 Senate (Legislative day of Monday, June 19, 1995)

The Senate met at 9:15 a.m., on the deadline and to provide certain safeguards to Mr. BRYAN. Mr. President, I ask expiration of the recess, and was called ensure that the interests of investors are unanimous consent that the order for to order by the President pro tempore well protected under the implied private ac- the quorum call be rescinded. tion provisions of the act. [Mr. THURMOND]. The PRESIDENT pro tempore. With- The PRESIDENT pro tempore. To- The Senate resumed consideration of out objection, it is so ordered. day’s prayer will be offered by Commis- the bill. f sioner Hodder, national commander of Pending: the Salvation Army. Bryan amendment No. 1474, to restore the PRIVATE SECURITIES LITIGATION liability of aiders and abettors in private ac- REFORM ACT PRAYER tions. The guest Chaplain, Commissioner Boxer-Bingaman amendment No. 1475, to The Senate continued with the con- Kenneth L. Hodder, national com- establish procedures governing the appoint- sideration of the bill. ment of lead plaintiffs in private securities mander of the Salvation Army, offered AMENDMENT NO. 1474 class actions. the following prayer: Mr. BRYAN. Mr. President, if I might Let us pray: f inquire of the Chair, it is my under- Lord, at the beginning of this new standing that on the Bryan amend- workday, we ask for an enlarged capac- RECOGNITION OF THE ACTING MAJORITY LEADER ment, there is a time agreement in ity to care for others. which the distinguished chairman of Help us to care—really care—for all The PRESIDENT pro tempore. The the Banking Committee has 15 minutes those with whom we serve in this distinguished acting majority leader. allotted to him and the proponents of Chamber. Many of us are carrying per- f the Bryan amendment have 15 minutes; sonal and painful burdens of which oth- is that correct? ers are unaware. So help us to work SCHEDULE The PRESIDENT pro tempore. The with each other with a gracious spirit Mr. BROWN. Mr. President, this Senator is correct. of caring, one that reaches beyond the morning, the leaders’ time has been re- Mr. BRYAN. Mr. President, I yield obvious and ministers to the hidden. served, and the Senate will imme- myself 8 minutes out of my allocated And help us to care—really care—for diately resume consideration of S. 240, time. this Nation of others. Surely people the securities litigation bill. There will matter most. Assist us, then, as we Mr. President, for the benefit of my be 30 minutes of debate in relation to struggle to balance our ideas with oth- colleagues, for six decades, the founda- the pending Bryan amendment regard- ers’ aspirations, our causes with oth- tion upon which public confidence in ing aiding and abetting, to be followed ers’ concerns, and our passions with the American securities market has by 30 minutes on the Boxer amendment others’ needs. been built rests upon two fundamental We pledge to assist You in answering regarding lead plaintiff. premises: First, effective regulation by this prayer by our thinking, speaking, At the hour of 10:15 this morning, the Securities and Exchange Commis- and doing this day. there will be two stacked rollcall votes sion; second, the right of individual in- And it is in Your strong name that on or in relation to the pending amend- vestors who have been defrauded to we ask these things and offer ourselves. ments. pursue a private cause of action Amen. The Senate will stand in recess today against those wrongdoers. from the hour of 12:30 p.m. to 2:15 p.m. f Mr. President, I greatly fear that S. for the weekly policy luncheons to 240, as it is being processed through PRIVATE SECURITIES LITIGATION meet. this Chamber, will, for all intents and REFORM ACT Mr. President, at this time I suggest purposes, emasculate that private The PRESIDENT pro tempore. Under the absence of a quorum, and I ask cause of action, which has been so im- the previous order, the Senate will now unanimous consent that the time be di- portant in keeping the American secu- resume consideration of S. 240, which vided equally. rities market safe and sound and inves- the clerk will report. The PRESIDENT pro tempore. With- tor confidence high. Those are not just The assistant legislative clerk read out objection, it is so ordered. The statements made by the Senator from as follows: clerk will call the roll. Nevada. The former Chairman of the A bill (S. 240) to amend the Securities and The assistant legislative clerk pro- SEC, Mr. Breeden, the last Republican Exchange Act of 1934 to establish a filing ceeded to call the roll. Chairman, made similar statements in

∑ This ‘‘bullet’’ symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor.

S 9109 S 9110 CONGRESSIONAL RECORD — SENATE June 27, 1995 testimony before the Banking Commit- aiders and abettors ought not to be Sure, we want to get at the plaintiff’s tee during his tenure. The current available. Here are some of the aiders lawyers that file frivolous actions, and Chairman, Mr. Levitt, has also made and abettors: Parker Milliken, Kay the enhanced provisions of rule 11 that proposition. Sholer, Sidley & Austin, Michael under the Federal Rules of Civil Proce- The amendment before us seeks to Milken; $121 million of the overall dure address that issue. correct a decision by the Supreme value of $262 million would be wiped The amendment before the Senate Court decided last year by a narrow 5- out if that action was filed today. So would simply restore aiding and abet- to-4 margin that wipes out liability for we are down now to $141 million. ting liability. Zippo, no recovery at all. aiders and abettors. Previously, I offered for the consider- Intentional misconduct, knowing mis- Now, there has been much debate on ation of the Senate a recommendation conduct, reckless misconduct—not 1 the floor of the Senate about propor- shared by the SEC, by the State Secu- cent could be recovered under a theory tionate liability, joint and several li- rities Association, by every regulator, of aider and abettor liability under the ability, intentional misconduct, know- by consumer groups, by those charged state of the law today, unless the ing misconduct, and reckless mis- with public finance responsibilities at Bryan amendment is enacted. conduct. None of those distinctions the State and local government level, May I inquire, I have used my time; makes a whit of difference if this to extend the statute of limitations, how is the time being charged at this amendment is not granted, because which is currently limited to 1 to 3, to point? under the current State of the law, no make it a 2-year to 5-year statute of The PRESIDING OFFICER (Mr. aider and abettor is liable under that limitations. COVERDELL). The Senator has approxi- theory, irrespective of his or her mis- Had the action against Charles mately 3 minutes remaining on his conduct. Everyone is home free. Keating been brought today, 20 percent side. I cannot conceive of a public policy of the class claims would have been Mr. D’AMATO. Mr. President, this is, that would support that conclusion. barred because of this restricted stat- admittedly, a very complex subject. We And, indeed, the prime sponsors of this ute of limitations. Another $28 million must distinguish between knowingly legislation have previously written—I in recovery, wiped out. and intentionally having committed a refer to the distinguished Senator from These are people like the Jeri fraudulent act and recklessly commit- Connecticut and the senior Senator Mellons. I suspect that virtually every ting an act. from New Mexico—expressing their Member of this Senate has had individ- What is the difference between reck- support for restoration of aider and uals who lost money as a result of the less conduct and intentional and know- abettor liability. Keating fraud. ing fraud? What standard of proof is Interspersed throughout all of this The recovery is down $262 million, to there between gross negligence, neg- debate has been a great antipathy to $113 million. Joint and several liabil- ligence, and recklessness? These are plaintiff’s lawyers. I understand that ity: Under the provisions of S. 240, in not clear distinctions and it is because antipathy and I do not, for a moment, order to be jointly and severally liable, of these blurred distinctions that there doubt that there has been some mis- you have to either have knowing mis- has been a large body of case law, over conduct, and some provisions in S. 240 conduct or intentional misconduct. the years, trying to make the defini- deal with that misconduct. But let me Reckless misconduct no longer does it. tions clear. This is particularly true in point out that aiders and abettors are Although I recognize a distinction the area of reckless conduct; over the also lawyers, and if misconduct on the can be made between the two of those, years a number of courts have given part of the plaintiff’s bar ought to be the amendment that Senator SARBANES the interpretation that someone who addressed—as it ought to—under what and I sought to offer in one form or an- was not the primary wrongdoer, but theory of social or economic justice, other, sought to make sure that if the participated in the fraud and know- can we assert that those who are part primary violator is insolvent, that ingly and substantially assisted in the of the conspiracy itself—lawyers and those who are guilty of reckless mis- fraud could be held liable. This does accountants, primarily, and to some conduct—it is not ordinary negligence, not seem to me to be reckless conduct extent bankers—in effect, be given a not simple negligence—if a Member of but knowing fraud. blank check? If they did not sign their this Chamber goes out this evening, Courts have found, over the years, names to any of the statements, in ef- gets in his or her automobile, is in- that a firm could be held fully liable fect, they have no liability. volved in an accident and is negligent, for conduct which the average person Now, is this theoretical? Is it eso- that Member is responsible to the would consider imprudent, negligent, teric? No. If the state of law at the party to whom he or she has inflicted or careless. Some circuit courts have time of the Keating actions—one of the the injury. Not so with securities law. recognized this so-called aiding and most notorious securities frauds of this Only if they are guilty of reckless mis- abetting liability as part of the reck- century—were in the form that it is conduct. lessness standard. today, here is what would occur. My In effect, as a result of the changes Aiding and abetting liability holds colleagues will recall that Mr. Keating, we make in the joint and several liabil- the business community to an incred- the primary wrongdoer, was bankrupt. ity, those who are proportionally liable ibly high standard, particularly when No recovery from him. Some $262 mil- pay only their share. It is estimated they can be held liable for damages lion were recovered as a result of the that another $67 million would be that are far greater that any damage Keating fraud by private investors. wiped out in terms of investor recovery that they have caused. There is a real Jeri Mellon, a retired woman who lives if the Keating case were brought today. culprit to hold liable. The primary in Henderson, NV, a suburb of Las S. 240 also wipes out the Rico treble wrongdoer is somebody that has really Vegas, who came back, most of her sav- damages provision, and another $30 committed fraud, who has practiced ings were lost as a result of the fraud. million. avarice and greed, who has wantonly She joined with others similarly situ- So if the Keating case were brought and knowingly broken the law. ated in a class action to recover today, with the state of the law as it The Supreme Court decided that aid- money. They recovered $262 million. exists on this morning as this debate ing and abetting liability applies to If that action were brought today, continues, rather than $262 million re- someone who is not the primary wrong- because aiding and abetting is no covered by innocent investors, many of doer but participated in a fraud and longer a part of the law as a result of whom lost their life savings—and a dis- knowingly and substantially assisted the Central Bank of Denver case—I proportionately large number, small, in the fraud. In the Central Bank of might add, the Court, in deciding that elderly, retired investors who had little Denver case, the Court decided there case, said, look, we do not believe that likelihood of ever regaining their loss— was no aiding and abetting liability for the statute can be construed to apply $262 million of recovery would be re- private lawsuits involving fraud. to aider and abettor liability, but we duced to $16 million. The Supreme Court did not believe sure as the devil believe that there Mr. President, I ask my colleagues, that section 10(b) intended to cover ought to be liability. So this was not a under what theory of social or eco- aiding and abetting liability. Providing value judgment made by the Court that nomic justice do we want to do this? for aiding and abetting liability under June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9111 section 10(b) would be contrary to the This amendment would actually de- This amendment simply indicates goals of this legislation. stroy a good part of what this legisla- whether or not the Senate of the Unit- This bill is aimed at reducing frivo- tion attempts to do in terms of keeping ed States believes that those who coun- lous litigation. Even the Supreme lawyers honest and protecting those sel, who aid, who provide assistance to Court recognized that expanding 10(b) people who did not commit fraud, but those who perpetrate investor fraud, to include aiding and abetting liability were associated with those who did. It ought to be held responsible. Under the would lead many defendants to settle is my belief that these firms, the so- current law, aiders and abettors are to avoid the expense and risk of going called aiders and abettors, are only not liable. Among that group are the to trial. brought in to these suits because of lawyers who have been the focus of The Supreme Court said, ‘‘Litigation their deep pockets. They are profes- much criticism during the course of under rule 10b-a presents a danger vex- sionals; securities analysts, account- the debate. atiousness, different in degree and in ants, and bankers who are involved in Sidley & Austin, Jones Day. These kind, and would require secondary ac- some way with the fraudulent party. are law firms. A vote against the Bryan tors to expend large sums even for pre- They get brought in to the lawsuits amendment places the individual Sen- trial defense and the negotiation of set- and have to spend millions of dollars ator and this Congress on record as tlement.’’ defending themselves. And their law- saying this kind of conduct—mis- As I have said, aiding and abetting li- yers tell them that there is a chance conduct in my view—ought to be toler- ability would require secondary ac- that ‘‘you may be held liable for the ated, approved, and tacitly accepted. I tors—not the primary wrongdoer, the full amount.’’ Why? Because when the cannot conceive of such a result. person who has committed the fraud— name of a primary wrongdoer like A decade ago the Congress of the to expend large sums, even for pretrial Keating comes up, you are ‘‘guilty by United States enacted a piece of legis- defense, and the negotiation of settle- association.’’ lation, Garn-St Germain, that led, ment. Any prudent lawyer would have to within a decade, to a savings and loan Indeed, I do not believe that just be- say that there is a chance you will be industry which cost the American tax- cause people have made settlements held liable if you were involved with a payers tens and tens of billions of dol- that they were guilty of fraud or that rogue—and there will be more rogues, lars. it was right and proper that they were make no mistake about it. I do not It is my view that S. 240, in its sued. care what kind of legislation we pass present form, without the kinds of When 93 percent of the cases—and I here, there will be others who break amendments the distinguished Senator know not all the defendants were the laws, who will do terrible things. It from Maryland and I have tried to add, brought in to these suits for aiding and is not right that an accountant, law will cause investor losses of those mag- abetting, I grant that—but 93 percent firm or securities broker is dragged in nitudes over the ensuing years, and es- of the defendants settled. These aiders and linked to the fraud because they sentially private causes of action will and abettors are people tangentially were asked to counsel and they gave be destroyed. involved in the fraud; they are brought some advice. They did not tell the Mr. SARBANES. Will the Senator into the suits only because they were wrongdoers to lie, they did not partici- yield for a question? involved with a scoundrel—a Keating— pate in fraud, but if they rendered Mr. BRYAN. I will be pleased to yield who was deliberately breaking the law. some professional service, by virtue of to the Senator. Often these aiders and abettors are ac- their being linked with by that fraud Mr. SARBANES. Am I correct, under countants who did not notice the fraud, they may be held liable by a jury. Do the legislation before us, there could be but possibly should have, yet we would you think that a defendant is going to no liability whatever imposed in a pri- hold them liable as if they committed be able to establish clearly what is vate action for aiding and abetting? the fraud. The Supreme Court said last reckless conduct and what is not? The Mr. BRYAN. The Senator is correct, year that aiding and abetting liability jury can find against them and then no liability. did not belong in private lawsuits in- hold them for hundreds of millions of Mr. SARBANES. In the Keating case, volving fraud. dollars in damages. That risk is why a large part of the recovery of the vic- Of course, if someone has knowingly, you have the incredible percentage of tims came from aiders and abettors, intentionally, misled investors or been settlements. did it not? involved in committing fraud, they are You heard Senator DODD last evening Mr. BRYAN. If I might respond to the no longer just aiders and abettors, and explain how it was that a prominent Senator, out of $262 million recovered can be held liable for their actions. firm, one of the big six accounting in a private cause of action—because Under S. 240, people who commit firms, did $15,000 worth of work, a con- Mr. Keating himself was bankrupt— fraud will be treated as primary wrong- tract to review something, and was $121 million of the $262 million was re- doers, as the culpable party, and can be then brought in to the suit. This ac- covered from aiders and abettors. held jointly and severally. counting firm did defend itself and won Under the state of law currently, that Further, S. 240 grants the Securities the case, but in winning the case ex- $121 million is wiped out. and Exchange Commission express au- pended over $6 million. We cannot sub- Mr. SARBANES. What public policy thority to prosecute cases against ject people to that kind of choice. I tell reason could there possibly be for let- wrongdoers who knowingly aid and you when that accounting firm is ting aiders and abettors go completely abet primary wrongdoers. hauled in the next time, it will settle. free? I understand there could be an ar- This issue is both very interesting This amendment would allow a firm gument about what standards to im- and very complex. It is not easy. First, that was associated with the fraudu- pose. But on what basis in public policy the circuit courts recognized aiding lent firm to be fully liable for the dam- is it that aiders and abettors go free? and abetting liability, then the Su- ages. This would move us in the wrong The PRESIDING OFFICER. The time preme Court decided there is no place direction, so I have to oppose this of the Senator from Nevada has ex- in these lawsuits for this liability. amendment. pired. Using the aiding and abetting liability I yield the floor. Mr. BRYAN. Might I inquire if the to proceed under rule 10(b) with a law- The PRESIDING OFFICER. Who acting floor manager will yield me 1 suit, which is what this amendment seeks recognition? minute to respond to the question of would do, would take us to a standard Mr. BRYAN. Mr. President, may I in- the Senator from Maryland? that the Supreme Court decided should quire what the state of time is? Mr. SARBANES. Mr. President, I ask not be applied. Again, I quote that this The PRESIDING OFFICER. The Sen- unanimous consent the Senator be al- liability standard ‘‘presents a danger of ator from Nevada has 21⁄2 minutes. The lotted 1 additional minute. vexatiousness, different in degree in Senator from New York has 2 minutes. The PRESIDING OFFICER. Without kind and would require secondary ac- Mr. BRYAN. Mr. President, let me, in objection, it is so ordered. tors to expend large sums, even for pre- 21⁄2 minutes, tell my colleagues this Mr. BRYAN. Mr. President, in re- trial defense and negotiations of settle- amendment has nothing to do with sponding to the question of the Senator ments.’’ frivolous lawsuits, absolutely nothing. from Maryland, I am at a total loss. It S 9112 CONGRESSIONAL RECORD — SENATE June 27, 1995 is beyond my comprehension, whether purported plaintiff class,’’ who is it we mous consent required under selection one positions himself or herself in the are describing? for subparagraph (a). political spectrum to the left of Fidel Mrs. BOXER. Everyone in the class. Mrs. BOXER. No. I would address my Castro or to the right of the Sheriff of We took it right from your bill. I guess friend to page 3 on the selection of lead Nottingham, under what theory you the bill the Senator is supporting; that counsel. The lead plaintiff or plaintiffs could say this kind of conduct ought to you have to advertise that class ac- appointed under paragraph 2 shall be be encouraged and to simply say to tions are about to take place and every subject to the approval of the court se- these folks, by and large: Hey, as long named plaintiff has a chance to vote on lecting the named counsel. So everyone as you are looking the other way and who the lead plaintiff shall be. We has a chance. All the plaintiffs have a not signing any documents, you can, think this is very democratic. Unlike chance to vote. with total impunity under the private your bill, the richest investor will be Mr. BROWN. My suggestion would be cause of action, counsel, aid, and pro- the lead plaintiff. if the Senator does not want to limit vide tangible help to perpetrators of in- Mr. BROWN. If the Senator would, that plaintiff class, having the words vestor fraud. It is simply incomprehen- my question is I think very specific. ‘‘who have moved the court to be ap- sible, I respond to my good friend. When it says all named plaintiffs, who pointed to serve as lead plaintiff,’’ I Mr. SARBANES. I thank the Sen- are those? Are those solely the ones think gives the impression that you ator. who brought the suit? have to have been in that group. But The PRESIDING OFFICER. Does the Mrs. BOXER. Every plaintiff of the the Senator mentioned ‘‘rich’’ under Senator from Colorado seek recogni- class who responded to become part of the bill. I have looked in the bill. I do tion? You have 2 minutes left. The the suit. There is a 90-day period where not find that term. Could she show me Chair recognizes the Senator from Col- they go out and advertise. where in the bill this indicates that the orado. Mr. BROWN. It would be the people richest one determines? Mr. BROWN. Mr. President, the dis- who brought the suit as well as people Mrs. BOXER. Certainly I will. Unfor- tinguished Senator from Nevada, I who decided to add their names? tunately, at this point I would need a think, is a very thoughtful Member and Mrs. BOXER. Everyone; all plaintiffs quorum call to find the exact place be- brings persuasive arguments to the who are interested in being part of the cause I am working off my amendment. floor on this and other issues that he suit gets to vote on who the lead plain- My friend did not tell me he was going takes on. The concern I find, as I listen tiff shall be. to question me about the exact word- to this, is the potential of holding Mr. BROWN. If that is the case, why ing of the bill itself. So could we put a someone liable for another’s actions do we have language ‘‘acting on behalf quorum call in place? I could find the when they had no idea that fraud, that of the purported plaintiff class who section. action, was taking place. That is what have moved the court to be appointed Mr. BROWN. Mr. President, I suggest this amendment does. This would hold to serve as lead plaintiff?’’ What if one the absence of a quorum. someone, an accountant, someone else of the outside plaintiffs has not moved Mr. SARBANES. If the Senator will involved in this process who has no the court to serve to be plaintiff? withhold, the bill says ‘‘in the deter- idea that a fraud is taking place, this Mrs. BOXER. I think the Senator is mination of the court has the largest would hold them liable even though confusing a very simple straight- financial interest in the relief sought they did not commit the fraud and forward point. We take the language by the class’’ on page 99 of the bill. they did not even know about the straight out of S. 240. In 90 days, there The PRESIDING OFFICER. Who fraud. are newspaper advertisements of gen- yields time? Making someone liable, taking mil- eral circulation, and everyone who is Mr. SARBANES. Will the Senator lions of dollars away from them, put- part of the class is invited to join in yield so I may respond to his question? ting them through this when they did the class. At that point in time, all the Mr. BROWN. Surely. not even know about the action seems plaintiffs who are in the suit—and ev- Mr. SARBANES. On page 99 of the to me to be outrageous. eryone is invited to be in—get to vote bill, the language is ‘‘in the determina- We yield the remainder of our time on who they want the lead plaintiff to tion of the court has the largest finan- on this side. be. If there is not a unanimous selec- cial interest in the relief sought by the AMENDMENT NO. 1475 tion then the judge appoints. class.’’ That is the language. The PRESIDING OFFICER. Under Mr. BROWN. My question was very Mr. BROWN. That was not the ques- the previous order, there will now be 30 specific. The question I have is this: If tion. That is an unresponsive answer. minutes debate on the Boxer amend- the intention is to have it include all The question was where in the bill is ment No. 1475, to be equally divided in plaintiffs, why do we modify this by ‘‘rich’’? The Senator had made the the usual form. saying ‘‘who have moved the court to point. The Senator from Colorado. be appointed to serve as lead plain- Mr. SARBANES. ‘‘The largest finan- Mr. BROWN. Mr. President, if the tiff’’? What if one of the outside plain- cial interest in the relief sought by the Senator from California is willing, I tiffs that joined the suit does not peti- class.’’ would like to address an inquiry to her tion the court to serve as lead plain- Mr. BROWN. The Senator from Mary- concerning her amendment. tiff? Does that mean that they have no land is telling me ‘‘rich’’ is not in the Mrs. BOXER. Certainly. voice under subparagraph (a) and they bill, that they use terms with regard to Mr. BROWN. On the first page of the are not required to consent to the nam- the ‘‘largest financial.’’ amendment, on page 98, following ing of lead plaintiff? Mr. SARBANES. The richest person through line 100, you put in a sub- Mrs. BOXER. My understanding of in the sense of having the ‘‘largest fi- section and insert the following sub- this amendment is clear. Everyone who nancial interest in the relief sought by section that reads: has joined in the suit has an equal say. the class’’ is the one you are putting Not later than 90 days after the date on And if they cannot agree, then the forward. which a notice is published under subpara- court shall appoint. In S. 240 it is the Mr. BROWN. Mr. President, let me graph (A) or (B) of paragraph (1), the court richest investor. So the answer is all simply note this. shall determine whether all named plaintiffs the plaintiffs get to choose. Mr. SARBANES. ‘‘The largest finan- acting on behalf of the purported plaintiff’s Mr. BROWN. Let me just say, at cial interest.’’ class who have moved the court to be ap- least for this Member, I was intrigued Mr. BROWN. I believe it is my time. pointed to serve as lead plaintiff under para- graph (1)(A)(ii) have unanimously selected a by the arguments of the Senator from Mr. President, who has the time? named plaintiff or plaintiffs to serve as lead California last night. As I read the bill, The PRESIDING OFFICER. The Sen- plaintiff or plaintiffs of the purported plain- it appears to me that the language here ator from Colorado has the floor. tiff class . . . . seems to imply that someone who is Mr. BROWN. Mr. President, we all I did not read all of that. My ques- not in the original filing, or more spe- make mistakes in debate on the floor. tion relates to it, and I frankly find it cifically had not moved the court to be I certainly am included. The point I a bit confusing. When we say ‘‘all appointed to serve as lead plaintiff, wanted to make was that the terms named plaintiffs acting on behalf of the would not have a voice in that unani- used by the Senator from Maryland June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9113 and the Senator from California are in upper income brackets. And this argu- thought we tried to get it down to fact not in the bill. The recitation and ment proves the point better than I where people can understand. My description of what was in the bill is ever could. friend wants me to say the ‘‘largest’’ not in the bill. What was said was inac- That is correct, I said the ‘‘richest’’ investor? I say the ‘‘richest’’ investor, curate. Mr. President, I think there is investor, and my friend takes great and he takes me on as if I have com- an important point here. umbrage with that. Let us just say mitted some kind of a sin. I stand by Let us assume you have two lawyers largest investor. That is what you say it. I think we need the Boxer amend- from New York who bring a class ac- in the bill. Let us stick with that. Be- ment. I think we need to send a mes- tion against Wells Fargo. Each one of cause let me tell you, if S. 240 had been sage from this Chamber that just be- them is worth $10 million each. The the law of the land during the Keating cause you are the largest investor does public employees pension fund is also a case, you know who the largest inves- not give you the right to take over shareholder of Wells Fargo. The man- tor was? A company that turned out to from everybody else, because let me ager of that public employees associa- be guilty in that case, a codefendant in tell you sometimes the largest investor tion has total assets about one-tenth of that case. So just because somebody does not really stand that much to lose what the lawyers from New York have. has the largest investment should not because maybe he has a very large dol- Who is rich? Who is the richest? Are make them automatically the lead lar investment but in accordance with the people worth $10 million, the law- plaintiff. his net worth it is not much, and some- yers in New York, who are professional Now, my friend can ignore it all he one who has invested $5,000 or $10,000 or plaintiffs, the poor ones in this? The wants, all he wants, but that is exactly $20,000 has much more to lose. answer is obvious. The professional what S. 240 does. And I think it is I brought to my colleagues’ attention plaintiffs who are worth $10 million elitist, I think it is antidemocratic, yesterday a woman from California each are a lot richer than the person and I say to my friend that just be- who was bilked of $20,000 by Charles who happens to work for a living and cause you may be wealthier, richer, if Keating. That may not sound like a lot manage the assets of the California you will—and I am not going to change to my Republican friend on the other employees’ pension fund. But the Cali- my language—have a bigger invest- side, who chastised me for using the fornia employees’ pension fund has a ment than everyone else does not make word ‘‘rich,’’ but I can tell you that great deal larger financial interest. you better than anyone else. And if $20,000 was the difference for this Mr. President, I simply want to as- America stands for anything, it stands woman in being able to sleep at night sure the Senator from California, for for that premise. and pay her bills and have a sense of whom I have great respect, that if she Now, I want my friend to know—and security. is concerned about improving on who he cares a lot about process—that this Mr. President, at this time I reserve we select to be the lead plaintiff, I will provision he defends here today—and I the remainder of my time and ask, if join her. But setting up a provision ask my friend, was my friend involved there is a quorum call, it be divided where professional litigants get to in the writing of this bill? I ask my from each side equally. name the lead plaintiff and close other friend from Colorado, did he partici- The PRESIDING OFFICER. Who people out I think is a problem. The pate in the markup on this bill? yields time? way I read this measure is it says that Mr. BROWN. I am not a member of Mr. BROWN addressed the Chair. the people who bring the suit agree, the committee. The PRESIDING OFFICER (Mr. and they may only have one share Mrs. BOXER. I think that is a point. CAMPBELL). The Senator from Colo- each. They may be in this only for the He stands up here, and he argues about rado. purposes of getting a lawsuit and nam- something he never marked up. The Mr. BROWN. Mr. President, I feel bad ing the plaintiff and getting to name fact is we held a lot of hearings on this, that the Senator from California has the lawyer. But if the people who are and no one ever brought this issue for- responded the way she has. At least my professional litigants agree and bring ward about selecting the lead plaintiff. experience in this Chamber and the the suit, they can name the lead plain- It was brought 4 days before the mark- legislative process is that when you tiff. They can control the lawsuit. up, with not one hearing. The SEC has read the language and there is a prob- They can name the lawyer and they concerns about it. The SEC is very con- lem with the language and you offer to can benefit indirectly from the attor- cerned about it. They do not know how work on that, Senators are grateful. ney’s fees. That is what this is all it would work. They think it is going All of us have an interest in good legis- about. to lead to more litigation, because lation. The Senator has indicated that it is what if what the Senator from Califor- As I read this amendment—and I not her intention to exclude those who nia says is accurate, that in many have quoted the exact language—it did not specifically move the court to cases you are going to have the lead says, ‘‘acting on behalf of the pur- be appointed as lead plaintiff. It is not plaintiff be someone who is eventually ported plaintiff class who have moved her intention to exclude plaintiffs. It named as a coconspirator, a the court to be appointed as lead plain- may not have done that. But that is codefendant? Imagine the kind of law- tiff.’’ the wording of the amendment. If that suits that would bring about. As I read that—and I certainly could is not the intention, the language Look, I do not care who is appointed be wrong; I do not mean to hold myself ought to be corrected. attorney. I could care less. There is out as the authority—I think it sug- Mr. President, more important than going to be an attorney for the class. gests in very plain English you have to anything else, if her purpose is to get The question is, should it be automati- move the court to be appointed as lead the best lead plaintiff possible, I would cally the prerogative of the largest in- plaintiff to come under that category. suggest that we ought to focus on that vestor to determine the course of the That means some people could be question, and that we should not carve case? plaintiffs that would be excluded. That out an exception for those who are pro- Now, in the Boxer amendment, we is a drafting problem. It may not be a fessional litigants who may have say, if the plaintiffs cannot agree drafting problem, but it certainly brought the suit. unanimously—and any plaintiff can be ought to be clarified, and it ought to be I reserve the remainder of my time. part of that discussion—then the judge clarified for the benefit of the Senator Mrs. BOXER addressed the Chair. gets to select the lead plaintiff based from California. The PRESIDING OFFICER. The on a number of criteria. Now, the Senator from California has Chair recognizes the Senator from I am very proud that Senator BINGA- talked about democracy in this proc- California. MAN and many others are supporting ess. Mr. President, what we are in- Mrs. BOXER. I have heard a lot of me in this amendment. We can twist volved with here today, if this amend- distortions on this floor, but this one and turn and chastise people for using ment passes, is stuffing the ballot box. takes the cake. I say to my friends on plain English on this floor, and maybe And let me be specific. You can have the other side, if you ask the public my friend just wants to talk about the one share of stock and bring the class who they stand and represent, most exact language in the bill. I never action, and the California public em- people would say it is those in the thought we did that around here. I ployees trust fund that may have a S 9114 CONGRESSIONAL RECORD — SENATE June 27, 1995 million shares of stock and represent The SEC, which examined this provi- Mrs. BOXER. Mr. President, I want 100,000 people may be excluded from the sion of the legislation, having looked to ask my friend from Colorado a ques- process of selecting the lead plaintiff. at it and having looked at the very pro- tion. My friend from Colorado made Now, that is not right, and that is vision the Senator is making reference two attacks on this Senator’s amend- not democracy. Should the California to, said that: ment, certainly not on the Senator, so public employees trust fund, a retire- It may create additional litigation con- I do not take it personally at all. The ment fund, that owns a million times cerning the qualifications of the lead plain- two attacks were, one, that the Sen- as many shares as a professional plain- tiff, particularly when the class member ator from California said the richest tiff, have more voice? I think they with the greatest financial interest in the investor and he took umbrage and said, should. If they own a million times as litigation has ties to management or inter- ‘‘Well, wait a minute, the word ’rich- many shares, they surely should have a ests that may be different from other class members. est’ is not in the bill.’’ OK, that is larger voice in the selection of this. right, the largest investor—I say the So clearly there is a problem here. This amendment stuffs the ballot richest investor. I stand by that, with And the way the bill is written it may box. It says the people who brought the all due respect. place the lead plaintiff position in the suit and who have moved the court to Second, the Senator says that only a hands of people about whom the SEC be appointed to serve as lead plaintiff certain number of the plaintiffs can, in has raised large and significant ques- end up, under the first option, being fact, vote on who the plaintiff should tions. able to dictate who the lead plaintiff is be. The fact is if the Boxer amendment and end up being able to dictate who I thank the Senator for yielding. Mrs. BOXER. I thank my friend. becomes law, every single potential the lawyer is who gets the fees and Mr. BROWN. May I respond? plaintiff in the country, member of the ends up being able to help guide the Mrs. BOXER. Mr. President, how class action, has an opportunity to be case. much time do I have? part of the selection. This is not some Now, that is wrong. To have a person The PRESIDING OFFICER. Five secret thing of stuffing the ballot box. with one share or five shares control an minutes fifty seconds. Any plaintiff who joins the class, peti- action where the California public em- Mrs. BOXER. How much time does tions the court, votes. ployees trust fund may have a million the Senator from Colorado have re- Now, if the Senator believes that the shares is wrong. maining? largest investor would not get involved Let me reiterate. If there is interest The PRESIDING OFFICER. The Sen- in that, I do not know what the Sen- in adding fairness to this process, we ator from Colorado has none. ator thinks. But the fact is I do not ought to do it. One thing I might men- Mrs. BOXER. I will be glad to yield if care who the attorney is who gets to tion, because I think what was men- I have time at the end, but we are get- represent either side. It does not make tioned on this floor was that the person ting down to the last 5 minutes of this a whit’s worth of difference to me. who has the largest financial interest discussion. What I care is that the lead plaintiff be may well have a conflict of interest, Mr. SARBANES. Mr. President, I ask selected in a way that is fair. the bill deals with that on page 100. unanimous consent that the Senator The fact of the matter is that the 1. Will not fairly and adequately protect from Colorado have 1 minute—I had 1 Banking Committee never held a hear- the interests of the class. minute—to make a point in response, ing on this and it shows up in the bill Now, that is one of the grounds in so the Senator from California can pre- 4 days before the markup. It is wrong which you can exclude someone, even serve her time in order to make her to legislate this way. I believe it is though they may have the largest fi- closing statement. elitist. nancial interest. The PRESIDING OFFICER. Without I pointed out to this Chamber last 2. Is subject to unique defenses that render objection, it is so ordered. The Senator night that if S. 240 had been law during such plaintiff incapable of adequately rep- from Colorado has an additional 1 the Keating case and the richest inves- resenting the class. minute. tor, or as my friend would prefer, the Both of those, Mr. President, would Mr. BROWN. Mr. President, I want to largest investor had been named lead apply as we have talked. thank the Senator from Maryland for plaintiff, it would have been someone The PRESIDING OFFICER. The Sen- his kindness. I simply want to join the who was guilty along with Keating, ator’s time has expired. Senator from Maryland to indicate someone who actually wound up paying The Senator from California has 7 that I think he has a valid point. If to make those—— minutes 52 seconds remaining. someone has a conflict of interest, ob- Mr. DODD. Will my colleague yield? Mr. SARBANES. Will the Senator viously that ought to be addressed. Mrs. BOXER. I will not yield at this yield me just 1 minute? I believe the plain language of the time. I have very little time. I ask my Mrs. BOXER. Certainly. bill on page 100 covers that: ‘‘will not friend from New Mexico if he wishes to The PRESIDING OFFICER. The Sen- fairly and adequately protect the inter- have a couple of minutes in this de- ator from Maryland is recognized for 1 est of the class.’’ I think that covers it. bate. I will reserve that for him. minute. But if there is better language or more Mr. SARBANES. Mr. President, I language, I want to assure him I will Mr. BINGAMAN. Mr. President, I will wish to say to the Senator from Colo- support it, and I will be glad to join respond that I would like a couple min- rado that my perception of the dispute him in that effort. utes to support the amendment by the that arose as between him and the Sen- But, Mr. President, the point re- Senator from California. ator from California was his taking mains, we are not dealing with dis- Mrs. BOXER. I say to my friend, how issue with her reference to the ‘‘rich- qualifications on that basis. What we much time do I have? est’’ plaintiff being named as the lead are dealing with is a whole new way to The PRESIDING OFFICER. The Sen- plaintiff under the bill. stack the deck, where someone with ator has 3 minutes. The Senator says, well, the word very few shares who brings the suit can Mrs. BOXER. I yield 2 minutes to my ‘‘richest’’ is not in the bill. That is cor- control the action and pick the attor- friend, and then I will conclude. rect. But what is in the bill is that the ney, and someone who has a lot more The PRESIDING OFFICER. The Sen- lead plaintiff shall be the one who has shares and yet not be as rich, as has ator from New Mexico. the largest financial interest, and in been used on this floor, will be closed Mr. BINGAMAN. Let me briefly say I that sense I think it is fair to say that out of the process. Stacking the deck is support the effort of the Senator from is the richest of the plaintiffs, the larg- the problem with this amendment. If California to amend the bill in this re- est financial interest. we eliminate that portion of it, I think gard. This provision, this most ade- Now, second, the Senator says, well, we would have something that all par- quate plaintiff idea, as I understand, we have covered the problem of a con- ties could work together on. was proposed as part of a substitute in flict of interest in the bill. That is a re- I yield back any remaining time. committee. There was no hearing held buttable presumption and, as someone The PRESIDING OFFICER. The Sen- on it. I believe that is the case. said last night, it is really written to ator’s time has expired. Who yields Mr. SARBANES. If I could say, the be almost irrebuttable. time? Senator is correct, there have been no June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9115 hearings on this issue. It was not con- would require courts to appoint as lead cern management of the case, and they sidered at any point until it appeared plaintiff the class member ‘‘most capa- do not authorize the court to require a in the draft. ble of adequately representing the in- plaintiff to serve as representative due Mr. BINGAMAN. Mr. President, I terests of the class member.’’ The bill to any perceived responsibility to the think one of the hallmarks of our legal sets up a rebuttable presumption that other class members or to anyone else. system has always been that a person’s the most adequate plaintiff is the per- The PRESIDING OFFICER. All time right to go to court or a person’s right son who has made such a motion, who has expired. to have his or her case presented in has the largest financial interest in the AMENDMENT NO. 1474 court should not be strictly tied to the relief sought by the class, and who sat- The PRESIDING OFFICER. Under person’s financial condition. We should isfies the requirements of rule 23 of the the previous order, the question now is not means test justice, as the saying Federal Rules of Civil Procedure. This on agreeing to amendment No. 1474, of- goes. presumption may be rebutted if a mem- fered by the Senator from Nevada [Mr. I think where you get a provision ber of the class proves that the pre- BRYAN]. The yeas and nays have been like this where there is a presumption sumptively most adequate plaintiff ordered. that the plaintiff who has the most in- will not fairly and adequately protect Mr. SARBANES addressed the Chair. vested is the most adequate plaintiff the interests of the class or is subject The PRESIDING OFFICER. The yeas and, therefore, should control the liti- to unique defenses. and nays have not been ordered. The gation, that comes very close to means What is the purpose of this provision? Senator from Maryland. testing justice. It causes me great con- Mr. DODD. This provision has two es- Mr. SARBANES. Mr. President, I be- cern that we would have this kind of a sential purposes. First, it will improve lieve under the procedure we are fol- provision. class member choice, by giving class lowing, the Senator has 1 minute to set Clearly, there have been groundless members an opportunity to request out his amendment; is that correct? lawsuits brought, and that is the pur- service as lead plaintiff. Second, it will The PRESIDING OFFICER. That is 2 pose. The purpose of this legislation is enhance a court’s ability to appoint as minutes for debate prior to the second to deal with that. I understand that. I lead plaintiff any class member who vote. support this legislation. I am a cospon- has requested service and who other- Mr. D’AMATO. I ask unanimous con- sor of this legislation, but when I co- wise meets the conditions of the provi- sent that there be 1 minute equally di- sponsored it, there was no provision in sion. vided for Senator BRYAN. it for most adequate plaintiff. Mr. BENNETT. Would this provision The PRESIDING OFFICER. Is there Now there is a presumption that require courts to name any institu- objection? Without objection, it is so those who have the most invested tional investor as lead plaintiff? ordered. should control the litigation. I do not Mr. DODD. No. Under the bill, a Mr. D’AMATO. I do not believe the know that that is always true. I do not court may only appoint a plaintiff who yeas and nays have been ordered. know that that should always be the has asked, in a motion to the court, to The PRESIDING OFFICER. The Sen- case. Therefore, I do have problems serve as lead plaintiff. Moreover, the ator is correct. with the bill as it now stands. institutional investor who asks to Mr. D’AMATO. I request the yeas and The PRESIDING OFFICER. The Sen- serve must satisfy the conditions of nays. ator’s 2 minutes have expired. rule 23, which authorizes the court to The PRESIDING OFFICER. Is there a Mrs. BOXER. I yield the Senator an- determine whether such a party should sufficient second? other 25 seconds. serve as representative plaintiff in There is a sufficient second. Mr. BINGAMAN. I will just say, the order to facilitate management of the The yeas and nays were ordered. Senator from California has made a case. The court also has to determine Mr. D’AMATO. As relates to the very good-faith effort to correct this. I that the party who asks to serve has Boxer amendment, have the yeas and support her efforts. I hope the Senate the largest financial interest in the re- nays have been ordered? will adopt her amendment. lief sought. Finally, the presumption The PRESIDING OFFICER. The yeas The PRESIDING OFFICER. The Sen- as to most adequate lead plaintiff and nays have not been ordered. ator has 43 seconds remaining. could be rebutted under the bill. Mr. D’AMATO. I request the yeas and Mrs. BOXER. Mr. President, I gave Mr. BENNETT. Would the bill re- nays. an example of if S. 240 was the law and quire any institutional investor to re- The PRESIDING OFFICER. Is there a who would be the lead plaintiff in the quest that its be appointed as lead sufficient second? Keating case. Let me give another ex- plaintiff? There is a sufficient second. ample. Mr. DODD. No. The bill merely gives The yeas and nays were ordered. The Wall Street Journal reported each class member the opportunity to The PRESIDING OFFICER. The Sen- last night that a Wall Street invest- request service. In no way does it obli- ator from Nevada is recognized. ment bank filed a class action suit gate any member to do so. Institu- Mr. BRYAN. Mr. President, I want to against Avon Products for securities tional and other investors would con- make this very clear. I have said it ad fraud. That Wall Street bank was sup- tinue to have the right simply to re- nauseam. The Bryan amendment has posed to represent the interest of small main class members and not serve as nothing to do with frivolous lawsuits. investors, but the Journal reported lead plaintiff, and they may select that The question is whether or not the that that Wall Street bank tried to get approach independent of any respon- Senate wants to go on record as toler- Avon to settle the case by giving them sibility to the other class members or ating, allowing, and permitting the $50 million to invest. That is the way to anyone else. conduct of aiders and abettors, whether they thought they would act in the Mr. BENNETT. Does this bill impose intentional, knowingly, or reckless, to best interest of the class. any new fiduciary duty on an institu- go unpunished. That is the state of the Now I say to my friends, this is ab- tional investor to its shareholders or law. surd. There is no way that small inves- beneficiaries, or to other class mem- This amendment would say that law- tors would have benefited from that bers, to request service as lead plain- yers, accountants, bankers, and others type of a settlement, and this bill tiffs? that aid and abet securities fraud will would prevent those small investors Mr. DODD. No. The bill imposes no be held liable. That was the law until from discovering the secret deal be- fiduciary or other obligation on insti- the Central Bank case was decided, and cause they would have to know about tutions or other plaintiffs to serve or the Supreme Court in deciding that it before they could use subpoenas. not to serve as lead plaintiffs. More- case made it clear that they were not I hope my colleagues will support the over, the court would have no author- saying that aiders and abettors ought Boxer-Bingaman amendment. ity to impose such an obligation. For not to be liable. They just very nar- Mr. BENNETT. Section 102 of the leg- example, rule 23 authorizes the court rowly interpreted the statute. We have islation would require courts to con- to make certain determinations about hit the plaintiffs’ lawyers for their friv- sider a motion by a purported class who should serve as representative olous actions, but how can we ignore member to become a lead plaintiff and plaintiff. These determinations con- the conduct of lawyers who counsel S 9116 CONGRESSIONAL RECORD — SENATE June 27, 1995 those perpetrating securities fraud? If [Rollcall Vote No. 286 Leg.] Mrs. BOXER. The Boxer-Bingaman we fail to adopt the Bryan amendment, YEAS—39 amendment says that after advertising we are simply saying to that group of Akaka Feingold Kohl for 90 days, all the plaintiffs get to se- lawyers that you can continue and be Baucus Feinstein Lautenberg lect the lead plaintiff. If they cannot free to continue your activities, and Biden Ford Leahy agree unanimously, then the judge will Boxer Glenn Levin that may cost literally hundreds of Bradley Graham McCain choose the lead plaintiff, taking into millions of dollars to innocent inves- Breaux Harkin Moynihan consideration all factors, including tors. Bryan Heflin Pryor conflicts of interest, who the largest Mr. D’AMATO. Mr. President, I yield Bumpers Hollings Robb Byrd Inouye Rockefeller investor is, et cetera. Just because 1 minute to Senator DODD. Cohen Jeffords Sarbanes someone is rich should not automati- Mr. DODD. Mr. President, very brief- Conrad Kennedy Shelby cally make them the lead plaintiffs. ly, what the Senator from Nevada is Daschle Kerrey Simon Support Boxer-Bingaman. Dorgan Kerry Wellstone doing here is raising a whole new The PRESIDING OFFICER. The Sen- standard that was never universally NAYS—60 ator from New York [Mr. D’AMATO] is the case prior to the Central Bank of Abraham Gorton Moseley-Braun recognized for 1 minute. Denver. Here, in the amendment, the Ashcroft Gramm Murkowski Bennett Grams Murray Mr. D’AMATO. Mr. President, our standard is knowing and reckless— Bingaman Grassley Nickles bill stops the kind of outrageous con- knowing or reckless. And to include Brown Gregg Nunn duct where the same handful of plain- recklessness here, a standard that is so Burns Hatch Packwood tiffs bring multiple complaints. Mr. vague the courts have had great dif- Campbell Hatfield Pell Chafee Helms Pressler Cooperman has been a plaintiff 14 ficulty defining it, would be to open up Coats Hutchison Reid times and has always chosen the same a whole new area of law and allow pro- Cochran Inhofe Roth law firm. portionate liability to be gutted as a Coverdell Johnston Santorum Craig Kassebaum Simpson Mr. Shore, 10 times, a professional result of this amendment. What we D’Amato Kempthorne Smith plaintiff. have done with this bill is, of course, DeWine Kyl Snowe Mr. Shields, seven times. allowed the SEC to bring a Govern- Dodd Lieberman Specter Mr. Steinberg, seven times. ment action in the aiding and abetting. Dole Lott Stevens Domenici Lugar Thomas William Steiner, six times. They be- Where you do have fraudulent intent, Exon Mack Thompson come the lead plaintiffs, they pick the joint and several applies. Propor- Faircloth McConnell Thurmond attorneys. Our legislation would pro- Frist Mikulski Warner tionate liability does not. In that case, hibit that. where you have even the casual con- ANSWERED ‘‘PRESENT’’—1 This legislation would give due def- duct of an aider and abettor, they Bond erence to lead the case to someone who would be trapped. We try to avoid when So the amendment (No. 1474) was re- has a real financial stake, not a phony you do not have that standard being jected. professional plaintiff. This amendment met, just a small mistake, which can Mr. D’AMATO. Mr. President, I move would keep alive that race to the be the case of a lawyer or accountant, to reconsider the vote. courthouse. That is why I urge a ‘‘no’’ In the process, should not be held fully Mr. DOMENICI. I move to lay that vote. accountable for the entire cost. So the motion on the table. The PRESIDING OFFICER. Does the adoption of this amendment would de- The motion to lay on the table was Senator yield the remainder of his stroy that very effort which is central agreed to. time? to this bill. So, for those reasons, be- Mr. D’AMATO. Yes. cause recklessness is used here—were AMENDMENT NO. 1475 The PRESIDING OFFICER. The this to be an actual knowledge—words The PRESIDING OFFICER. Under question occurs on the amendment of of art in describing that—I might have the previous order there will now be 2 the Senator from California. The yeas some different views on this amend- minutes equally divided for debate and nays have been ordered. ment. But the fact of it is, using the prior to the second vote, which will be The clerk will call the roll. recklessness standard, I think, takes on the Boxer amendment No. 1475. The this far beyond where we even were be- Senator will withhold until we have The bill clerk called the roll. fore—before the Supreme Court ruled order. The Senate will be in order. Mr. BOND (when his name was in the Central Bank of Denver case, The Senator from California [Mrs. called). Present. where certain courts in this land held BOXER] has 1 minute. The PRESIDING OFFICER (Mr. it to a much higher standard than Mr. FORD. Mr. President, the Senate THOMAS). Are there any other Senators recklessness. is still not in order. She deserves to be in the Chamber who desire to vote? So for that reason, I reluctantly urge heard. The result was announced—yeas 41, my colleagues to reject this amend- The PRESIDING OFFICER. The Sen- nays 58, as follows: ment. ate will be in order. The Senator from [Rollcall Vote No. 287 Leg.] Mr. D’AMATO. May I inquire? I did California. YEAS—41 Mrs. BOXER. Mr. President, very not know if the Senator from Califor- Akaka Ford Levin nia wanted to use her 1 minute now. briefly, if S. 240 as currently written Baucus Glenn McCain Mrs. BOXER. In between the votes, I had been the law then, the lead plain- Biden Graham Moynihan believe, is what the unanimous-consent tiff in the Keating case would have Bingaman Harkin Pell been one of the guilty parties in the Boxer Heflin Pryor says. I would prefer it before the next Bradley Hollings Robb vote, before the vote on the Boxer Keating case. That is because S. 240 Breaux Inouye Rockefeller amendment, which is what it said in says the judge must choose the largest Bryan Jeffords Roth Bumpers Kennedy investor as the lead plaintiff and the Sarbanes the unanimous-consent request. Byrd Kerrey Shelby Mr. D’AMATO. Fine. largest investor in the Keating case Conrad Kerry Simon turned out to be a party to the fraud. Daschle Kohl The PRESIDING OFFICER. The Specter Let us not allow this outrage. This Dorgan Lautenberg question is on agreeing to amendment Feingold Leahy Wellstone No. 1474 offered by Mr. BRYAN. ‘‘largest investor’’ language was added, The clerk will call the roll. without public hearings, 4 days before NAYS—58 The legislative clerk called the roll. markup. The SEC has problems with it. Abraham Coverdell Frist Mr. BOND (when his name was The Boxer-Bingaman amendment Ashcroft Craig Gorton Bennett D’Amato Gramm called). Present. says the following, that after advertis- Brown DeWine Grams The PRESIDING OFFICER. Are there ing for 90 days, all the plaintiffs—— Burns Dodd Grassley any other Senators in the Chamber de- The PRESIDING OFFICER. The Sen- Campbell Dole Gregg siring to vote? ator will withhold until we have order. Chafee Domenici Hatch Coats Exon Hatfield The result was announced—yeas 39, The Senate will be in order. Cochran Faircloth Helms nays 60, as follows: The Senator from California. Cohen Feinstein Hutchison June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9117 Inhofe Mikulski Simpson pened, I think as the Senator from New sider adopting or amending rules and regula- Johnston Moseley-Braun Smith York well recognizes, but we are will- tions of the Commission, or making legisla- Kassebaum Murkowski Snowe ing to forego the debate points in order tive recommendations, concerning— Kempthorne Murray Stevens (1) criteria that the Commission finds ap- Kyl Nickles Thomas to try to clean something out of the Lieberman Nunn propriate for the protection of investors by Thompson bill. There is still plenty wrong with it, which forward-looking statements concern- Lott Packwood Thurmond and I am going to address that when we ing the future economic performance of an Lugar Pressler Warner Mack Reid have the general debate on safe harbor. issuer of securities registered under section McConnell Santorum But I support this modification that is 12 of the Securities Exchange Act of 1934 will ANSWERED ‘‘PRESENT’’—1 being made in the bill, and I hope the be deemed not be in violation of section 10(b) of that Act; and Bond Senate will accept the amendment. The PRESIDING OFFICER. The (2) procedures by which courts shall timely So the amendment (No. 1475) was re- dismiss claims against such issuers of securi- question is on agreeing to the amend- jected. ties based on such forward-looking state- ment. Mr. D’AMATO. Mr. President, I move ments if such statements are in accordance Mr. D’AMATO. I am advised—and I to reconsider the vote. with any criteria under paragraph (1). mention this to my colleague and (b) COMMISSION CONSIDERATIONS.—In devel- Mr. SARBANES. I move to lay that friend—that there is another area of oping rules or legislative recommendations motion on the table. the bill that we will have to modify be- in accordance with subsection (a), the Com- The motion to lay on the table was cause it is referred to a second time. mission shall consider— agreed to. (1) appropriate limits to liability for for- But rather than do that at this point in ward-looking statements; AMENDMENT NO. 1476 time, I suggest that we go forward, and Mr. D’AMATO. Mr. President, I be- (2) procedures for making a summary de- then later on I will make that modi- termination of the applicability of any Com- lieve under the consent order my friend fication. mission rule for forward-looking statements and colleague from Maryland, Senator Mr. SARBANES. Why not go ahead? early in a judicial proceeding to limit pro- SARBANES, is to be recognized for the Mr. D’AMATO. On page 114, line 7, we tracted litigation and expansive discovery; purpose of offering an amendment. I delete the word ‘‘expectation’’ as well. (3) incorporating and reflecting the have asked him to give me the oppor- This was not done in the first. I ask scienter requirements applicable to implied private actions under section 10(b); and tunity—and if it looks like I am look- that the amendment be modified. ing around, I am, because staff was (4) providing clear guidance to issuers of The PRESIDING OFFICER. The securities and the judiciary. supposed to prepare an amendment amendment is so modified. (c) SECURITIES EXCHANGE ACT OF 1934.— dealing with the issue of safe harbor. The amendment, as modified, is as Title I of the Securities Exchange Act of 1934 And in that provision we call for know- follows: (15 U.S.C. 73a et seq.) is amended by insert- ingly, intent, and expectation. On page 121, line 1, delete the word ‘‘expec- ing after section 13 the following new sec- If I could have a copy of the bill it- tation,’’. tion: self, at page 121 of the bill it says, On page 114, line 7, delete the word ‘‘expec- ‘‘SEC. 37. APPLICATION OF SAFE HARBOR FOR ‘‘knowingly made.’’ These are state- tation,’’. FORWARD-LOOKING STATEMENTS. ments that are knowingly made with ‘‘(a) IN GENERAL.—In any implied private The PRESIDING OFFICER. The action arising under this title that alleges the expectation, purpose and actual in- question is on agreeing to the amend- that a forward-looking statement concerning tent of misleading investors. ment. the future economic performance of an is- There is a very real question as to So the amendment (No. 1476), as suer registered under section 12 was materi- what do we mean by ‘‘expectation,’’ modified, was agreed to. ally false or misleading, if a party making a and do we go too far? I do not believe Mr. D’AMATO. Mr. President, I move motion in accordance with subsection (b) re- it is a word that is necessary. I think it to reconsider the vote. quests a stay of discovery concerning the claims or defenses of that party, the court is gilding the lily, and for that purpose Mr. SARBANES. I move to lay that I would submit an amendment, the pur- shall grant such a stay until the court has motion on the table. ruled on the motion. pose of which is to delete the word ‘‘ex- The motion to lay on the table was ‘‘(b) SUMMARY JUDGMENT MOTIONS.—Sub- pectation,’’ so that it would then read: agreed to. section (a) shall apply to any motion for ‘‘knowingly made with the purpose and Mr. SARBANES. Mr. President, I summary judgment made by a defendant as- actual intent of misleading investors.’’ think under the order I am to be recog- serting that a forward-looking statement I ask unanimous consent that I nized at this point? was within the coverage of any rule which might be able to submit this amend- the Commission may have adopted concern- The PRESIDING OFFICER. The Sen- ing such predictive statements, if such mo- ment and have it considered at this ator is correct. time. tion is made not less than 60 days after the AMENDMENT NO. 1477 plaintiff commences discovery in the action. The PRESIDING OFFICER. Is there (Purpose: To amend the safe harbor ‘‘(c) DILATORY CONDUCT; DUPLICATIVE DIS- objection? Without objection, it is so provisions of the bill) COVERY.—Notwithstanding subsection (a) or ordered. Mr. SARBANES. Mr. President, I (b), the time permitted for a plaintiff to con- The clerk will report the amendment. duct discovery under subsection (b) may be send an amendment to the desk and The bill clerk read as follows: extended, or a stay of the proceedings may ask for its immediate consideration. be denied, if the court finds that— The Senator from New York [Mr. D’AMATO] The PRESIDING OFFICER. The proposes an amendment numbered 1476: ‘‘(1) the defendant making a motion de- On page 121, line 1, delete the word ‘‘expec- clerk will report. scribed in subsection (b) engaged in dilatory tation,’’. The bill clerk read as follows: or obstructive conduct in taking or opposing any discovery; or The Senator from Maryland [Mr. SAR- Mr. D’AMATO. Mr. President, I have ‘‘(2) a stay of discovery pending a ruling on BANES], for himself and Mr. LAUTENBERG, no illusions. I recognize that this a motion under subsection (b) would be sub- proposes an amendment numbered 1477. amendment does not answer all those stantially unfair to the plaintiff or to any questions or go as far as some might Mr. SARBANES. Mr. President, I ask other party to the action.’’. like. But I certainly think it clears up unanimous consent that reading of the Mr. SARBANES. Mr. President and something that would raise a question amendment be dispensed with. Members of the Senate, this is the and is a move in the right direction, The PRESIDING OFFICER. Without issue of safe harbor. I know many and I urge its adoption. objection, it is so ordered. Members have heard about this issue. Mr. SARBANES. Mr. President, I The amendment is as follows: In my judgment, it is an extremely im- welcome the amendment from the Sen- Beginning on page 112, strike line 1 and all portant issue which we now seek to de- ator from New York. We spoke earlier that follows through page 126, line 14, and in- velop. We have actually addressed five about introducing it at this point sert the following: major issues in this bill: Joint and sev- ahead of the general debate on safe SEC. 105. SAFE HARBOR FOR FORWARD-LOOKING eral liability, statute of limitations, STATEMENTS. harbor. I am quite amenable to that be- (a) CONSIDERATION OF REGULATORY OR LEG- aiding and abetting, and safe harbor, cause I want to get a substantive re- ISLATIVE CHANGES.—In consultation with in- and the lead plaintiff amendment that sult. This provision was going to be a vestors and issuers of securities, the Securi- was offered by my distinguished col- part of the debate had this not hap- ties and Exchange Commission shall con- league from California. S 9118 CONGRESSIONAL RECORD — SENATE June 27, 1995 Now, Mr. President, this is an ex- provements in existing safe harbor pro- work that the Commission has already in- tremely important amendment. It is a visions. He talks about the need to get vested in the subject, my recommendation very complex issue and some very able accurate forward projections, but he would be that you provide broad rulemaking people have worked very hard to under- also talks about the need to protect in- authority to the Commission to improve the safe harbor. stand it and try to address it. I hope to vestors. develop it here over a reasonably short Mr. President, I ask unanimous con- He then goes on to address consider- period. sent that the full letter be printed in ations if the committee tries to put in This amendment that I have sent to the RECORD at the end of my remarks. a legislative standard, instead of hav- the desk, this particular amendment, The PRESIDING OFFICER. Without ing a regulatory safe harbor. I think does not try to define in the statute objection, it is so ordered. Chairman Levitt was absolutely right. the standard for safe harbor. That may (See exhibit 1.) That is obviously what Senators DODD come later. What this amendment Mr. SARBANES. Mr. President, I am and DOMENICI thought when they put in seeks to do is simply to put into this quoting: their bill. I do not know how many bill the provision on the issue of safe A carefully crafted safe harbor protection other people who cosponsored that bill harbor that was in the bill introduced for meritless private lawsuits should encour- agreed that, in effect, giving this as- by Senator DODD and Senator DOMEN- age public companies to make additional for- signment to the Securities and Ex- ICI. ward looking disclosure that would benefit change Commission was the way to do I want to say to my colleagues who investors. At the same time, it should not it. As Chairman Levitt said: sponsored that bill that this amend- compromise the integrity of such informa- Given these complexities and in light of tion which is vital to both investor protec- ment is the provision you cosponsored. the enormous amount of care, thought and tion and the efficiency of the capital mar- work that the Commission has already in- The provision that is in the bill before kets, the two goals of the Federal securities us dealing with safe harbor is not the vested in the subject, my recommendation law. would be that you provide broad rulemaking provision that was in the bill which Later he says, and I quote him: authority to the Commission to improve the you cosponsored. A safe harbor must be balanced. It should safe harbor. Some may say, ‘‘Well, that’s all encourage more sound disclosure without en- That is not what was done. The pro- right, I want the provision that’s in couraging either omission of material infor- vision that was in the original bill, this bill.’’ But others may not say that. mation or irresponsible and dishonest infor- which is the amendment that is at the Every Member should understand that mation. desk, was dropped from the bill and in- the provision that was in the bill which Let me repeat that: stead a legislative standard was sub- they cosponsored—a significant num- A safe harbor must be balanced. It should stituted. ber of Members cosponsored—is the encourage more sound disclosure without en- The provision that was in the bill provision that is in the amendment at couraging either omission of material infor- that is on Members’ desks, the original the desk. That is the safe harbor provi- mation or irresponsible and dishonest infor- bill, is at page 19 through 22, and those sion that people signed on to. mation. pages, as Members can all see, have And what Senator DODD and Senator A safe harbor must be thoughtful so that it been stricken. That is what Members DOMENICI had done is, in effect, create protects considered projections but never a regulatory safe harbor. They had fraudulent ones. A safe harbor must also be originally signed on to, and that provi- placed the burden, as it were, on the practical. It should be flexible enough to ac- sion has been, as you can see, lined out commodate legitimate investor protection in this bill, and instead an effort has Securities and Exchange Commission concerns that may arise on both sides of the to come up with a definition of safe been made for this body to define the issue. standard in an extremely complex mat- harbor, and it set out certain standards This is a complex issue in a complex indus- ter. As Chairman Levitt said: by which the Commission would be try and it raises almost as many questions as governed. it answers. Should the safe harbor apply to The one thing I can state unequivocally is This is an extremely important mat- information required by Commission rule, that this subject eludes easy answers. ter. It is one about which the Chairman including predictive information contained We have just seen an example of that. of the Commission is very much con- in the financial statements, for example, My distinguished colleague from New pension liabilities and over-the-counter de- York, just before I offered this amend- cerned. And I submit to my colleagues, rivatives? Should it extend to oral state- at some point in this legislative proc- ments? Should there be a requirement that ment, got up to offer an amendment to ess, Members ought to stop, look and forward looking information that has be- amend the standard that is in the bill. listen and ask themselves whether they come incorrect be updated if the company or In other words, here we are, they are want to continue to be at variance or its insiders are buying or selling securities? conceding that the standard in the bill at odds with very strongly held opin- Should the safe harbor extend to disclosures goes too far and needs to be corrected, ions of the regulators, of the Chairman made in connection with a capital raising so we just amended it. I indicated I of the SEC, of the States securities reg- transaction on the same basis as more rou- welcome that amendment because I tine disclosures as well? Are there categories think this standard that is in the bill, ulators, particularly in a matter as dif- of transactions, such as partnership offerings ficult and as complex as the safe har- or going private transactions, that should be even with the amendment, is an im- bor issue. subject to additional conditions? proper standard. But the fact that the The regulators disagree with a ma- There are many more questions that have amendment was offered is a demonstra- jority of this body on the statute of arisen in the course of the Commission’s ex- tion of the point I am trying to make limitations issue, but the statute of ploration of how to design a safe harbor. We about the complexity of this issue and limitations issue is a relatively easily have issued a concept release, received a the wisdom of the original approach to, understood issue. The question was, are large volume of comment letters in response in effect, charge the Commission with and held 3 days of hearing, both in California the responsibility of defining the safe you going to have 1 and 3 years, or 2 and Washington. In addition, I have met per- and 5 years? That is not the safe harbor sonally with most groups that might con- harbor provision, a matter which the issue. ceivably have an interest in the subject—cor- chairman has indicated he was, in fact, On May 19, the Chairman of the Secu- porate leaders, investment groups, plaintiffs working on. Now, as people who were rities and Exchange Commission wrote lawyers, defense lawyers, State and Federal here just a few minutes ago noted, not to the Banking Committee a four-page regulators, law professors and even Federal only was it amended, but then my dis- letter entirely devoted to the safe har- judges. tinguished colleague from New York bor issue. Only the safe harbor issue The one thing I can state unequivocally is neglected to amend another section of that this subject eludes easy answers. was discussed in that four-page letter. the bill which also needed to be amend- The letter itself is complex, let alone Let me repeat that last statement. ed. So you get some sense of how we the issue. The letter reflects the com- This is Chairman Levitt: are dealing with a very difficult issue. plexity of the issue. The one thing I can state unequivocally is Here we are trying to jury-rig it at the In that letter, the Chairman states that this subject eludes easy answers. last minute. Now, later, if I have to, I his interest in trying to have changes Then he goes on to say: will try to deal with the legislative in the securities litigation issue. He Given these complexities and in light of standard, but I think that fools are concedes that he would like to see im- the enormous amount of care, thought and rushing in where angels fear to tread, June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9119 with all due respect to my colleagues. the Securities and Exchange Commis- Now, that bill contained in it this This is a matter that ought to be put sion said, ‘‘I cannot embrace proposals charge to the SEC, which is in the to the Securities and Exchange Com- which allow willful fraud to receive the amendment that is at the desk, I say to mission, just as Senators DODD and DO- benefit of safe harbor protection.’’ my distinguished colleagues. This MENICI proposed in their initial legisla- Mr. DOMENICI. Will the Senator amendment is your language, ver- tion. yield for a question? batim, from the bill as you introduced On May 19, Chairman Levitt wrote Mr. SARBANES. Certainly. it and the bill which a lot of Members the Banking Committee a four-page Mr. DOMENICI. Does not the safe cosponsored. letter on safe harbor only. This safe harbor provision do just that—make The SEC put out their concept re- harbor is a catastrophe waiting to hap- sure that willful fraud is still covered, lease on safe harbor on October 13, 1994. pen. And Members must keep in mind expressly stating that the safe harbor Let me just read the summary of their the danger that the safe harbor is does not apply to knowing fraud? concept release and notice of hearing: going to become a haven for pirates. As Mr. SARBANES. I say to the Senator The Securities and Exchange Commission I have said earlier, it will turn into a that I do not believe it does so. is soliciting comment on current practices pirate’s cove. That is where they will Mr. DOMENICI. I do not know what relating to disclosure of forward-looking in- shield themselves in order to really else we can put in. formation. In particular, the Commission seeks comment on whether the safe harbor perpetrate some egregious frauds on Mr. SARBANES. That is why Chair- man Levitt wrote the letter. He read provisions for forward-looking statements the investing public. set forth in rule 175 under the Securities Act Subsequent to the letter of May 19 the provision in the bill. Mr. DOMENICI. He wrote the letter of 1933, rule 3b–6 under the Securities Ex- from the Chairman of the Securities change Act of 1934, rule 103(a) under the Pub- and Exchange Commission, the major- about a lot of other issues besides that. lic Utility Holding Company Act of 1935, and ity within the Banking Committee, in- We addressed his concerns about willful rule 0–11 under the Trust Indenture Act of cluding the sponsors of the earlier bill, fraud. We have knowledge and intent, 1939 are effective in encouraging disclosure departed from their approach in terms which exempt people from the safe har- of voluntary forward-looking information and protecting investments, or, if not, of charging the Commission with the bor. Mr. SARBANES. This letter was should be revised, and if revised, how? responsibility of developing a safe har- written the morning of the markup and The Commission also seeks comment on bor. I mean, the Commission are the was directed to the very provision in various changes to the existing safe harbor experts, they can hold the hearings, provisions that have been suggested by cer- the bill, as brought out of the commit- and I will discuss in a minute the hear- tain commentators. Finally, the Commission tee. Senator Levitt wrote an earlier ings they held in trying to resolve this is announcing that public hearings will be letter, which I quoted from earlier. I do matter. But a majority decided that, held beginning February 13, 1995, to consider not know if the Senator was on the well, no, they were going to do a legis- these issues. floor. They went on to say: lative standard. Mr. DOMENICI. He is not a Senator Efforts began to develop an appro- Comments should be received on or before yet, is he? Arthur Levitt is not a Sen- priate legislative standard in discus- January 11, 1995. Public hearings will begin ator. sions with the SEC and others and with at 10 a.m. on February 13, 1995. Those who Mr. SARBANES. Chairman Levitt. wish to testify at the hearings must notify members of the committee on both Mr. DOMENICI. I wanted to correct the Commission in writing of their intention sides, including those of us that are the RECORD. to appear on or before December 31, 1994. now opposing this legislation. But the Mr. SARBANES. I am not sure who So the Commission is moving to try end result of that discussion, unfortu- to apologize to about that. to develop a safe harbor. I think it nately, was an inability to come to an Mr. DOMENICI. Just to clear up the moved relatively promptly after it saw agreement. The definition, the stand- RECORD. this signal of, in effect, charging them ard in the bill I think is just fraught Mr. SARBANES. I will not try to with this mandate. with danger. In fact, it was just amend- reach a conclusion, but I do lay out a The Commission received 150 re- ed by the proponents of this legislation general apology for anyone who may sponses on the safe harbor issue. That here on the floor only a moment or two have been offended by it. There may be is more witnesses, by far, more wit- ago. They took out one element of it differing views of the matter. nesses by far, than the Banking Com- right here, obviously recognizing them- But Chairman Levitt wrote an earlier mittee has heard from on all securities selves the deficiencies in it. That illus- letter, which I quoted from at some litigation issues. The Banking Com- trates the problem with this body try- length. At one point, it looked like mittee hearings with respect to the ing to formulate a legislative standard. maybe, if we were going to do a statu- safe harbor were eclipsed by the SEC. I welcome that substantive change, tory definition, we might be able to ar- The SEC held public hearings, 2 days but I do think it illustrates, in a rather rive at an appropriate one. That did in Washington, February 13 and Feb- demonstrative way, the problem with not work. The comment I just quoted ruary 14. Then a day in California on this body trying to write the legisla- is what he had to say about the provi- February 16. tive standard rather than letting the sion that is in the bill. This came to us At those public hearings they had 62 SEC do it. Now, if we have to write it, on the morning of the markup. witnesses in all. Venture capitalists, I will try to do it, but I think it is a Now, the Dodd-Domenici bill—and I law professors, corporate executives, mistake. This is an opportunity for must say to my two colleagues that plaintiff’s lawyers, defense lawyers, in- Members, in effect, to go back to the had we stuck with your bill, the num- stitutional investors. provision that was in the bill. ber of issues in dispute here on the Mr. President, these are the hearing Let me read what Chairman Levitt floor would have been fewer. There still records of the SEC with respect to the said about the provision that was in would have been some. matter of safe harbor for forward-look- the markup document. In other words, Your bill also had in it the statute of ing statements. after this week of working, the com- limitations issue, and it had an ap- Now, I submit to my colleagues that mittee moved with a document that proach on safe harbor which I think it is—I do not want to say sheer folly, had this definition, and this is what was acceptable, which left us, of because at some point we may have to the Chairman said: course, with the joint and several, on try to work out a legislative stand- As Chairman of the Securities and Ex- which there is, I think, a sharp dif- ard—but it is certainly imprudent con- change Commission— ference in perception and philosophy. I duct, at the least, to be trying to de- This letter came on the morning of recognize that. And there is the aiding velop a standard here instead of allow- the markup. and abetting issue. ing the Securities and Exchange Com- I cannot embrace proposals which allow will- But the bill was introduced in the mission to develop the standard, which ful fraud to receive the benefit of safe harbor last Congress on March 24, 1994. I be- was recognized by the original sponsors protection. lieve I am correct. If I am in error of this legislation. And then he discussed the problems about that, I hope the two cosponsors I assume they will argue, ‘‘Well, the that he saw with the provision that is will correct me, both of whom are here Commission had not done it, and there- in this legislation. The Chairman of on the floor. fore we are going to go ahead and do S 9120 CONGRESSIONAL RECORD — SENATE June 27, 1995 it.’’ The fact is, the Commission is EXHIBIT 1 the integrity of such information which is working to do it and trying to struggle U.S. SECURITIES AND vital to both investor protection and the effi- through some very difficult and com- EXCHANGE COMMISSION, ciency of the capital markets—the two goals of the federal securities laws. plex issues as the Chairman of the Washington, DC, May 19, 1995. The safe harbor contained in H.R. 1058 is so Commission has stated. Hon. ALFONSE M. D’AMATO, Chairman, Committee on Banking, Housing, broad and inflexible that it may compromise He set out a number of questions and Urban Affairs, U.S. Senate, Washing- investor protection and market efficiency. It which I read earlier, and I defy any ton, DC. would, for example, protect companies and Member of this body to take those DEAR MR. CHAIRMAN: As Chairman of the individuals from private lawsuits even where the information was purposefully fraudulent. questions and go through them and Securities and Exchange Commission I have no higher priority than to protect American This result would have consequences not give me an easy answer to them. Not investors and ensure an efficient capital for- only for investors, but for the market as only do I defy the Members, I defy mation process. I know personally just how well. There would likely be more disclosure, their staffs to go through it, to go deeply you share these goals. In keeping but would it be better disclosure? Moreover, through those questions and work with our common purpose, both the SEC and the vast majority of companies whose public through them—the ones that the the Congress are working to find an appro- statements are published in good faith and Chairman outlined in his letter; of priate ‘‘safe harbor’’ from the liability provi- with due care could find the investing public skeptical of their information. course, there are many others, as he in- sions of the federal securities laws for pro- jections and other forward-looking state- I am concerned that H.R. 1058 appears to dicated—and give me an easy response. ments made by public companies. Several cover other persons such as brokers. In the As the Chairman pointed out, ‘‘A safe pieces of proposed legislation address the Prudential Securities case, Prudential bro- harbor must be balanced. It should en- issue of the safe harbor and the House-passed kers intentionally made baseless statements concerning expected yields solely to lure courage more sound disclosure without version, H.R. 1058, specifically defines such a safe harbor. customers into making what were otherwise encouraging either omission of mate- Your committee is now considering securi- extremely risky and unsuitable investments. rial information, or irresponsible and ties litigation reform legislation that will Pursuant to the Commission’s settlement dishonest information.’’ include a safe harbor provision. Rather than with Prudential, the firm has paid compensa- tion to its defrauded customers of over $700 Actually, Chairman Levitt and oth- simply repeat the Commission’s request that Congress await the outcome of our rule- million. Do we really want to protect such ers recognize the need to have more making deliberations and thereby run the conduct from accountability to these de- disclosure of information. That is a de- risk of missing an opportunity to provide frauded investors? In the past two years or sirable objective. The question is, what input for your own deliberations, I thought I so, the Commission has brought eighteen en- safeguards do we have to ensure that would take this opportunity to express my forcement cases involving the sale of more this disclosure of information is not personal views about a legislative approach than $200 million of interests in wireless going to set people up to be exploited to a safe harbor. cable partnerships and limited liability com- panies. Most of these cases involved fraudu- in fraudulent schemes? There is a need for a stronger safe harbor than currently exists. The current rules have lent projections as to the returns investors Chairman Levitt went on to say, ‘‘A largely been a failure and I share the dis- could expect from their investments. Pro- safe harbor must be thoughtful so that appointment of issuers that the rules have moters of these types of ventures would be it protects considered projections but been ineffective in affording protection for immune from private suits under H.R. 1058 as would those who promote blank check offer- never fraudulent ones. A safe harbor forward-looking statements. Our capital markets are built on the foundation of full ings, penny stocks, and roll-ups. It should must also be practical. It should be and fair disclosure. Analysts are paid and in- also address conflict of interest problems flexible enough to accommodate legiti- vestors are rewarded for correctly assessing that may arise in management buyouts and mate investor protection concerns that a company’s prospects. The more investors changes in control of a company. may arise on both sides of the issue. know and understand management’s future A safe harbor must be balanced—it should This is a complex issue and a complex plans and views, the sounder the valuation is encourage more sound disclosure without en- industry. It raises almost as many of the company’s securities and the more ef- couraging either omission of material infor- questions as one answers.’’ ficient the capital allocation process. Yet, mation or irresponsible and dishonest infor- corporate America is hesitant to disclose mation. A safe harbor must be thoughtful— He then details some of those ques- projections and other forward-looking infor- so that it protects considered projections, tions, and then goes on to say, ‘‘There mation, because of excessive vulnerability to but never fraudulent ones. A safe harbor are many more questions that have lawsuits if predictions ultimately are not re- must also be practical—it should be flexible arisen in the course of the Commis- alized. enough to accommodate legitimate investor protection concerns that may arise on both sion’s exploration of how to design a As a businessman for most of my life, I know all too well the punishing costs of sides of the issue. This is a complex issue in safe harbor. We have issued a concept meritless lawsuits—costs that are ultimately a complex industry, and it raises almost as release, received a large volume of paid by investors. Particularly galling are many questions as one answers: Should the comment letters and response, and held the frivolous lawsuits that ignore the fact safe harbor apply to information required by 3 days of hearings, both in California that a projection is inherently uncertain Commission rule, including predictive infor- and Washington. In addition, I have even when made reasonably and in good mation contained in the financial state- met personally with most groups that faith. ments (e.g. pension liabilities and over-the- might conceivably have an interest in This is not to suggest that private litiga- counter derivatives)? Should it extend to tion under the federal securities laws is gen- oral statements? Should there be a require- the subject. Corporate leaders, investor erally counterproductive. In fact, private ment that forward-looking information that groups, plaintiff’s lawyers, defense law- lawsuits are a necessary supplement to the has become incorrect be updated if the com- yers, State and Federal regulators, law enforcement program of the Commission. We pany or its insiders are buying or selling se- professors, and even Federal judges. have neither the resources nor the desire to curities? Should the safe harbor extend to The one thing I can state unequivo- replace private plaintiffs in policing fraud; it disclosures made in connection with a cap- cally, is that this subject eludes easy makes more sense to let private forces con- ital raising transaction on the same basis as answers.’’ tinue to play a key role in deterrence, than more routine disclosures as well? Are there to vastly expand the Commission’s role. The categories of transactions, such as partner- He then goes on to state his basic relief obtained from Commission ship offerings or going private transactions conclusion, which is, ‘‘Given these disgorgement actions is no substitute for pri- that should be subject to additional condi- complexities and in light of the enor- vate damage actions. Indeed, as government tions? mous amount of care, thought, and is downsized and budgets are trimmed, the There are many more questions that have work that the Commission has already investor’s ability to seek redress directly is arisen in the course of the Commission’s ex- likely to increase in importance. ploration of how to design a safe harbor. We invested in the subject, my rec- To achieve our common goal of encourag- have issued a concept release, received a ommendation would be that you pro- ing enhanced sound disclosure by reducing large volume of comment letters in response, vide broad rulemaking authority to the the threat of meritless litigation, we must and held three days of hearings, both in Cali- Commission to improve the safe har- strike a reasonable balance. A carefully fornia and Washington. In addition, I have bor.’’ crafted safe harbor protection from meritless met personally with most groups that might private lawsuits should encourage public conceivably have an interest in the subject: Mr. President, that is what the companies to make additional forward-look- corporate leaders, investor groups, plaintiff’s amendment at the desk does. I urge its ing disclosure that would benefit investors. lawyers, defense lawyers, state and Federal adoption. I yield the floor. At the same time, it should not compromise regulators, law professors, and even Federal June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9121 judges. The one thing I can state unequivo- vided, and then going to a vote on the cluded. And of course any company cally is that this subject eludes easy an- amendment. that has recently committed a viola- swers. Mr. BENNETT. Mr. President, I tion of the antifraud provisions of the Given these complexities—and in light of the enormous amount of care, thought, and would like to confer with the chairman securities laws cannot sail into the work that the Commission has already in- of the Banking Committee before harbor. vested in the subject—my recommendation agreeing to that. I have no personal ob- Those kinds of restrictions are al- would be that you provide broad rulemaking jection to it. I would think we ought to ready out there. So the safe harbor is authority to the Commission to improve the bring Senator D’AMATO into the discus- not for the pirates. It is for the people safe harbor. If you wish to provide more sion. who do not fall into those categories. specificity by legislation, I believe the provi- Mr. SARBANES. Fine. I was not Now, for those in the harbor, they sion must address the investor protection aware of this request until I just heard have some requirements written into concerns mentioned above. I would support it. I do think we should have some time legislation that sets forth a basic safe harbor the bill. They must clearly state that containing four components: (1) protection after the caucus on the debate—after any projection they are making is, in from private lawsuits for reasonable projec- the conference luncheon. fact, a statement about the future, and tions by public companies; (2) a scienter Mr. BENNETT. Mr. President, I pro- they must clearly state, here in the standard other than recklessness should be pound a unanimous-consent request words of the bill, ‘‘The risk that actual used for a safe harbor and appropriate proce- that the time between now and 12:30 be results may differ materially from dural standards should be enacted to discour- equally divided on this issue, and leave such projections, states, or descrip- age and easily terminate meritless litiga- the unanimous-consent request as to tions.’’ tion; (3) ‘‘projections’’ would include vol- the exact time of the vote for a later untary forward-looking statements with re- In other words, there is not a risk spect to a group of subjects such as sales, request. that we might be off a day or two. revenues, net income (loss), earnings per The PRESIDING OFFICER. Without There is not a risk that we might be off share, as well as the mandatory information objection, it is so ordered. a penny or two. There is a risk that the Mr. BENNETT. Mr. President, I have required in the Management’s Discussion actual results may differ materially heard the Senator from Maryland talk and Analysis; and (4) the Commission would from the projections or estimates. have the flexibility and authority to include at great length about all of the hear- Then, of course, we have the language or exclude classes of disclosures, trans- ings and the comments and the legal that the bill does not permit companies actions, or persons as experience teaches us aspects of this. to take advantage of the safe harbor if lessons and as circumstances warrant. Once again, I would like to talk As we work to reform the current safe har- they act with ‘‘the purpose and actual about it from the standpoint of the bor rules of the Commission, the greatest intent of misleading investors.’’ This is chief executive officer, struggling to problem is anticipating the unintended con- the language of the bill that we have maintain the investor confidence in his sequences of the changes that will be made before us. in the standards of liability. The answer ap- company, and bring an appropriate re- pears to be an approach that maintains flexi- turn to investors, and talk about how Those are the requirements in this bility in responding to problems that may this safe harbor circumstance would particular harbor; those that prevent develop. As a regulatory agency that admin- actually work. people from coming in in the first place isters the Federal securities laws, we are A chief executive officer, having been and those who govern the people who well situated to respond promptly to any are there. problems that may develop, if we are given one, sees dozens, maybe hundreds, of memorandum, every week. He engages Let me explain why it is important the statutory authority to do so. Indeed, one that we not further lower the threshold possibility we are considering is a pilot safe in any number of conversations with harbor that would be reviewed formally at individuals in the company in any that we have established with the the end of a two year period. What we have given week about any particular sub- words ‘‘purpose’’ and ‘‘actual intent of today is unsatisfactory, but we think that, ject. That is the fact against which I misleading investors.’’ Here is how with your support, we can expeditiously want to paint the picture of how this things work in an actual company, as I build a better model for tomorrow. say speaking from experience as a chief I am well aware of your tenacious commit- thing works. We have been having this discussion executive officer. You gather all of ment to the individual Americans who are your people around you. You look at the backbone of our markets and I have no about weakening a standard, safe har- doubt that you share our belief that the in- bor; where should the threshold be? I the memos and the other reports that terests of those investors must be held para- think the issue comes down, do we come out, and you inevitably find that mount. I look forward to continuing to work want a safe harbor or not? If we want there is a difference of opinion about with you on safe harbor and other issues re- one, it has to be safe, or we should not just about everything going on in your lated to securities litigation reform. go through the exercise. company. Let us talk about a new Thank you for your consideration. product. Sincerely, Now, the opponents have suggested Some of your people say to you, ‘‘Oh. ARTHUR LEVITT. that the safe harbor in the bill is, in Our product, product X, will be avail- Mr. BENNETT. Mr. President, I ask fact, a pirate’s cove. able right on schedule in August. You the Senator from Maryland to pay at- Let me list, Mr. President, the pi- can depend on it. You can take it to tention closely to this since it concerns rates who are not welcome in this cove. the bank.’’ Others will say, ‘‘No. We him directly. That is, the pirates who would be de- are a little worried. We may not make I ask unanimous consent that the nied the right to sail into this particu- it in August. We have this problem. We vote occur on or in relation to the Sar- lar harbor, by the bill. have that problem. Our supplier may banes amendment No. 1477 at 2:15 today A blank check company, a blind in- not come through. We may miss the and that the time between the begin- vestment pool that does not tell any- target date.’’ You are the chief execu- ning of the debate and 2:15 be equally body how they invest, a penny stock tive officer. You have to decide. You divided in the usual form. company, a rollup transaction, a going Mr. SARBANES. Reserving the right private transaction. Not to imply these have a meeting coming up with a group to object, first of all, could I inquire of people are pirates, but they could not of security analysts, and they are the Chair, what is the time situation? get into the cove. A mutual fund. It is going to ask you point blank, ‘‘When The PRESIDING OFFICER. We began very significant that that is on the list will product X be on the market?’’ You consideration of this amendment at because that is where most of the sen- want to give them the very best infor- 11:09. iors invest their money. They do not go mation you can. Mr. SARBANES. So the Senator has out and individually pick stocks unless So you sift through all of this and ul- used 30 minutes. they have some experience at that. timately you have to make a decision. The PRESIDING OFFICER. Thirty- They buy a mutual fund. A mutual And you decide based on the track five. fund cannot come into this particular record of the people who are advising Mr. SARBANES. Mr. President, I am harbor. A limited partnership. A tender you that you think product X is a pret- agreeable to dividing the time between officer. Anyone filing certain owner- ty good bet to be on line in August just now and 12:30 equally, and then having ship reports with the SEC. Or informa- as you anticipated it would. You go be- half an hour after lunch, equally di- tion in the financial statements is ex- fore the analyst meeting. And they say S 9122 CONGRESSIONAL RECORD — SENATE June 27, 1995 to you, ‘‘When will product X be avail- Discovery: That great word in the edge but he acted with the purpose and able?’’ You say, ‘‘Well, it is my best legal lexicon; discovery starts, and it actual intent of misleading investors. judgment that it will be available in goes to every piece of paper that has to Now that no one can tolerate. That August. I have to qualify that by say- do with product X, and every memo- clearly must not be allowed. But it ing that is my estimate. I tell you randum that may have crossed the must be the purpose and actual intent there are some people in the company CEO’s desk. And they find the memo of misleading investors before the CEO who do not think it will be available in from the fellow who says, ‘‘I don’t is driven out of the harbor. August. But the best I can tell, my think we are going to be ready in Au- Why actual intent? Because without guess, my prediction, is that we will gust.’’ And, bingo, we have a smoking it intent can be implied in a number of deliver product X in August.’’ He can gun. No reference is made to the other circumstances. ‘‘You saw this memo, maybe put some other caveats in. You opinions now. In court the reference is the very fact that you decided to ig- know, this is very sophisticated. The all going to hammer in on this one nore it in your presentation to the se- analysts do not hear any of that. They fateful memo, and, ‘‘Mr. CEO, did you curity analyst, Mr. CEO, implies that are like pollsters. ‘‘Who is ahead? Who read this memo?’’ If, he says yes, he you intended to deceive them.’’ No. is going to win the election?’’ ‘‘No. We not only has knowledge that product X The standard must be higher than that. want to know what your numbers say was not going to come in, he has actual You must prove that he had the actual right now.’’ And they do not listen to knowledge, not just imputed knowl- intent, that he had the purpose of de- the caveats. The CEO can put in all the edge, actual knowledge. He admits he ceiving investors before you drag him caveats he wants. But they are going to read the memo. Nail him to the wall. into that area. walk away saying, ‘‘He predicted that That is what happens if he does not Is this a high threshold? I think it is is going to come out in August.’’ have the safe harbor that we have writ- an appropriate threshold because it fits Now we get to August. What hap- ten into this act. Let us assume that the reality of the circumstances, and it pens? Any one of a number of things this company is not one of those that prevents plaintiffs from accusing com- happens. Frankly, they do not have to is kept out of the harbor, the list I read panies and officers of committing fraud be the kinds of things projected in the in the beginning. It is one of those that simply because documents of differing memo that the division manager who is allowed into the harbor and without opinions exist somewhere in the file. said it might not happen in August in- the harbor that is what happens. You have to go beyond that. You have cluded. There could be a hurricane in Now suppose we have the reckless to prove actual intent. Florida where one of your suppliers is standard that people have argued for. If I may stray into waters that I and the supplier cannot provide the This would be a very easy standard for probably should not, since I have not parts that you were depending on. a plaintiff’s lawyer to meet in the cir- gone to law school, but I have had There was no way you could predict cumstance I have described. Arguably some experience in this area, it is a lit- that. There are any number of things any projection about the future is tle like the standards that we apply in that could have happened. But you get reckless. ‘‘You do not know, Mr. CEO, the first amendment. to August, and the company puts out a that the future is going to produce this If a newspaper inadvertently prints press release saying product X has been product in August. It was reckless of something that is inaccurate, they can- delayed and will not be introduced you to say that you would have it in not be held for libel unless it is proven until sometime later in the fall. August. You may have believed it but that they acted with malice, with ac- Bang—the analysts pound the stock. it was a reckless statement.’’ There is tual intent, if you will, to harm the There is wild speculation. I have seen no protection for the CEO in this cir- reputation of the individual. Thus free those. We have all seen those. They go cumstance with the term ‘‘reckless.’’ speech is allowed to go forward through the marketplace—all kinds of No. He needs the safe harbor of the bill. unimpeded, however damaging it is to rumors, the company has serious prob- And the question is how safe should the individual involved. Having been lems, their management is in dif- that harbor be? Well, if we had the sim- the individual involved in some cir- ficulty, so and so is going to get fired, ple knowledge standard that the SEC cumstances, I know how hard some- the stock drops 10 percent, and within suggests, the question is, ‘‘Well, did times that is to accept. a week strike suits are filed naming you know that this product would not But that is the standard we have cre- the company, its chief executive offi- meet its date in August? Well, here is ated in that circumstance, and I think cer, and a bunch of other officers for a memo in the company. It came over the language in this bill holds that conspiring to put out false information your desk. You read it. If you did not same kind of standard. about product X and misleading the know, you should have known.’’ Simple Now, Mr. President, I come to the marketplace. knowledge can be twisted in the hands final question, which is what I think Product X comes out in September. of a careful lawyer, and the CEO has a we should focus on here. Whom are we It is a great hit. The stock price recov- very difficult time explaining this cir- trying to protect? With all of this leg- ers. Presumably nobody is hurt. But, cumstance. islation, whom do we seek to benefit? frankly, all of that is irrelevant be- So a knowledge standard, even an ac- What is the purpose of all of this? Are cause the legal machinery is now in tual knowledge standard, is not going we trying to protect CEO’s? Are we try- motion and they do not care what is to be a safe harbor. It is not going to ing to protect lawyers? Are we trying happening to the product or the com- protect the CEO. And again the point, to protect security analysts and news- pany. Whether they want to or not, the Mr. President, it is not going to be for papers that report things? Whom are top management of that company must the benefit of the investors because the we trying to protect at base by all of now focus on an issue that is irrelevant CEO is not going to be able to be doing this legislation? The answer, Mr. Presi- to the management of the business; what he is hired by the investors to dent, is the investor. The purpose of and, if I may, Mr. President, to the det- do—run the company. He is going to be this legislation is to protect the inves- riment of the investors in that com- worrying about this particular prob- tor and his or her investment. pany because the investors in that lem. Look at every issue that we are talk- company want top management focus- This is the kind of thing that drives ing about here through that particular ing on sales. They want top manage- companies to settle out of court and to lens. Is it good for the investor or is it ment focusing on efficiency. They want say, ‘‘Well, we really did not do any- bad for the investor? Is it good for the top management focusing on cutting thing wrong but in order to get back to investor to have the CEO feel con- costs and opening new markets. But in- the business of making products and strained about talking about the pros- stead they have a situation where in out of the business of prosecuting law- pects of his company? Is it good for the the name of the investors the legal ma- suits, we will settle even though we are investor to have the CEO being hedged chinery is forcing the top management pretty sure we did not do anything about by lawyers who tell him when he of that company to focus on something wrong.’’ goes before the security analyst: You totally unproductive—coming up with No. What we need to have is what we cannot talk about this; you cannot a defense against the charges that they have in this bill, a safe harbor that talk about that; you cannot make any mislead the public. says not only did the CEO have knowl- speculation of any kind lest you run June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9123 the risk of exposing yourself to these So, Mr. President, I oppose the before 11:45 was consumed, not quite kinds of suits later on. amendment by the distinguished Sen- but primarily, on one side. That is not I submit that it is good for the inves- ator from Maryland. I enjoy serving really fair to my colleagues, and I rec- tor to have the CEO be as open and with him on the Banking Committee. I ognize that. I think if we divided it— candid as he possibly can be and to say enjoy the intellect and I enjoy the was it from 11:15 on? to the security analyst: Yes, it is my thoroughness with which he ap- Mr. BENNETT. It was 11:09. judgment that product X will be on the proaches these decisions, and I hope he Mr. SARBANES. If that time were di- market in August. Because what if he recognizes it is not an act of disrespect vided equally, what would the time sit- is right and product X is on the market on my part when I say I disagree with uation now be? in August, and he did not tell anybody him on this amendment and intend to The PRESIDING OFFICER. The Sen- that and they did not have the oppor- vote against it and urge my colleagues ator from Maryland would have 10 min- tunity to buy the stock in the expecta- to do the same. utes, and the Senator from Utah would tion that that would be the case? Now, Mr. President, I ask unanimous have 10 minutes. Is it good for the investors to have consent that at 2:15 p.m. today, Sen- Mr. BENNETT. I ask unanimous con- him say: I have differences of opinion ator KASSEBAUM be recognized in morn- sent that that be the state of the time within the company; there are some ing business for not to exceed 5 min- from this time until we break for people who do not think it will be. utes, and that at the hour of 2:20 p.m. lunch. Yes, it is good for the investors to there be 40 minutes of debate on the The PRESIDING OFFICER. Without have him be as candid and open as pos- Sarbanes amendment No. 1477, equally objection, it is so ordered. sible. And the only way you can get divided in the usual form, with the The PRESIDING OFFICER. Who that kind of candid, open discussion is vote occurring on or in relation to the yields time? if you have a safe harbor in which that Sarbanes amendment at 3 p.m. today, Mr. SARBANES. And that would honest CEO can sail knowing that he with no second-degree amendments in mean from the time we went on this will be protected from the waves and order to the amendment; further, that amendment, all time would have been whims of the shark suits that are out following the disposition of the Sar- equally divided; is that correct? there. banes amendment No. 1477, Senator The PRESIDING OFFICER. That is Is it good for the investor or is it bad SARBANES be recognized to offer an correct. for the investor to have the CEO’s at- amendment regarding safe harbor. Mr. SARBANES. Yes. tention diverted into lawsuits that Mr. SARBANES. Reserving the right Mr. BENNETT. Mr. President, I yield have nothing whatever to do with the to object, Mr. President, I have indi- such time as he may consume to the management of the company? I submit cated a desire to have an up-or-down Senator from Connecticut. it is bad for the investor to have the vote on the amendment. Does the Sen- The PRESIDING OFFICER. The Sen- CEO concentrating on things other ator have any problem with that? ator from Connecticut. than the things for which he was hired. Mr. BENNETT. Mr. President, I have Mr. DODD. I thank my colleague And ultimately, is it good for the in- no problem with that, but I cannot from Utah. I yield myself 5 minutes. If vestor or is it bad for the investor to bind other Senators who may wish to the Chair would remind me at the end have the company paying out millions make a motion to table. of 5 minutes so as not to take too much of dollars in legal fees on issues that Mr. President, I would have no objec- time on this because a lot has been said are tangential to the company’s per- tion to that. already about it. formance? Mr. SARBANES. So with that Mr. President, let me make a couple I submit it is bad for the investor, amendment to the unanimous consent of observations to underscore the point and it becomes doubly bad for the in- request, I have no objection. that my colleague from Utah has al- vestor when, as we have seen over and Mr. BENNETT. Yes, on the Sarbanes ready addressed. Some of my col- over again in the debate on this bill, amendment there would be no motion leagues have said that the safe harbor the highest percentage of those fees to table. provisions of S. 240 do not go as far as and fines being paid out by the inves- Mr. SARBANES. Right. some would suggest. First, our provi- tor—those are the investor’s moneys; The PRESIDING OFFICER (Mr. sions of safe harbor limit significantly those are not the CEO’s moneys. When ASHCROFT). Without objection, it is so the circumstances in which the safe you say those are the company’s mon- ordered. harbor applies. eys, there is only one source of com- Mr. DODD addressed the Chair. I think it is very important to lay pany money, and that is the investor. The PRESIDING OFFICER. The Sen- out as clearly as I can here, what is in- That is the investor’s money going out, ator from Connecticut. cluded and what is excluded. with the vast bulk of it going out to Mr. DODD. Mr. President, I thank The safe harbor provisions of S. 240 the plaintiff’s attorneys and not the in- the Chair. apply only—only—to statements made vestor. They say: Oh, look, we are pro- Let me just, if I can, make a couple by issuers or outside reviewers retained tecting the investor. Look at the of observations here about this amend- by issuers. Statements by stockbrokers money that is going back to the inves- ment and the history—— are not protected at all under S. 240’s tor. The PRESIDING OFFICER. Who safe harbor. Certain issuers are ex- No, the money is going back to the yields time? cluded. Not all issuers are included; lawyer, and in the meantime all of the Mr. DODD. How much time remains? some are excluded from safe harbor, in- money and attention and activity on The PRESIDING OFFICER. All of cluding anyone who has violated secu- behalf of the management of the com- the time remaining is under the con- rities laws within the prior 3 years. pany has been focusing on this suit. trol of the Senator from Maryland. Penny stock companies, blank check That is why they settle, Mr. Presi- Mr. SARBANES. Mr. President, I do companies, investment companies, all dent. They settle because it is good for not think that is correct, in all fairness companies, Mr. President, are excluded the investors and for them to get this to my colleague. I wish to be fair. I from the safe harbor when they engage thing behind them. But it would be bet- think the agreement was we would di- in certain types of transactions such as ter for the investors if honest execu- vide equally the time between 11:10, as IPO’s, initial public offerings. The ten- tives who have no intent and no pur- I understood it, when we went—— der offers, rollup transactions, all of pose of deceiving have a safe harbor Mr. BENNETT. Mr. President, I ask those are excluded. So this is a very from which they can explain to the unanimous consent that the previous narrow provision here. All information public the things that are going on in unanimous-consent be amended to be contained in historical financial state- the company and make statements as the Senator from Maryland remem- ments is excluded as well. about the future fully hedged about bers it. Second, Mr. President, the safe har- with protections that say these are Mr. SARBANES. I thought that is bor applies only to projections or esti- speculations so that the investor then what it was. mates that are identified—they must has information from which to make It would not be fair to divide the be identified—as forward looking state- his or her own intelligent decisions. time from 11:45 equally since the time ments and that refer ‘‘clearly and S 9124 CONGRESSIONAL RECORD — SENATE June 27, 1995 proximately’’ to ‘‘the risk that actual people today who find the previous bill forward-looking statements. Our capital results may differ materially’’—that is so attractive, I must say candidly, markets are built on the foundation of full the language, ‘‘the risk that actual re- were not exactly racing to support the and fair disclosure. Analysts are paid and in- sults may differ materially’’—from the legislation when it potentially could vestors are rewarded for correctly assessing a company’s prospects. The more investors projection or estimate. have been adopted in the last Congress. know and understand management’s future That goes right to the heart of what Putting that aside, let me also point plans and views, the sounder the valuation is the Senator from Utah was talking out to my colleagues, having made the of the company’s securities and the more ef- about. This is a very narrow area we offer 17 months ago to have the SEC ficient the capital allocation process. Yet, are talking about, and the point is to move, frankly, the SEC has not moved, corporate America is hesitant to disclose create a safe harbor. Why do you create and I am convinced today they would projections and other forward-looking infor- a safe harbor? Because we are trying to not move on this. mation because of excessive vulnerability to solicit from these issuers as much in- There is ample evidence to indicate lawsuits if predictions ultimately are not re- that that suspicion of mine is correct. alized. formation as possible so that a poten- It goes on to talk about how he was In a June 22 edition of the Bureau of tial buyer can have as much awareness a businessman all his life, and so forth, National Affairs publication, which fol- as possible about where this stock or and lays out some specific areas and lows legislation dealing with financial where this company is likely to go. It talks on page 2 of this letter, in the institutions, under securities, the is in the interest of the investor that last paragraph: we get as much of that information as headline is, ‘‘SEC safe harbor initiative A safe harbor must be balanced, should en- possible. may be overtaken by litigation re- courage more sound disclosure, without en- There is no requirement in law that form.’’ Following are several pertinent couraging either omission or material infor- an issuer even put out forward looking paragraphs I think support what I am mation or irresponsible and dishonest infor- statements. In fact, what has happened saying: mation. Safe harbor must be thoughtful so lately is a lot of them have retreated Although one agency official stated in late that it protects considered projections, but from that very advantageous idea be- March that SEC action in its October con- never fraudulent ones. cause of the very situation we find our- cept release was imminent, that has not ma- I invite my colleagues to look at the selves in today. So it is in our interest terialized. Rather, the SEC remains at the language on page 121 of our bill, where to solicit this kind of information, but concept-release stage on the initiative. Its we specifically lay out, No. 1, know- inaction during the 8 months since release ingly—talking about projections— in doing so, we say, ‘‘Look, we want was issued has been attributed by some ob- you to share as much information servers to some differences of opinion within knowingly made with the purpose and about where you think this company is the Commission on various issues connected actual intent of misleading investors. going, where this stock is going so that with the initiative. So we clearly there are saying if you investors will make intelligent deci- Another Commissioner, Richard Rob- make a knowingly fraudulent state- sions.’’ erts, told BNA June 21 that there are ment, a misleading—not even fraudu- In doing so, if you do anything—and bona fide reasons that the Commission lent but misleading statement—a we say very clearly in the bill if you do did not act quickly on the concept re- knowingly misleading statement, that anything that knowingly with purpose lease, including questions about the you are not protected by the safe har- or intent of misleading investors, on agency’s authority in the area of for- bor provisions. Is this perfect? I cannot page 121 of this bill, we now take out ward looking information. say that it is. But I will say it con- the word ‘‘expectation’’—knowingly Again, we just were not getting the forms to what the Chairman of the SEC made with the purpose or intent of action in this area. says, that the present situation is not misleading investors, then you are ex- It is a complex area. The Senator working very well. We know when we cluded. Not only excluded, you are sub- from Maryland is absolutely correct. see what is happening with the for- ject to the penalties of the law. Anyone who suggests otherwise has not ward-looking statement; they are being So anyone who knowingly with in- spent any time looking at this. But I contracted and contracted and con- tent to mislead in those forward look- will argue, despite the fact that our tracted. That is the practical effect of ing statements is subject to the provi- original bill tried to get the SEC to the environment we live in today. That sions of the law that apply in this piece come forward in this area—in fact they does not serve the investor community of legislation before us. But the idea is have not—that there is a good case to well, Mr. President. to get that information out, and it be made that leaving these matters With those reasons, with all due re- seems to me that is in everyone’s inter- just up to the regulatory bodies or, as spect and great admiration for my col- est. we have seen in other cases dealing league from Maryland, throwing this You have to strike that balance. with aiding and abetting, for instance, back into the court of the SEC I do not There are those who are opposed to to the courts, is not a wise way to go think is going to advance our cause in safe harbor. I disagree with them; I un- ultimately. dealing with clear reform in the area of derstand it. I do not think anyone who In many matters here, we ought to be safe harbor that is needed. has really looked at the larger issues trying to establish through the legisla- I urge my colleagues to reject the would agree with it. So we have at- tive process what our intent is. So amendment offered by the Senator tempted with this legislation to craft while I welcomed in the past the SEC’s from Maryland. the safe harbor provisions. efforts in this regard, that was not Mr. SARBANES. Mr. President, I lis- My colleague from Maryland has cor- forthcoming. Now it is being suggested tened very carefully to both of my col- rectly pointed out that in the earlier by those who opposed the bill last year leagues and I would like to, very quick- bill we introduced some 17 months ago, that I ought to go back to my earlier ly, address some of the points they we asked the SEC to try to develop a position on this matter, even though made. I think the Senator from Con- regulatory scheme to deal with safe the SEC did not move in this area, necticut is being extremely unfair to harbor. I must say, I have heard now given the 17 months they had an oppor- the SEC in terms of saying that they for the last 2 days a lot of these kudos tunity to do so. did not pick up on this. They have and praise over the bill that we intro- Letters are being bandied about. The picked up on it. Whether they should duced last March. I would very much letter of May 19 from the Chairman of have picked up sooner is the question. have liked to have passed a bill in the the SEC certainly recognizes that But they did issue a period for com- previous Congress in this area, but I there is a need to strengthen the safe ment, and that was in October 1994, and could not get that kind of support. harbor provisions. In fact, in paragraph they received comments—over 150. I ask unanimous consent that I may 3 of Chairman Levitt’s letter on May They then held hearings in the first be able to proceed for 5 additional min- 19, he says: part of this year. The Chairman, I think, of the SEC, as the Senator utes. There is a need for a stronger safe harbor The PRESIDING OFFICER. Without than currently exists. The current rules have quoted him in the letter, has indicated objection, it is so ordered. largely been a failure, and I share the dis- that he wants to do something about Mr. DODD. Mr. President, I wish we appointment of issuers that the rules have safe harbor. The Senator quoted him had some of that support. The very been ineffective in affording protection for correctly. June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9125 Mr. President, I ask unanimous con- who said maybe they were not moving . . . I cannot embrace proposals which sent that a letter from Chairman as quickly because they had some allow willful fraud to receive the benefit of Levitt, dated May 25, 1995, be printed in doubts about their statutory authority safe harbor protection. the RECORD at the end of my state- to do so. Of course, his original pro- Others have criticized this provision ment. posal would have provided that statu- as well. The Government Finance Offi- The PRESIDING OFFICER. Without tory authority. So if that is an inhibi- cers Association, representing more objection, it is so ordered. tion, the amendment eliminates that than 13,000 State and local government (See exhibit 1.) and any doubts with respect to the financial officials, county treasurers, Mr. SARBANES. The real question SEC’s ability to move ahead. The Com- city managers, and so forth, wrote on here is not whether we should improve mission received 150 comment letters the safe harbor provision in the bill: safe harbor. The question is, who is in response to the release. It has We believe this opens a major loophole going to try to do it? Where is the best worked closely with a vast representa- through which wrongdoers could escape li- place to do that? This amendment says ability while fraud victims would be denied tion of the industry. In fact, when recovery. that the best place to do that is at the Chairman Levitt testified in April of I say to my colleagues, no one is ar- SEC, and that this body is not equipped this year, he said: to try to work through this complex guing here that we do not need to do From the Commission’s perspective, an ap- something to improve safe harbor. The issue; and if it tries to do it, the law of propriate legislative approach is contained unintended consequences is going to issue framed by this amendment is, in the Domenici-Dodd bill. This provision who should do it? I submit, as I indi- bring a lot of potentially devastating would allow the Commission to complete its developments. rulemaking proceeding and take appropriate cated earlier, in an issue of this com- The proposal to have it done at the action after its evaluation of the extensive plexity, it is better that it be done by SEC is, of course, the proposal which comments and testimony already received. the Securities and Exchange Commis- the Senators from Connecticut and Based on the Commission’s experience with sion. this issue to date, we believe there is consid- The North American Securities Ad- New Mexico had when they first intro- erable value in proceeding with rulemaking ministrators Association represents 50 duced the bill—the bill which Members which can more efficiently be administered, State securities regulators. They said: cosponsored. Members who cosponsored interpreted and, if needed, modified than can this legislation were cosponsoring a We believe this opens a major loophole legislation. through which wrongdoers could escape li- provision with respect to safe harbor, The North American Securities Ad- ability while fraud victims would be denied which is exactly the amendment at the ministrators Association, the Govern- recovery. desk. That provision was subsequently ment Finance Officers Association, the These are on the front line of defense changed in the committee. That is not National League of Cities, and nine against securities fraud. They are real- the provision that was in the legisla- other groups, in a letter to the com- ly the regulators closest to the individ- tion which Members were signing onto mittee, on the 23d of May, expressed ual investors. They call the provision as cosponsors. the same view, saying: in this bill an overly broad safe harbor, Chairman Levitt has warned us of making it extremely difficult to sue the danger that the provision in the We believe the more appropriate response is SEC rulemaking in this area. when misleading information causes bill will protect fraud. Safe harbor is a investors to suffer losses. grant of immunity, an exemption from Unfortunately, the committee print AARP has also written calling for re- any liability. Safe harbor, in effect, substitute to S. 240, unlike the bill as placement of the safe harbor provision, says that you are immunized alto- introduced, abandoned this approach in with a directive to the SEC to issue a gether. So it is very important to prop- favor of trying to formulate a statu- rule which structures a safe harbor erly define the safe harbor. I have been tory safe harbor. that protects both legitimate business interested in Members—first of all, the This is contrary to all the advice we and investors. chairman amended the statutory provi- are receiving from the regulators. Ev- Given the broad definition in this sion in the bill on safe harbor shortly a erybody gets up here and says this in- legislation of forward-looking state- while ago here on the floor, recognizing terest group wants this and this inter- ments, discussed above, it is crucial that this effort to write this statutory est group wants that. I recognize that. that the legislation not shield such standard was deficient, I assume. I have been the first to state that you statements when they are false. En- My colleague from Connecticut is have these interest groups clashing couraging reasonable disclosures is one citing provisions in the bill where cer- over this thing. But what are the pub- thing. Allowing fraudulent projections tain activities cannot get safe harbor. lic interest officials telling us—those is another. Actually, that kind of safe He specifically precludes them from whose responsibility it is to serve the harbor would hurt investors trying to doing that and he went through some public interest, not one or another of make intelligent investment decisions of them. All of those are things that these economic interest groups—what and penalize companies trying to com- developed. We got concerned about are they telling us? Of course, what municate honestly with their share- penny stocks when they were used as they are telling us is that the approach holders. It runs counter to the whole an abuse. Who knows what the next in my amendment is the approach to premise of our Federal securities laws, abuse is going to be down the road? If follow. which has helped to give us strong the SEC does this, they are in the busi- The standard that is in the legisla- markets. The fraud must be deterred, ness of being able to adjust to the tion, I think, is going to allow fraud to and the fraud must be punished when it abuses as they come. The SEC can, in occur. In fact, Chairman Levitt, on the occurs. effect, modify the framework. These morning of the markup, wrote about Mr. President, I think it is important listings of exceptions to the safe harbor the language that is in the bill before that safe harbor not protect fraudulent standard in the rule are a demonstra- us. He stressed that this language statements and, in my judgment, the tion, in my judgment, of the inappro- failed to adhere to his belief that a safe best way to address this issue is to, in priateness of trying to write the stand- harbor should never protect fraudulent effect, use the approach that was ini- ard here, as opposed to letting it be statements. Let me quote him: tially in the legislation charging the done by the regulatory authorities. I continue to have serious concerns about SEC with developing a safe harbor reg- The forward-looking statements in the safe harbor fraud exclusion as it relates ulation—a process now engaged in. this bill are broadly defined. They in- to the stringent standard of proof that must These are the transcripts of the hear- clude both oral and written state- be satisfied before a private plaintiff can pre- ings they held on the issue. They re- ments. Now, we want a lot of the infor- vail. As Chairman of the Securities and Ex- ceived over 150 comment statements mation, but it is the kind of informa- change Commission, I cannot embrace pro- and letters, and they have engaged in tion investors use in deciding whether posals which allow willful fraud to receive an extensive discussion with a whole to purchase a particular stock. the benefit of safe harbor protection. range of people who have acquaintance Now, the Chairman of the SEC him- He had seen the language. That is a and knowledge in this area. self has said they want—in fact, the comment on the very language that is I very much hope the body will adopt Senator quoted one member of the SEC in this bill. He said: the amendment. S 9126 CONGRESSIONAL RECORD — SENATE June 27, 1995 EXHIBIT 1 I would like to express my particular grati- harbor for voluntary statements about U.S. SECURITIES AND tude for the courtesy and openness displayed future conditions. EXCHANGE COMMISSION, by the Committee and its staff. I hope we First: will continue to work together to improve Washington, DC, May 25, 1995. Seventy-five percent of the American the bill so as to reduce costly litigation Hon. ALFONSE M. D’AMATO, Stock Exchange CEO’s surveyed have lim- without compromising essential investor Chairman, Committee on Banking, Housing, ited disclosure of forward-looking informa- protections. and Urban Affairs, U.S. Senate, Washing- tion. ton, DC. Thank you for your consideration. That is according to an April 1994 DEAR MR. CHAIRMAN: I understand that Sincerely, this morning you and the members of the ARTHUR LEVITT. survey. Banking Committee will be considering S. f Limited disclosure: 240 and that you will be offering an amend- Seventy-one percent of more than 200 en- ment in the nature of a substitute. While I RECESS UNTIL 2:15 P.M. trepreneurial companies surveyed are reluc- tant to discuss the companies performance. have not had the opportunity to analyze The PRESIDING OFFICER. Under fully the May 24th manager’s amendment to (National Venture Capital Association, 1994.) the Committee print, I appreciate your lead- the previous order, the Senate will Nearly 40 percent of investor relation per- ership and efforts to address the concerns of stand in recess until the hour of 2:15 sonnel surveyed at 386 companies have cut the Commission in drafting your alternative. p.m. back on voluntary disclosure of information The safe harbor provision in the amend- There being no objection, the Senate, to the investment community. (National In- ment, in my opinion, is preferable to the at 12:33 p.m., recessed until 2:15 p.m.; vestor Relations Institute, March 1994.) blanket approach of H.R. 1058. It addresses a whereupon, the Senate reassembled Fear of litigation is the number one obsta- cle to enhance voluntary disclosure by cor- number of the concerns pertaining to the when called to order by the Presiding size of the safe harbor and the exclusions porate managers. (Harvard Business School Officer (Mr. KYL). from the safe harbor. The Committee staff study, 1994.) appears to be genuinely interested in the Mr. BROWN. Mr. President, I suggest Less than 50 percent of companies with Commission’s views of its draft legislation the absence of a quorum. earnings result significantly above or below and has attempted to be responsive. I was The PRESIDING OFFICER. The analysts’ expectations released information pleased to see the latest draft deleted the re- clerk will call the roll. voluntarily. That information, too, is from quirement that a plaintiff must read and ac- The legislative clerk proceeded to one of our great universities, the University tually rely upon the misrepresentation be- call the roll. of California, (November 1993.) fore a claim is actionable. Your attempt to Mr. BRADLEY. Mr. President, I ask Mr. President, it has been asked why, tailor the breadth of the safe harbor of the unanimous consent that the order for originally in the Dodd-Domenici or Do- Securities Exchange Act of 1934 to the more menici-Dodd bills we did not have this narrow safe harbor of the Securities Act of the quorum call be rescinded. The PRESIDING OFFICER. Without statutory safe harbor language. 1933 was encouraging. However, I continue to Mr. President, fellow Senators, the believe that the definition should be further objection, it is so ordered. narrowed to parallel the items contained in Mr. BRADLEY. Mr. President, I ask truth of the matter is that it has been my letter of May 19th. Moreover, there re- unanimous consent that I may proceed 4 years since we first started this exer- main a number of troubling issues. as if in morning business for up to 3 cise of trying to get this law. And the I continue to have serious concerns about minutes. final draft, more or less, of what is the safe harbor fraud exclusion as it relates The PRESIDING OFFICER. Without being alluded to as the Dodd-Domenici to the stringent standard of proof that must or Domenici-Dodd bill is 3 years old. be satisfied before a private plaintiff can pre- objection, it is so ordered. The Senator from New Jersey is rec- For those who are questioning why vail. As Chairman of the Securities and Ex- we do not adopt the original bill’s lan- change Commission, I cannot embrace pro- ognized. posals which allow willful fraud to receive Mr. BRADLEY. I thank the Chair. guage on safe harbor, let me just sug- gest that such an approach’s time has the benefit of safe harbor protection. The (The remarks of Mr. BRADLEY and come and gone. If the Senators sug- scienter standard in the amendment may be Mrs. KASSEBAUM pertaining to the in- so high as to preclude all but the most obvi- troduction of S. 969 are located in to- gesting the regulatory approach would ous frauds. I believe that there should be a have all come to the party 3 years ago, day’s RECORD under ‘‘Statements on In- direct relationship between the level of troduced Bills and Joint Resolutions.’’) the bill would have been enacted. But scienter required to prove fraud and the nobody would. So what happened is we types of statements protected by the safe f had in that bill asked that the Securi- harbor. My letter of May 19th indicated the discreet list of subjects that are suitable for PRIVATE SECURITIES LITIGATION ties and Exchange Commission solve safe harbor protection, assuming a simple REFORM ACT this problem. Mr. President, for various reasons ‘‘knowing’’ standard. Accordingly, if the The Senate continued with the con- Committee is unwilling to lower the pro- the Securities and Exchange Commis- posed scienter level to a simple ‘‘knowing’’ sideration of the bill. sion is not able to solve the safe harbor standard, the safe harbor should not protect The PRESIDING OFFICER. The time problem. They have had numerous forward-looking statements contained in the from now until 3 p.m. will be reserved hours of hearings, Commissioners are management’s discussion and analysis sec- for debate on the Sarbanes amendment split, we are short two Commissioners. tion. This would be better left to Commis- with the time to be equally divided in There are vacancies. Entrenched staff sion rulemaking. the usual manner. In addition to my concerns about the safe of that institution are arguing back Mr. DOMENICI addressed the Chair. and forth on philosophy and language. harbor, there is no complete resolution of The PRESIDING OFFICER. The Sen- two important issues for the Commission. Meanwhile, the status quo continues, First, there is no extension of the statute of ator from New Mexico. and here we sit with an unfixed safe limitations for private fraud actions from AMENDMENT NO. 1477 harbor even though Congress has asked three to five years. Second, the draft bill Mr. DOMENICI. Mr. President, I have them to fix it. does not fully restore the aiding and abet- discussed this with Senator D’AMATO. Last year in appropriations, Mr. ting liability eliminated in the Supreme Some of the time remaining will be al- President, fellow Senators, I put in the Court’s Central Bank of Denver opinion. I located to me by him. So let me start am encouraged by the Committee’s willing- appropriations bill report language ness to restore partially the Commission’s by yielding myself 7 minutes from our that the SEC needed to create a new ability to prosecute those who aid and abet side. safe harbor and to report back to us by fraud; however, a more complete solution is The PRESIDING OFFICER. Without the end of the fiscal year. The provi- preferable. objection, it is so ordered. sion called upon them to tell the peo- I also wish to call you attention to a po- Mr. DOMENICI. Mr. President, ple of this country what the safe har- tential problem with the provision relating speaking now of the safe harbor amend- bor would be since the SEC wanted to to Rule 11 of the Federal Rules of Civil Pro- ment that is before us, and the safe develop it. They have not done it. It is cedure. I worry that the standard employed harbor language that is in the bill, I in your draft may have the unintended effect almost time for another appropriations of imposing a ‘‘loser pays’’ scheme. The first want to call to the Senate’s atten- bill. And they have not done it. greater the discretion afforded the court, the tion the chilling effects on voluntary Let me suggest that inaction and less likely this unintended consequence may disclosure that exist today because of gridlock at the SEC do not mean we appear. our failure to have an adequate safe should not do something. In fact, I do June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9127 not believe that is what the current through that with you already. But I predictions; they may not come true. It head of the SEC, Arthur Levitt is say- can repeat again, frustrated by this may turn out that the actual results ing, that we should not do anything be- lack of progress, I put language in the differ materially from this prediction cause we should still leave it up to appropriations bill’s report. about the future. them 3 years and untold numbers of Actually, it has been 8 months since The Council of Institutional Inves- hours, and hundreds of pages of testi- the SEC took its first step and issued a tors—that is the professional people mony. So frankly, we ought to do concept proposal, and still we get noth- who manage these funds, people who something statutorily about the safe ing. have a fiduciary duty and high level of harbor. So in answer to those in the Cham- trust to manage pension funds—told The fact that it is a problem is abso- ber, including my friend from Mary- the SEC that any safe harbor must be lutely manifold before us here today. land, Senator SARBANES, who say Sen- ‘‘100 percent safe.’’ This means that all And the fact that those very same law- ator DODD, Senator DOMENICI, if you information in it must be absolutely yers, that small group of sharks, that left the bill the way it was when you protected even if it is irrelevant or un- sit around waiting for litigation, are originally introduced it, I would be for intentionally, or intentionally, false or fighting so hard to keep the current, this provision because you did not have misleading.’’ The bill does not go that ineffective safe harbor makes it pa- the provision that is before the Senate far. tently clear that filing frivolous law- today. Of course not. We have been For decades, Congress has deferred to suits when a company misses an earn- anxiously waiting for 3 years now for the courts in setting the contours of ings projection is one of their great the SEC to fix this. And since they class action 10b–5 litigation. We are slot machines. This is one situation have not, we believe the committee has changing that in this bill, and we where they just jump out there and come up with an excellent solution to should not pass the buck on to anyone pick up on statements that are pre- this problem. on something as important as safe har- dictions of the future, and anything Let me go on then and cite for the bor. that does not turn out as it was spoken RECORD a little detail about the dis- The chilling effect on the willingness as a basis to file a lawsuit. agreements among the Commission and of companies to make disclosures is Forward-looking statements are pre- various staff at the SEC just to show bad for investors, for analysts, for pro- dictions about the future. Frequently, that there is great imbalance. fessional fund managers, for retirement these lawsuits are based on past state- Wallman wants a meaningful safe stewards, companies and the market in ments of future expectations. harbor. Beese wants a strong safe har- general. The high technology compa- Why do not future predictions always bor. The Commission is two commis- nies cannot grow without a meaningful come true? sioners short and there will be three safe harbor, and we provide just that. empty seats soon. With new commis- Mr. President, changes in the busi- We provide a meaningful safe harbor. sioners eventually coming on board, it ness cycle occur beyond the control of That meaningful safe harbor clearly will slow the process even further. It the company or their executive or their does not protect against intentional will be years. accountants. Is that fraud? fraud and knowing misrepresentations. Changes in the market occur. And The Senate bill recognized the prob- We have made it very specific; individ- ask somebody why the changes have lem at the SEC and the urgency of a uals engaging in that type of activity occurred and you will get as many an- meaningful safe harbor. The committee can not get into our safe harbor. Those swers as there are people you would made the change and crafted a statu- statements are still actionable. So any ask. Is that fraud? tory safe harbor, even though the Secu- statements on the floor that we will let Changing the timing of an order—is rities Commission could not tell us people perpetrate fraud because of this that fraud? how to do it. And I believe the commit- statutory safe harbor, which includes Because forward-looking statements tee have done it right. They had the knowledge, purpose and intention, that often involve future products, innova- benefit of this entire record before the is not so. Nonetheless, you either have tions, technologies of the future, fail- SEC. to have a safe harbor that works on fu- ure to meet one or another expecta- The main concern that Arthur Levitt ture statements that are predictive tion, is inevitable. But it should not be has expressed to the Congress is that only or you have it wide open again for inevitable that a lawsuit follows. But I there should be no safe harbor for pre- litigation and we are right back where ask: Is each of those a fraud if you do dictions about the future that were in- we started. not meet them? No. It is simply failure tentionally false. of a prediction about the future to The Council of Institutional Inves- Mr. President, I yield the floor. come true. tors, the mutual fund managers, did Mrs. FEINSTEIN. Mr. President, the Talk about the chilling effects of dis- not agree with Arthur Levitt and they safe harbor provisions of the bill have closure. I have just explained the re- had suggested that Congress go further been criticized by some of my col- ality of harm this ineffective policy is than our bill. They argued that state- leagues. I would like to address those causing in the marketplace. And so ments which are accompanied by criticisms by pointing out that S. 240 now let me proceed to talk about the warnings should be per se immune from puts more responsibilities on compa- safe harbor in this bill. liability. The Senate bill does not go nies seeking to use the safe harbor and The PRESIDING OFFICER. The Sen- that far. puts more conditions on their use of ator’s time has expired. CALPERS—the California public em- the safe harbor than the SEC does in Mr. DOMENICI. I yield myself 5 more ployees pension fund—in their testi- its current rules. It also goes further minutes. mony to the SEC, stated: than a number of courts of appeals that Arthur Levitt, for whom I have great By definition, projections are inherently have examined the issue of liability for respect, and he knows that, said he uncertain. The more such statements are forward-looking statements. wanted a balanced safe harbor. The based on assumptions susceptible to change, I wonder if the bill’s manager would SEC has been promising this new safe the less useful they are in assessing prospec- engage in a colloquy with me on this harbor for at least 3 years. Arthur tive performance. Investors recognize this point? and appropriately discount the importance Mr. D’AMATO. I would be delighted Levitt has said that the current safe of such information when making invest- harbor ‘‘is a failure.’’ ments. This being the case, we see no reason to. That is not Pete DOMENICI, who pro- why investors should then be allowed to rely Mrs. FEINSTEIN. First, S. 240 has a posed this bill some 4 years ago; it is upon such statements in an action for fraud definition of forward-looking state- Arthur Levitt saying the current safe after their speculative nature has been ful- ment. It includes projections of reve- harbor, whatever it is, is a ‘‘failure.’’ filled. nues, statements about management’s The securities litigation reform bill There is a warning that will accom- plans for the future, and statements that Senator DODD and I introduced, pany each of these statements if it is about future economic performance of directed them to make plans for, and to be protected under the safe harbor a company, among other things. Can recommend a fix to this broken safe created by the bill. It will clearly: say you tell me where that definition came harbor situation. We have gone these forward looking statements are from? S 9128 CONGRESSIONAL RECORD — SENATE June 27, 1995 Mr. D’AMATO. It came directly from cided these statements should not be has also indicated that the provision in rule 175. It is the SEC’s own definition protected under the safe harbor. the bill is not acceptable, that it goes of forward-looking statements. Ten, finally, the safe harbor does not much too far. And, in fact, the very Mrs. FEINSTEIN. Now, the Banking apply to forward-looking statements in morning of the markup he said in a let- Committee excluded a number of com- the financial statements of a company. ter to the committee, ‘‘I cannot em- panies and a number of transactions So, to answer your question, we ex- brace proposals which allow willful from using the safe harbor. Can you ex- cluded a long list of companies and fraud to receive the benefit of safe har- plain why that was done? transactions from the safe harbor, be- bor protection.’’ Mr. D’AMATO. The Banking Com- cause we were concerned that, in these In other words, it is his view of the mittee made a policy decision to ex- companies and in these transactions, standard written in the bill that it clude from the safe harbor certain com- there might be a temptation for com- would provide safe harbor protection panies and certain transactions in panies to make rosy projections. for willful fraud. I challenge anyone in which the incentives for making overly Mrs. FEINSTEIN. The committee’s the Chamber to rise and defend that optimistic forward-looking statements bill also has a tough requirement that, should be the case. might be present. It is important to in order to use the safe harbor, a com- What they will try to argue is, ‘‘No, note that the safe harbor does not pany has to accompany any projection this standard does not really permit apply to: with a warning is that not correct? that.’’ But here is the Chairman of the First, statements about a company Mr. D’AMATO. That is true. The bill Securities and Exchange Commission, that within the past 3 years has been requires that there be a clear warning in effect, saying that this standard convicted of certain violations of the that actual results may differ materi- does permit that. And he is supported Federal securities laws. ally from any projection, estimate, or in this judgment by a range of public Second, statements made in an offer- description of future events. interest groups concerned with securi- ing by a blank check company. These Mrs. FEINSTEIN. Then, I want to ties regulation. The North American are companies that offer securities to compliment the committee for its Securities Administrators Association the public, but which have no clear work here. Clearly this is a difficult has come in with respect to this matter business plan and are therefore highly area. We want to provide certainty for and have indicated that they believe speculative. companies and encourage them to that the safe harbor definition should Third, statements made by an issuer make disclosure. At the same time, we be left to the Securities and Exchange of penny stock. These are companies want to make sure that no one takes Commission. In a May 23, 1995, letter, that sell very low priced stock, often advantage of the safe harbor to mislead the North American Securities Admin- through brokers who use high pressure investors. You have tried to strike a istrators Association, the Government sales tactics. There have been signifi- balance here. Finance Officers Association, the Na- cant problems of fraud in the sale of The PRESIDING OFFICER. Who tional League of Cities, and nine other these securities in the past. yields time? groups expressed the view: Fourth, statements made in connec- If no one yields time, the time will be We believe the more appropriate response tion with a rollup transaction. These deducted equally. is SEC rulemaking in this area. are transactions in which sponsors of Mr. DOMENICI. Parliamentary in- Mr. DOMENICI. Will the Senator limited partnerships attempt to com- quiry, Mr. President. How much time yield? bine many separate partnerships and do we have? Mr. SARBANES. Certainly. rake off huge management fees. Con- The PRESIDING OFFICER. The Sen- Mr. DOMENICI. Mr. President, I stat- gress passed legislation to address ator still has 5 minutes 48 seconds; the ed in the Senator’s absence—you can these abuses in 1990. We shouldn’t other side has 18 minutes. charge this to my time; I do not mean allow these transactions to use the safe Mr. SARBANES. Mr. President, how to use his—that the SEC had been try- harbor. much time remains? ing to do this for 3 years. And last Five, statements made in connection The PRESIDING OFFICER. The Sen- year, we put it in the appropriations with a going private transaction. These ator has 17 minutes remaining. bill. I said, because I was the one who are transactions in which a company Mr. SARBANES. How much is re- wrote it in, while funding the SEC, we buys back its shares from its public maining on the other side? expect them to do it. Is it not true they shareholders. Often, it involves man- The PRESIDING OFFICER. About 5 have been unable to arrive at a consen- agement of the company buying back minutes. sus and present one that they are will- the shares. Mr. SARBANES. I thank the Chair. ing to say will work and should be Six, statements made in connection Mr. President, the amendment we are adopted? Is that not true? with the sale of mutual funds. Mutual about to vote on shortly is an amend- Mr. SARBANES. No. I think what is funds simply should not be making pro- ment that puts into this bill the very true is that the SEC—the Senator put jections. The SEC has a long series of provision that was in the bill intro- it in his bill that he introduced 15 rules governing mutual fund disclo- duced by Senators DODD and DOMENICI, months ago, in March 1994, was when sure. which referred over to the Securities he first brought forth in statutory lan- Seven, statements made in connec- and Exchange Commission the respon- guage the proposition that it should be tion with a tender offer also are ex- sibility for developing a safe harbor referred to the SEC. The SEC, in Octo- cluded. These often are hotly contested provision. ber 1994, issued a concept release and takeover battles, and we have decided I have to tell you, I think it is either notice of hearing. In that concept re- not to give them any safe harbor pro- the height of arrogance or the height of lease, they invited comments to be tection. folly to be trying to draft these stand- made before the end of the year, and Eight, statements made in connec- ards here in the committee and in the they also scheduled hearings to take tion with certain partnership offerings Chamber of the Senate. Even the pro- place in February of this year, of this and direct participation programs. ponents admit this is a very complex very year. Very often, these are securities prod- issue. The original bill as introduced Now, the SEC received over 150 com- ucts put together in-house at a broker- and as cosponsored provided to send ments by the end of the year. They dealer, and we think the temptation this issue to the Securities and Ex- held 3 days of hearings, 2 days in Wash- for making rosy performance projec- change Commission in order for them ington and 1 day in California. This, in tions may be too great in these cases. to put their expertise and their rule- fact, is the hearing record from those Nine, statements made in connection making authority to work in order to hearings conducted by the Securities with ownership reports under 13(d) also develop an appropriate safe harbor pro- and Exchange Commission. Now, as the are excluded. These are the reports re- vision. Chairman of the Commission pointed quired under law by anyone who pur- Now, the Chairman of the SEC has out in a letter to the committee about chases 5 percent or more of a compa- indicated that he thinks changes need the problem of working this out, he ny’s securities. The law also requires to be made with respect to safe harbor said there is a need for a stronger safe that they state their plans with respect for forward-looking statements. But he harbor than currently exists. He has to the company. The committee de- June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9129 made that statement. And I think gen- ability while fraud victims would be denied The idea somehow that this is a erally people accept that. The question recovery. major gaping hole by which defrauded is, who is going to write this safe har- The North American Securities Ad- investors are somehow going to be bor? Does it make sense for the Con- ministrators Association, which rep- taken advantage of is rhetoric. We gress to be writing the safe harbor in- resents the 50 State securities regu- close up that loophole. We close it up stead of the experts and the regulators lators—they are really a front line of by saying no misleading statements. who represent—who are supposed to defense against securities fraud—have In fact, we go further than that. We represent the public interest in this called the provision that is in the bill require there be warnings in these for- matter to devise the safe harbor? ‘‘an overly broad safe harbor making it ward-looking statements. It narrows it Mr. DOMENICI. May I ask a ques- extremely difficult to sue when mis- down to who can take advantage of tion? leading information causes investors to safe harbor, under what circumstances, Mr. SARBANES. Certainly. suffer losses.’’ what kind of people. This is not avail- Mr. DOMENICI. The Senator is as- Mr. President, I submit that the wise able to stockbrokers or others. It is the suming we do not have the public in- course of action here is to adopt this issuers, and it is designed specifically terest in mind when we write this? amendment. That is the provision that to give investors the kind of informa- Mr. SARBANES. We do not have the was originally in the bill. That is the tion they need. expertise. provision that Members were ac- We need to encourage the issuers to Mr. DOMENICI. We do not? quainted with when they cosponsored step forward with their statements, not Mr. SARBANES. We do not have the the bill. Let the Securities and Ex- cause them to step back. It does not expertise of the SEC. And we do not, change Commission, which has the ex- serve the economic interest of this particularly in an area that is as dif- pertise and the knowledge and the ex- country, or anyone for that matter, to ficult and complex as this one. I think perience, deal with this very complex be faced with that kind of a problem. that is very clear. In fact, the standard area and shape a proper safe harbor That is why we included safe harbor, you propose in the bill was amended provision which is not subject to abuse that is why we included the language here on the floor by the chairman of and which is not subject to the objec- to cut out the misleading statements. the committee earlier today. tion of the Chairman of the Commis- We think this is a good provision, and Mr. DOMENICI. I understand. sion, who stated with respect to the we urge that we stick with the lan- Mr. SARBANES. In response to criti- provision that is in this bill that we guage of the bill. cism. If we have to define it legisla- are now trying to change: Mr. SARBANES. Mr. President, what tively, of course we will have to try to I cannot embrace proposals which allow is the time situation? do that. But I invite the Senator’s at- willful fraud to receive the benefit of safe The PRESIDING OFFICER. The Sen- tention to the provisions of the bill harbor protection. ator from Maryland has 7 minutes 40 that try to define out the safe harbor. Mr. President, I reserve the balance seconds. The Senator from New York It is obviously a very intricate and of my time. has 2 minutes 22 seconds. complex section. The Chairman of the Mr. DODD. Mr. President, how much Mr. SARBANES. Mr. President, I say Securities and Exchange Commission, time remains on this side? to my colleague from Connecticut, I upon reading this, then wrote a letter The PRESIDING OFFICER. The mi- think he is being extremely unfair to to the committee saying he could not nority has 7 minutes, 40 seconds. The the Chairman of the Securities and Ex- change Commission. I think the two embrace the proposal because it would majority side has 41⁄2 minutes. allow willful fraud to receive the bene- Mr. DODD. I ask consent to have 2 letters that the Chairman wrote us are fit of safe harbor protection. minutes, if I may? perfectly consistent with one another. So, in fact, your very bill—it is very The PRESIDING OFFICER. Is the I know the Senator is very involved interesting the way this bill has been Senator from Maryland yielding? in this legislation and very anxious to structured. The proposal now before us Mr. SARBANES. Yes. try to pass it. I differ sharply with him allows the SEC to expand the safe har- Mr. D’AMATO. Yes, certainly. I yield on that issue, but I do not think in the bor. In other words, they can provide 2 minutes to my colleague. course of the debate he ought to, in ef- even more of a safe harbor, but it does Mr. DODD. Let me state again, Mr. fect, demean the Chairman of the SEC. not allow the SEC to limit the safe President, there are those, I suppose, The letter he wrote on May 19 spelled harbor. So it is all a one-way voyage. It who would always say, in any matter, out his very considerable concern over is a one-way voyage, and really giving defer to an agency to write it. We deal the safe harbor provision. I quoted the SEC the role that it ought to have with a lot of complex areas of law. This from it at great length earlier in the in this situation and has been denied to is one of them. I admit that. day. I am not going to repeat that here them. But the notion inherent there is that except, for instance, he says: I think the Members are assuming an there is in the SEC an ability to deal A safe harbor must be thoughtful—so that incredible responsibility here. As I with this issue beyond the capacity of it protects considered projections, but never fraudulent ones. pointed out earlier, the North Amer- this body. I do not think that is nec- ican Securities Administrators, the essarily true. In fact, the Commission He then raises a lot of questions Government Finance Officers, the Na- itself is so highly divided on the issue about what safe harbor can cover, and tional League of Cities, and nine other we might wait 2 or 3 years before we he states right in the letter, this is the similar groups all express the view that get an answer. If you read the two let- earlier letter: they thought what was a more appro- ters from Arthur Levitt, one dated May Given these complexities—and in light of 19 and one May 25, you would hardly the enormous amount of care, thought, and priate response is SEC rulemaking in work that the Commission has already in- this area. Now, then, I quoted earlier recognize they are coming from the vested in the subject—my recommendation from the Chairman of the SEC. The same author. In the May 19 letter, it would be that you provide broad rulemaking Government Finance Officers Associa- says, this area has to be cleared up. authority to the Commission to improve the tion, representing more than 13,000 The letter of May 25, I would call a safe harbor. State and local government financial fairly strident letter. The authors That is what the amendment at the officials, county treasurers, city man- might have been different people, al- desk does. That is what this amend- agers, and so on, wrote of the safe har- though they were signed by the same ment does. bor provision in the bill, and I am now individual. The Chairman then went on, since quoting them: We have in this legislation very em- the Senator from Connecticut, or at We believe this opens a major loophole phatically made it clear that for any least colleagues of his were pushing through which wrongdoers could escape li- individual who knowingly and inten- hard for statutory definition, to spell ability while fraud victims would be denied tionally misleads, knowingly inten- out the components that he thought recovery. tionally misleads an investor, that ought to be in any statutory definition Let me repeat that. there is no protection of safe harbor. I of safe harbor. We believe this opens a major loophole do not know how much more clear and At that time, efforts were being made through which wrongdoers could escape li- explicit you can be. to shape this. Those efforts did not S 9130 CONGRESSIONAL RECORD — SENATE June 27, 1995 prove fruitful and, in the end, on May The PRESIDING OFFICER. The Sen- Mr. SARBANES. Mr. President, I, in 25, the morning of the markup, the ator from New York has 2 minutes 22 fact, quoted the very sentence the Sen- Chairman wrote a letter to the com- seconds. The Senator from Maryland ator from New York quoted from Ar- mittee expressing his view about the has 1 minute 48 seconds. thur Levitt where he says, ‘‘There is a provision that is in this bill, the very Mr. D’AMATO. Mr. President, let me need for a stronger safe harbor than provision we are now trying to change. refer to one of the two letters men- currently exists.’’ The question is, how And he said: tioned by my colleague. In the letter, are you going to develop that safe har- I cannot embrace proposals which allow sent by the Chairman of the SEC, the bor? willful fraud to receive the benefit of safe Chairman says: This amendment says the SEC should harbor protection. There is a need for a stronger safe harbor do it. That is what the bill introduced I think Chairman Levitt is a dedi- than currently exists. The current rules have by Senators DODD and DOMENICI on cated public servant. I think he is try- largely been a failure, and I share the dis- March 24, 1994, provided for. Then they ing to do what is right. In his letter, he appointment of the issuers that the rules have been ineffective in affording protection say, well, the SEC has delayed. The acceded to the view that something for forward-looking statements. SEC put out their concept release on needed to be done to provide a stronger He says clearly in this letter that we safe harbor in October 1994. In other safe harbor protection, but then he have not afforded protection for for- words, about 7 or 8 months ago. They raised his concerns in the nature of the ward-looking statements. received 150 responses on the safe har- protections that ought to be made. He History shows that we have been bor issue. That is more testimony than has spent a lifetime on Wall Street. He waiting for 3 years for the SEC to work the Banking Committee has had on all is an experienced businessman. In fact, out the safe harbor issue. Last year, securities litigation issues. he quoted himself as a businessman the Appropriations Committee stated The SEC held 3 public hearings on about the problem of meritless law- that the time for the SEC to act on the safe harbor issue in February—2 in suits. He recognizes the problem of this had come, it said, ‘‘We want some Washington, 1 in San Francisco—62 frivolous lawsuits and, in fact, has been rules. We can wait no longer.’’ witnesses in all: Venture capitalists, working with the committee to try to The Chairman of the SEC has been law professors, corporate executives, address those. He has a sufficient re- working on this but it is obvious that plaintiffs lawyers, defense lawyers, in- moval representing the public interest the Commission has some concerns on stitutional investors. as he does to be able to identify provi- the safe harbor and cannot come to a Arthur Levitt says: sions in this bill which he thinks are point where it publishes rules. I say the There are many questions that have arisen defective. media does not know what they are in the course of the commission’s expla- I want the Members to realize what writing about. What we are attempting nation of how to design a safe harbor. they are doing here. They are trying to to do with this legislation is to allow He then talks about the concept re- enact a standard which the regu- companies the flexibility to make for- lease, the comment letters, the 3 days lators—the Chairman of the Securities ward-looking statements but, holding of hearings, and his meeting personally and Exchange Commission, the State them liable if they make knowingly with a wide range of groups that have regulators, the Government finance of- and intentionally misleading state- an interest in the subject. ficers—are all telling them, ‘‘Don’t do ments. There is no safe harbor for any This matter should be handled by the this; don’t do this.’’ This is not as untested companies and there is not SEC, just the way it was proposed in though we were putting into the law a safe harbor in situations where we felt the original bill, which Members have standard which the regulators acceded the investor was at too great a risk of cosponsored. That is what this amend- to or thought was reasonable. They are being mislead. To this effect, the safe ment does. saying, ‘‘Don’t do this, don’t put this harbor provision excludes IPO’s, it ex- standard in.’’ cludes tender offers, and excludes I urge its adoption. There are two ways to correct that. stockbrokers. If you want a good exam- VOTE ON AMENDMENT NO. 1477 One is to refer it back to the Commis- ple of legislation that goes too far, The PRESIDING OFFICER. Under sion, which is exactly what was in the look at the House bill. the previous order, the question is on bill as it was introduced and a matter I think some of the journalists writ- agreeing to amendment No. 1477 offered the Commission was working at, and ing on this legislation, particularly by the Senator from Maryland. that is what this amendment does. The those from the New York Times, have Mr. D’AMATO. Mr. President, I ask other is to try to define the standard not taken the time to really under- for the yeas and nays. here. If we have to do that, I am pre- stand what this legislation does. I sug- The PRESIDING OFFICER. Is there a pared to address that subject. gest that they take some time to read sufficient second? I do not think that is the wise thing the bill before they write. There is not There is a sufficient second. to do. I do not think that, frankly, a safe harbor that allows companies to The yeas and nays are ordered, and with all due deference to my col- say anything—anything, even inten- the clerk will call the roll. leagues, that there is anyone here who tionally false or misleading state- The bill clerk called the roll. really knows this law intimately and ments—as long as there is a disclaimer Mr. BOND (when his name was well enough in a highly complex area that the statement is in the safe har- called). Present. to write the standard. I say that with bor. This legislation does not institute The PRESIDING OFFICER. Are there all due deference, and I include myself a caveat emptor, buyer beware, atti- any other Senators in the Chamber de- within those about whom I am making tude. I believe that would be going too siring to vote? that judgment. So it ought not to be far, much too far. But to say that the The result was announced—yeas 43, done in the legislation. safe harbor in S. 240 would do this is nays 56, as follows: The initial approach by Senators wrong; it is wrong. DODD and DOMENICI was the correct ap- We cannot continue to allow busi- [Rollcall Vote No. 288 Leg.] proach, and that is what this amend- nessmen to be held up by a handful of YEAS—43 ment does. This amendment is word for buccaneering barristers. That is an art- Akaka Glenn Moynihan word what was in the bill. It would pro- ful term used by my friend and col- Biden Graham Nunn vide the opportunity for the Commis- league from Connecticut, and that is Bingaman Harkin Pell Boxer Heflin Pryor sion, through broad rulemaking au- exactly what these lawyers are doing, Bradley Hollings Robb thority, to improve the safe harbor they do not give two hoots and a holler Breaux Inouye Rockefeller provision, and I very strongly com- about the stockholders. They care only Bryan Jeffords Roth Bumpers Kennedy Sarbanes mend this amendment to my col- about their own personal enrichment. Byrd Kerry Shelby leagues. That is why I have to oppose this Cohen Kohl Simon Conrad Lautenberg I yield the floor and reserve whatever amendment. I yield the floor. Snowe time is remaining. The PRESIDING OFFICER. The Sen- Daschle Leahy Dorgan Levin Specter Mr. D’AMATO. May I ask how much ator’s time has expired. The Senator Exon McCain Wellstone time? from Maryland. Feingold Mikulski June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9131 NAYS—56 Trooper Brian Howe said ‘‘My under- ‘‘I think the only thing they’re sorry about Abraham Ford Lugar standing was that they were drawing a is they got caught,’’ Howe said after the ar- Ashcroft Frist Mack comparison between the characters in raignment. Baucus Gorton McConnell the movie and themselves.’’ The trio allegedly started plotting the Bennett Gramm Moseley-Braun slaying at a coffee-ship in Avon after Free- Brown Grams Murkowski Of course, no movie caused this bru- man—whose handicapped mother once dated Burns Grassley Murray tal killing in Massachusetts. We are all the disabled victim—told Morse and Stanley Campbell Gregg Nickles responsible for our own actions, period. that Meskinis had money and guns stashed Chafee Hatch Packwood Coats Hatfield But, at the same time, those in the en- inside in his School Street home, Pudolsky Pressler Cochran Helms tertainment industry who deny that said. Reid Coverdell Hutchison At 5 p.m. Thursday, the trio went to a Santorum cultural messages can bore deep into Craig Inhofe girlfriend’s house in Avon where they dis- Simpson the hearts and minds of our young peo- D’Amato Johnston cussed ‘‘pulling an armed invasion at Mr. Smith ple are deceiving themselves. If the DeWine Kassebaum Meskinis’ house,’’ Pudolsky said. Dodd Kempthorne Stevens Boston Herald story is true, and if Armed with at least two, maybe three Dole Kerrey Thomas these are the kinds of role models that Domenici Kyl Thompson knives, the suspects left the girl’s house in Faircloth Lieberman Thurmond Hollywood is content to promote, then Morse’s Chevrolet Cavalier at about 1:30 a.m. Feinstein Lott Warner perhaps some serious soul-searching is ‘‘Mr. Freeman knew he was going to kill the victim and the other two went along 100 ANSWERED ‘‘PRESENT’’—1 in order in the corporate suits of the entertainment industry. percent,’’ Pudolsky said in an interview. Bond Let me just indicate again that is the As Meskinis lay asleep in his bed, the men invaded his home and Freeman launched the So the amendment (No. 1477) was re- headline. It is not BOB DOLE’s headline. jected. bloody assault, jamming a knife repeatedly It is the headline this morning in the into the helpless man’s body. Mr. D’AMATO. Mr. President, I move Boston Herald about how these young to reconsider the vote by which the ‘‘So much blood was coming from Mr. murderers bragged about attacking an Meskinis’ body that Mr. Freeman actually amendment was rejected. old man and stabbing the person 27 lost the grip on the knife,’’ Pudolsky said. Mr. DOMENICI. I move to lay that times. In fact, it goes into graphic de- Freeman yelled to Morse for another knife motion on the table. tail about the knife that was so bloody and Morse complied, passing a Buck knife, The motion to lay on the table was that they had to ask for a new knife. Pudolsky said. The blows were so forceful agreed to. Something is wrong in America with that Freeman allegedly broke Meskinis’ The PRESIDING OFFICER. Under wrist and clavicle during the relentless the entertainment industry, and maybe the previous order, the Senator from hacking. it is high time they took a look at Maryland is recognized to offer an Stanley was ‘‘ready, willing and able’’ to themselves and put profit behind com- amendment. assist in the bloody siege—although his at- mon decency. torney and relatives insisted yesterday that Mr. DOLE. Mr. President, will the Mr. President, I ask unanimous con- he was not in the bedroom during the mur- Senator yield to me for 3 minutes? sent that the article from the Boston der. Mr. SARBANES. Certainly. The suspects stole a shotgun and a .22-cali- The PRESIDING OFFICER. The ma- Herald be printed in the RECORD. There being no objection, the mate- ber rifle, stashing them first in the woods, jority leader is recognized. and later inside the girlfriend’s house. Mr. SARBANES. Mr. President, at rial was ordered to be printed in the Police recovered two knives, two victim’s the end of that time I will be recog- RECORD, as follows: guns and bags of bloodied clothing ditched in nized to offer the amendment? WE’RE ‘‘NATURAL BORN KILLERS’’ a dumpster behind a Brockton convenience The PRESIDING OFFICER. That is As they changed out of their bloody store. correct. clothes, the men who plunged a knife into an The trio returned to the woman’s home Mr. DOLE. I thank the Senator. elderly Avon man 27 times bragged that they where three other female friends were stay- were ‘‘Natural Born Killers,’’ a Norfolk ing that night, police said. They stripped f County prosecutor said yesterday. their bloodied clothing, and worried that they had left behind fingerprints, Morse and NATURAL BORN KILLERS ‘‘Haven’t you ever seen ‘Natural Born Kill- ers’ before?’’ suspect Patrick T. Morse alleg- Freeman brazenly returned to the murder Mr. DOLE. Mr. President, today’s edly bragged to a girl after the gruesome scene at abut 5 a.m. to remove evidence from Boston Herald contains a shocking slaying of 65-year-old Philip Meskinis. ashtrays and door knobs, police said. front-page story—a story that should Chilling details of the trio’s murderous at- As Morse and Freeman sat down at 8:30 send shivers down the spines of all tack and their fascination with the murder a.m. for breakfast, Stanley said he was not spree depicted in the motion picture ‘‘Natu- hungry. Americans, especially those who have But Stanley, using a glass of water, gur- criticized my call to the entertainment ral Born Killers’’ were revealed yesterday when Morse, 18, and Leonard Stanley, 20, gled the liquid in his mouth to imitate ‘‘the industry to exercise good citizenship were arraigned on murder charges and held death chortle of Mr. Meskinis as his throat when it comes to producing films that without bail. was being slashed,’’ Pudolsky said. celebrate mindless violence. Police are scouring the Brockton area for a f That is the headline: ‘‘We’re ‘Natural third suspect, Michael F. Freeman, a 20-year- Born Killers.’’’ There was a movie old fugitive and former convict who alleg- ELECTIONS IN HAITI called ‘‘Natural Born Killers.’’ This is a edly wielded the knife that slashed Meskinis’ Mr. DOLE. Mr. President, long-de- throat early Friday morning and punctured story, the prosecutor says, where the layed parliamentary elections were suspects bragged about the slaying say- his body with 27 stab wounds. ‘‘I’ve been doing violent felonies for 20 held in Haiti last weekend. The long- ing, ‘‘We’re natural born killers.’’ years,’’ Norfolk County prosecutor Gerald suffering Haitian people deserve credit ‘‘We’re ‘Natural Born Killers,’’’ the Pudolsky said after the arraignment. ‘‘This in what is a momentous step in their headline blares, referring to the criti- is one of the most vicious, premeditated efforts to develop democracy. For cally acclaimed Oliver Stone film. murders I’ve seen.’’ many months, it appeared elections This is what happened. The Boston After an intensive investigation that led to might never take place. Since January, Herald story begins, and I quote: Morse’s arrest about 36 hours after the grisly President Aristide has been governing As they changed out of their bloody murder, and Stanley’s surrender shortly after 11 p.m. Sunday, police learned in inter- by decree because elections were not clothes, the men who plunged a knife into an held in the constitutionally mandated elderly Avon man 27 times bragged they were views with Morse and the trio’s associates ‘‘natural born killers,’’ a Norfolk County that the men and their female friends ‘‘on period. prosecutor said yesterday. occasion’’ watched ‘‘Natural Born Killers’’ All reports out of Haiti indicate con- ‘‘Haven’t you ever seen ‘natural born kill- after one person bought the movie, said fusion and chaos in the electoral proc- ers’ before?,’’ 18-year-old suspect Patrick T. State Police Trooper Brian L. Howe. ess. Hundreds of thousands of Haitians Morse allegedly bragged to a girl after the ‘‘My understanding was they were drawing were waiting to vote 24 hours after gruesome slaying. a comparison between the characters in the polls were supposed to close. Some movie and themselves,’’ Howe said. According to the Norfolk County In Stoughton District Court yesterday, polling stations opened very late, and prosecutor, ‘‘This is one of the most vi- Morse and Stanley sat expressionless as some never opened at all. An election cious premeditated murders I have ever Pudolsky recited the threesome’s alleged station was burned in northern Haiti. seen.’’ And Massachusetts State Police vile deeds. Turnout was low. S 9132 CONGRESSIONAL RECORD — SENATE June 27, 1995 According to information my office What happened to 1 million voter who observed disturbing irregularities at received from Haiti today, the ballot registration cards missing before elec- BEC level (regional collection and counting counting process is in total disarray. tion day? Why were voter registration station). I have asked our delegation to de- termine the extent of these abuses for our The final results are not yet in, but the records unavailable on election day, evaluation of the count. The problems in this early returns indicate deep flaws in the and then being destroyed 48 hours electoral process can only complicate the process leading up to the election, deep later? strengthening of democracy in Haiti. flaws on election day, and now a com- Why was there a complete lack of Frankly, the Haitian people deserve better. plete breakdown of the process. All the ballot security on election day and sub- We saw their remarkable dignity and endur- signs point to an election process that sequently? ance yesterday while trying earnestly to par- is fatally flawed. Why were thousands of ballots and ticipate in an arbitrary process. We share a common objective with others in the inter- There are credible reports of ballots tally sheets destroyed and discarded national community—we all want a better being destroyed, and of nonexistent before any official count was recorded Haiti and a stronger democracy here. IRI is ballot security. No one knows when or finalized today in Port au Prince not here to certify this election. Only the ballot counting will be completed—or and other departments? Haitian people themselves have the right to if it can ever be done credibly. Are the verifiable cases of ballot sub- determine the legitimacy of this process. Al- You may have seen a picture of bal- stitution part of a national pattern to ready several major parties have issued lot security in the Washington Post influence the outcome of the elections? statements challenging the integrity of the this morning, boxes and boxes of bal- Why was President Aristide silent on process. We must take their judgements seri- ously. lots stacked up and ballots spilling out key issues of election integrity in the Let me share with you our observations of the boxes. days before Sunday’s balloting? about yesterday’s events. We received radio Witnesses today cite cases of ballots Who in the government and police and telephone reports from IRI delegates in being shoveled into trash containers, force played a role in the undermining the field from Les Cayes to Fort Liberte. To- and left in the street. of Haitian democracy? gether, the IRI delegates have visited during The International Republican Insti- What has happened to the millions of the course of election day about 500 BIVs tute [IRI] documented dozens of short- dollars in election assistance given to (local polling stations). Our delegates in Jacmel and Jermie reported an election we comings in the months and weeks lead- Haiti—amid rumors that elections ing up to the election. The IRI delega- had hoped for—sufficiently organized, whose workers will not be paid? irregularities were overcome by the Haitian tion, headed by Congressman PORTER Is the election chaos in Haiti orches- people and the electoral workers themselves. GOSS, issued a statement yesterday ti- trated, as charged by credible inter- For myself, the only normal process I ob- tled: ‘‘Irregularities Mar the Electoral national observers on the scene today? served was at Cabaret, which is doubly ironic Process.’’ The IRI statement details These and other issues deserve seri- because it used to be Duvalierville, the grave concerns with the Haitian elec- ous scrutiny—not just cheerleading. former dictator’s Potemkin Village. Our del- tions. The Haitian election process is at a egates throughout the departments in the north reported graphically about the closing The International Republican Insti- standstill. I believe the election proc- tute deserves credit for its honest and of the BIVs, the intimidation of politicians ess in Haiti should be judged by the and the burning down of the BEC in Limbe. serious effort to expose flaws in the same standard used for other elections Today in Port-au-Prince our delegates ob- Haitian election process. The inter- in other parts of the world—the Hai- served the use of xeroxed ballots, and early national community should not just tian people deserve no less. The elec- this morning we witnessed tally sheets being stand by and applaud a deeply flawed tion observers have left the country intentionally altered and ballots being sub- election. As Chairman GOSS’ statement but IRI is still on the ground asking stituted with newly marked ballots. This oc- noted yesterday, ‘‘The Haitian people the tough questions. I am confident curred in the Delmas BEC, not 10 minutes from where we are today. This raises the se- deserve better.’’ Congress will fully examine all issues In light of the work done by IRI, it rious possibility of the political manipula- associated with the Haitian elections tion of this election. was all the more surprising to see the in the coming weeks. So let me take a step back and point out Washington Post editorialize today I ask consent that a summary of the a positive aspect of these elections. Through- against IRI’s work. The Post claimed preelection analysis and the Inter- out the country, all of us were surprised and IRI’s criticism was not informed or national Republican Institute state- impressed by the significant presence of po- constructive, but misunderstood the ment of June 26, 1995, be printed in the litical party observers. I would like to give tough effort to rehabilitate Haiti. I credit to the Haitian private sector who RECORD. filled a crucial void by providing the nec- agree the effort to rehabilitate Haiti There being no objection, the mate- will be tough—but it will not be served essary support to field these pollwatchers. rial was ordered to be printed in the The Center for Free Enterprise and Democ- by turning our eyes from the very real RECORD, as follows: racy (CLED) deserves credit for putting this problems in Haiti, or from an election INTERNATIONAL REPUBLICAN INSTI- bold initiative together in 48 hours. that is fraught with problems. This is TUTE, Let me summarize our grave concerns: not a Republican view—it is an honest Washington, DC, June 26, 1995. Security: The international military served as a deterrent to widespread violence assessment of the facts. The New York IRREGULARITIES MAR ELECTORAL PROCESS— Times today reported that the Haitian for these elections. However, the issue of per- STATEMENT BY REP. PORTER GOSS (R–FL), sonal security for those participating in this election unraveled further yesterday. DELEGATION CHAIRMAN political process remains a serious concern. The mayor of Port au Prince, an old Good morning. This is our second press This issue was permeated every step of the ally of President Aristide, said yester- conference. On Saturday, the International process, affected the quality of the cam- day: ‘‘There has been massive fraud. It Republican Institute (IRI) released its pre- paign, the environment in which this elec- does not seriously advance the proc- electoral assessment in which we expressed tion occurred and clearly lessened voter par- ess.’’ our concern over a number of issues. They ticipation. It was magnified yesterday by I expect hearings into Haiti’s elec- include the implications of the failure of the threatened electoral workers and intimi- tion to begin as soon as the Senate re- electoral authorities to create an open, dated and harassed candidates. Yesterday, transparent and verifiable process; the dis- violent incidents closed BIVs in Port-au- turns from recess in July. Instead of qualification of parties and candidates; the Prince, Limbe, Port de Paix, Don Don, criticizing the monitors of the elec- lack of adequate training for electoral work- Ferrier, Jean Rabel, Carrefour and Cite tion, the Post should look for answers ers; and the failure to conduct any civic edu- Soleil. These actions disenfranchised an to the tough questions: cation to encourage voter participation. undeserving Haitian population. Without Why were thousands of candidates re- Today, all of us here have seen the con- visible security, BIV authorities were forced jected by the election council in total sequences of these failings. to close the polls and in other cases voters secrecy? I want to underscore the fact that our dele- went home without casting their votes. Why was an official list of candidates gates are still in the field throughout the Voter Materials: The CEP failed to deliver nine departments sending in reports. Elec- and distribute voter materials in the nec- never released? tion day has only recently come to an end essary time frame. Many BIVs also received Why weren’t election administrators and the counting continues. Our serious con- incomplete election material packages. This trained until it was too late—despite cern about the total lack of ballot security is resulted in countless delayed BIV openings. the availability of millions in inter- being borne out as I speak. We received re- This created enormous voter frustration and national assistance for such training? ports from our delegates early this morning even postponed the elections in La Chapelle. June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9133

Unpaid Elections Workers: As noted in our HAITI—IRI PRE-ELECTORAL ASSESSMENT OF Three political parties withdrew from the pre-electoral assessment, the failure of the THE JUNE 25, 1995, LEGISLATIVE AND MUNICI- process as a form of protest. CEP to pay thousands of electoral workers PAL ELECTIONS, JUNE 24, 1995 ELECTORAL ENVIRONMENT was attributed as one of the reasons for ab- I. EXECUTIVE SUMMARY A concern for security is an issue that has senteeism which delayed and closed many On June 25, 1995 Haiti will hold elections permeated every step of the process. The as- BIVs. Demonstrations were reported in sev- for 18 Senators, 83 Deputies, 135 mayors and sassination of Mireille Durocher Bertin, a eral departments. 565 community councils. These elections well-known lawyer and leading political op- Administration Capability: As noted in our were originally to be held in December but ponent of Aristide, only confirmed the fears pre-electoral assessment, electoral workers were postponed several times for a variety of of the parties and candidates. During the cri- received minimal or no training on the du- reasons. sis, many elected representatives feared re- ties and procedures. This resulted not only This election occurs at a pivotal time for turning to their districts, contributing to in lengthy delays but jeopardized the secu- Haiti as it struggles to rejoin the family of the decay of political infrastructure. Can- rity and secrecy of the process. democratic nations and offer renewed hope didates have curtailed their campaign activi- Secrecy of the Ballot: There was of stability for its people. This election is ties and have given personal security a high- also critical for the international commu- er priority. widespread disregard for the secrecy of nity as it seeks a benchmark to demonstrate The campaign itself began late and has this process. IRI and other delegates the transition from an internationally domi- been barely visible until some activities in reported that the ballot box seals were nated country to a Haiti governed by Hai- the last week prior to elections. Given the rarely used. Additionally, the setup of tians. For many in the international commu- process and environment surrounding these most BIV’s did not afford voters se- nity, these issues have made the holding of elections, it is doubtful many of Haiti’s rec- crecy in marking their ballots. an election far more important than the ognized political parties could have com- quality of the election. IRI has sought to peted effectively. Security of the Ballot: The most fla- evaluate the pre-electoral process and envi- The electorate itself is basically unin- grant lack of control occurred from the ronment for their comparision to minimal formed about this election—what it stands point of the count to the BEC level. standards of acceptability. for and who is running. There has been no Upon arrival of the ballots at the ELECTORAL PROCESS civic education campaign, with the excep- BEC’s, observers reported a lack of The legal foundation for these elections tion of some limited U.S. and U.N. military control of used and unused ballots. The was a Presidential decree that subverted the efforts, to illuminate the purpose of this most egregious examples of this known legislative process. election. Similarly, there has been no educational to IRI occurred in the Delmas BEC The formulation of the Provisional Elec- toral Council (CEP) itself breached an agree- campaign on how to vote, which for a largely where clean ballots were marked and illiterate population in Haiti could pose seri- substituted for ballots that had arrived ment between the President of the Republic and the political parties to allow the parties ous difficulties on election day. Compared to other ‘‘transition elections’’ from the BIV’s; tally sheets were al- to nominate all candidates from which CEP observed by IRI, such as in Russia in 1993, El tered. members would be chosen by the three Salvador in 1994, South Africa in 1994 and branches of government. Only two of the Disqualification of Candidates: The even China’s Jilan Province village elections nine CEP members were chosen from the thoroughly arbitrary process of quali- in 1994, the pre-electoral process and envi- fying candidates led to serious con- parties’ list. The voter registration process, to have ronment in Haiti has seriously challenged sequences which we anticipated in our been administered by the CEP, was com- the most minimally accepted standards for pre-election report. While some argued plicated by miscalculations of population the holding of a credible election. that the number of candidates that size, lack of sufficient materials and reg- f were disqualified was not statistically istration sites, and one million missing voter significant, it proved on election day to registration cards. PRIVATE SECURITIES LITIGATION destabilize the electoral environment The CEP review of the over 11,000 can- REFORM ACT in certain areas. The results of this didate dossiers for eligibility was a pro- The Senate continued with the con- tracted process that occurred under a cloak ranged from a low voter turn out in sideration of the bill. of secrecy. When the CEP made its decisions The PRESIDING OFFICER. Under Saint Marc where five candidates for known, by radio, no reasons were given for magistrate were left off the ballot to the thousands of candidates rejected. After the previous order, the Chair recog- Jean Rabel, where it was reported that vehement protests by the parties, some rea- nizes the Senator from Maryland to followers of independent candidate sons were supplied and supplemental lists offer an amendment. Henry Desamour burned ballots and were announced through June 14, thirty-one AMENDMENT NO. 1478 closed BIV’s because his name did not days after the date the final candidate list (Purpose: To amend the safe harbor appear on the ballot. was to be announced. This stripped the CEP provisions of the bill) of its credibility with the political parties. Mr. SARBANES. Mr. President, I Voter Turnout: IRI delegates re- There is still not a final list of approved can- ported low to modest voter turnout in didates available. send an amendment to the desk and the BIV’s they visited. If this remains The sliding scale of registration fees im- ask for its immediate consideration. The PRESIDING OFFICER. The the case, we believe that it is the con- posed by the CEP—whereby political parties clerk will report. sequence of a compressed election with fewer CEP approved candidates pay larger fees—has made it difficult for many The assistant legislative clerk read timetable, a lack of civic education, parties to compete. As of June 20, five days as follows: and frustration with the electoral proc- before the election, protests against this un- ess. The Senator from Maryland [Mr. SAR- usual requirement have gone unanswered. BANES] proposes an amendment numbered It was important for Haiti and the The ability of the CEP and those under its 1478. direction to administer an election is un- international community to hold this On page 114, strike lines 7 and 8, and insert clear. As of June 20, five days prior to the the following: election, but holding an election is election, formal instructions for the proce- ‘‘(1) made with the actual knowledge that simply not enough. The purpose of this dures of election day and the count has yet it was false or misleading; election was to create layers of govern- to be issued; this has prevented the 45,000 On page 121, strike lines 1 and 2, and insert ment that can serve as checks and bal- persons needed to administer election day the following: ances on each other and decentralize from receiving specific training. ‘‘(1) made with the actual knowledge that As of June 20, those persons designated by power as envisioned by the 1987 Con- it was false or misleading; the political parties as pollwatchers had not stitution. That is why it was important The PRESIDING OFFICER. The Sen- to have an inclusive process, not one yet received any training from the CEP which could lead to serious confusion on ator from Maryland. marked by exclusion. election day. Mr. SARBANES. Mr. President, the It has been IRI’s intent throughout These actions have led to deep misgivings previous amendment, the one we just this process to be thorough, independ- across the Haitian political spectrum about considered, which was not adopted on a ent, objective and constructive. In this the ability of the CEP to fulfill the mandate vote of 43 to 56, would have sent the regard, IRI will maintain a presence in and functions normally executed by election commissions. Political parties had no idea to matter of defining the parameters of Haiti through the final round of elec- whom to turn with complaints in the proc- the safe harbor exemption to the Secu- tions and will make recommendations ess—the CEP, the President of the Republic, rities and Exchange Commission. for the formation of the permanent the United Nations Electoral Assistance I, of course, argued very strenuously electoral council. Unit or the United States Government. in the consideration of the amendment S 9134 CONGRESSIONAL RECORD — SENATE June 27, 1995 that that is where this ought to be they oppose the amendment, why they knowledge that it was false or mislead- done, that it ought not to be done, believe a forward-looking statement ing have immunity from liability for well, in the committee and now in this made with the actual knowledge that that forward-looking statement? Chamber, because the existing defini- it was false or misleading ought to be That is the issue that is before us by tion in the bill has already been protected from liability. this amendment. It was my preference amended. Mr. President, this is an issue of sig- that this issue be worked out by the The Senate did not adopt that provi- nificance and moment. We have heard Commission. I thought that is where it sion, and the question now arises, if from the various securities regulators ought to go in terms of expertise. you are going to have a statutory defi- in opposition to the provision in the If Members want to deal with it here nition, what should it be? What should committee bill. The National Associa- on the floor, then we need to examine it be? tion of Securities Dealers has written it on the standard, address the stand- This amendment that has been sent to us in opposition to it, as has the ard that is in the bill, why I think it to the desk would strike out the lan- Government Finance Officers Associa- opens, as the Government Finance Offi- guage that is in the bill. What the bill tion. SEC, of course, I have already cers said, a major loophole, or which, says is that the exemption from the li- quoted their statement. But let me just as the Chairman of the Commission ability provided does not apply to a point out the Government Finance Of- said, would allow willful fraud to re- forward-looking statement that is ficers Association, which represents ceive the benefit of safe harbor protec- knowingly made with the expectation, more than 13,000 State and local gov- tion. That ought not to be the case. purpose, and actual intent of mislead- ernment financial officials, county Therefore, I propose to substitute the ing investors. treasurers, city managers, and so on, language ‘‘made with actual knowledge Earlier the Senator from New York and which issues securities and invests that it was false or misleading.’’ No modified that and struck the word ‘‘ex- billions of dollars of public pension and statement made with the actual knowl- pectation,’’ but the problem still re- public taxpayer funds every year, edge that it was false or with the ac- mains, the essential problem which wrote of the safe harbor provision in tual knowledge that it was misleading prompted the Chairman of the Securi- the bill, the standard that we are seek- ought to have safe harbor protection. ties and Exchange Commission to say, ing to change, the one in the bill which Mr. President, I yield the floor. and I quote him, ‘‘I cannot embrace says knowingly made with the purpose Mr. D’AMATO addressed the Chair. proposals which allow willful fraud to and actual intent of misleading inves- The PRESIDING OFFICER. The Sen- receive the benefit of safe harbor pro- tors, ‘‘We believe this opens a major ator from New York. tection.’’ loophole through which wrongdoers Mr. D’AMATO. Mr. President, what So we are now into the question, if could escape liability while fraud vic- we are talking about now is what we the standard in the bill is inappropri- tims would be denied recovery.’’ call in legal jargon the scienter stand- ate, as I believe strongly it is, and as Let me repeat that: ‘‘We believe this ard. It is not an easy one. It can be dif- has been indicated by the Chairman of opens a major loophole through which ficult to understand. And indeed it can the Securities and Exchange Commis- wrongdoers could escape liability while open up an incredible loophole, one sion, and indeed by other securities fraud victims would be denied recov- that we are attempting to deal with; regulators, State securities regulators, ery.’’ that is, to permit people to make pro- by Government finance officers and The provision in the bill requires you jections. And they must state—I can others, all of whom in a sense are out- to show the actual intent of the parties have that disclaimer—they must state side the controversy amongst the eco- making the forward-looking state- this is a projection, this is a projection, nomic interests associated with this ment. Not only that, you have to show and that it may not be accurate. I will bill, and represent the public interest, that it was knowingly made with the get the exact verbiage. It may not be the question now is, is this standard so purpose of misleading investors. And as accurate. difficult that all but the most egre- originally written also the expectation, Whole classes of issuers are exempt- gious fraudulent efforts would be ex- although that was stricken earlier in ed, the penny stocks, the mergers and empted from liability. And I submit our consideration. So it is now know- acquisitions. ‘‘Refers clearly that such that it is, and the amendment I have ingly made with the purpose and actual projections, estimates, or descriptions sent to the desk is an effort to modify intent of misleading the investors. are forward-looking statements and that. The standard provided for in that That is what you have to dem- the risk that the actual results may amendment is made with the actual onstrate in order for the forward-look- differ materially from such projec- knowledge that it was false or mislead- ing statement to lose its immunization tions, estimates, or descriptions’’ has ing. from liability. And that is a standard to be included. Let me repeat that: Made with the that is so extreme that the Chairman Now, let us read the language, be- actual knowledge that it was false or of the Securities and Exchange Com- cause I have heard this, and I have seen misleading. mission wrote to us and said, ‘‘I cannot it written, too. It is inaccurate to de- There are forward-looking state- embrace proposals which allow willful scribe this bill as giving a license to ments that would be exempted from li- fraud to receive the benefit of safe har- people to knowingly, with intent, de- ability under the standard in the bill bor protection.’’ And that is the provi- fraud. It is just wrong. that would not be exempted from li- sion which the Government Finance Here is the language in the bill. We ability under the standard of this Officers Assocation said, ‘‘We believe modified it today because I thought amendment. this opens a major loophole through there was one standard that might go The question then becomes, is the which wrongdoers could escape liabil- above and beyond. The exemption from standard in this amendment an appro- ity while fraud victims would be denied liability provided for in subsection A priate one? And I defy anyone to ad- recovery.’’ does not apply. It does not apply. In vance a rationale why a forward-look- The amendment that I have sent to other words, you get no exemption. ing statement made with the actual the desk very simply states that the Then on page 114, line 4, it says: knowledge that it was false or mislead- exemption from liability is lost for a (c) EXCLUSIONS.—The exemption from li- ing should be protected from liability. forward-looking statement that is ability provided for in subsection (a) does I have heard people talk, oh, we are not made with the actual knowledge that not apply to a forward-looking statement going to allow knowing fraud to be pro- it was false or misleading, very simply that is— tected. put. You make a forward-looking state- In other words, you get no exemp- That is exactly what this amendment ment, and you make it with the actual tion. provides. It says that the exemption knowledge that it was false or the ac- (1) knowingly made with the expectation, from liability provided for in this bill tual knowledge that it was misleading, purpose, and actual intent of misleading in- does not apply for a forward-looking and you lose your immunity. You lose vestors. statement that is made with the actual your immunity. So if you knowingly make a false knowledge that it was false or mislead- Why should anyone who makes a for- statement, knowingly, with the pur- ing. And I want to hear from others, if ward-looking statement with an actual pose and actual intent of misleading June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9135 investors, you are not protected. And it, by Senator DODD. He happens to be should be sued, no doubt; absolutely. that is as it should be. These are pro- correct. They are sharks who are look- There is nothing that keeps the SEC jections. Now, I have to ask the ques- ing to eat whatever they can and the from doing this, from bringing these tion, who knows what someone knows, devil may care as it relates to the suits. Our bill does not protect fraudu- what is knowledge to them? And once harm and the injury that they bring, in lent statements or conduct. The ad- you have that, once you say, if you many cases, to good people simply by ministration does not say that it does. knowingly made this, all they have to being able to allege that someone It does not say that it does. do—the plaintiffs bar this particular knowingly made a misleading state- A letter, from Abner Mikva, counsel group, very small group —is allege that ment. to the President, asked for clarifica- you knowingly made a false statement. We say, no, you have to go a little tion. I do not think that our bill is un- The burden now comes upon that per- further. Knowingly, and you have to clear on this point. I can clarify it. If it son who has this complaint filed show intent. Because who knows what is, this debate should provide impor- against them to prove that they did ‘‘knowingly’’ is. Show me. You say: I tant guidance that the bill does not not. How do you prove it? How do you allege you knew it. I say I did not and will not protect fraud. I think this prove it? That is why we say, look, it know. But if one has to allege that you is clarification enough. How many has to be a little tougher. You cannot knew and you had intent, that is a lit- times should we state it? We do not do say, ‘‘You knowingly made this. You tle more difficult; is it not? I think it, we will not do it, that is not my in- knowingly made this, knowingly, with people are entitled to that presump- tent, and I urge my colleagues to op- intent, with the purpose to mislead in- tion. I do not think they should be sub- pose the amendment by my distin- vestors.’’ It seems to me that that is jected to these scurrilous lawsuits. And guished colleague and friend from pretty reasonable. they have taken place. That is why we Maryland. If a person does that, then you should say ‘‘knowingly, with intent,’’ and that Mr. SARBANES addressed the Chair. go after them and hold them. We do. you deliberately did this to mislead in- The PRESIDING OFFICER. The Sen- They are not exempt. We get down to vestors. ator from Maryland. the issue of splitting legal hairs and It is one thing to have people sub- Mr. SARBANES. Mr. President, the opening the doors for this group of ban- jected to suits where there is intent to distinguished Senator from New York dits. That is what they are, bandits, ab- deliberately mislead, and it is another read the standard that is in the bill, solute bandits; this is the group that, thing where people have made acci- and that is the problem, that standard. you know, suggests that we make it dents and now are held to a standard Those who are knowledgeable in the se- easier to bring these kinds of suits. We whereby that was an accident and they curities field have looked at that do not want to make it easier to bring say, ‘‘You knew.’’ You say, ‘‘I did not standard and reached the conclusion suits that have no merit, where people know.’’ You did and you actually made, that it is an enormous loophole, and it allege someone knowingly, falsely if the fellow actually made the state- will enable people to engage in willful made these statements. All you have to ment, he made the statement. Nobody fraud. do is allege someone made the state- can say he actually did not. So the The amendment which I sent to the ment. Bingo, we have not solved the word ‘‘actually,’’ that is nothing. They desk, which would change that lan- problem. That brings us right back say you have knowledge, claim you guage, would not allow a forward-look- into court and brings us into the situa- have knowledge. Wait, I did not know ing statement to claim exemption from tion where a person gets sued for mil- that it was wrong. I got you in court liability where the statement was lions, and has to settle for millions of because all I had to do is say that, well, made with the actual knowledge that dollars and/or pay millions of dollars in you did. You had actual knowledge, it was false or misleading. legal fees against claims that would and if you checked your papers, you What every Member has to ask them- otherwise be worthless and should get would have found out that the projec- selves is on what possible basis would no dollars. tions you were making were off. Now I you want to give immunity to a for- I have to tell you something; that we have him in under a claim of actual ward-looking statement that was made have sat back for far too long in deal- knowledge. with the actual knowledge that it was ing with this because it was really a Did he really have actual knowledge? false or with the actual knowledge that very small and almost insignificant No. But it is very easy to allege. And it was misleading? I submit to you, portion of the population that was af- once you allege it, you have him in this statements of that sort ought not to be fected. We did not see on a daily basis revolving door, in the chain. What do protected from immunity. The bill, as lawsuits being brought with no claim. his lawyers say to him? ‘‘We can fight written, would, in effect, allow state- We did not see where we had, for exam- it. We may be able to win it.’’ But you ments made of that sort to have pro- ple, of 229 cases filed, 229 cases filed, 38 know what? You may stand to lose, if tection from immunity. percent used the same repeat plaintiffs; they get a judgment against you, tens The standard in the bill is so high 38 percent used the same cadre. In of millions of dollars, and put the com- and so narrow that virtually any for- other words, they were professional pany—a startup company —out of busi- ward-looking statement is going to plaintiffs. And I have to tell you why ness. Or if you are an accountant, yes, have immunity. The burden of showing we may have cured that and said—by we can probably win it. But you can purpose and actual intent—before, of the way, they were paid bonuses. These get hit pretty hard. Because you know, course, we also had expectation which people, for letting their names be used, these people made this and you saw it the Senators struck from the bill—but got $15,000, $20,000, $25,000 for being pro- and they dragged you in. to show purpose and actual intent is so fessional plaintiffs. I think that when you look at and heavy that a lot of very fast games by So when we talk about protecting the read what we have put in, not what some very fast artists are going to be little guy, we are not protecting the somebody puts in substitution, tell me played on the investing public and is little guy. What we are trying to do is how you can read this bill and say, going to cause a lot of people a great put a stop to and really protect the in- anybody, that we say that you can de- deal of grief and harm and damage. vestors who have their money invested liberately lie and mislead with intent, So I urge Members to examine this in these small companies, who have the and that we give you safe harbor for issue very carefully. This is one of mutual funds, who have those pension that? We do not. those issues that will come back to funds, which represent trillions of dol- I want to do it, and I will sit down haunt you because people are going to lars and truly represent millions of and read once more, there is no exemp- be swindled, they are not going to be people. Give them an opportunity. Give tion from liability where, line 7, a for- reachable because of the immunity them a say. And do not have their com- ward looking statement is: which the bill provides, and everyone is panies savaged by people who are only (1) knowingly made with the expectation, going to look at what they did and say, looking to take care of their own inter- purpose, and actual intent of misleading in- ‘‘Why should these people be immu- ests. And those are the buccaneering vestors. nized from liability,’’ and the respon- barristers, those lawyers. The term was They are not protected. You can be sibility for immunizing them is going coined, at least the first time I heard sued. And if that is the case, you to rest on the people voting on this S 9136 CONGRESSIONAL RECORD — SENATE June 27, 1995 amendment and voting on this legisla- that, and a fairly narrow margin of the Administration urged the Senate to clarify tion. Members of this body supported him in whether the safe harbor’s current language So I very strongly urge the adoption that view and, therefore, the burden would protect statements known to be mate- of the amendment. falls upon us to define the standard rially false or misleading when made. The Senate can best ensure that the safe-harbor Now, the letter to which my col- here. would not protect fraudulent statements by league referred is a letter from the The SEC and the State regulators adopting an actual knowledge standard, as counsel to the President, Judge Mikva. have told us that the standard, as writ- your amendment proposes. I ask unanimous consent that the let- ten in the bill, will protect fraud art- Sincerely, ter be printed in the RECORD at the end ists. In effect, the bill swings the pen- ABNER J. MIKVA, of my remarks. dulum too far and the language of the Counsel to the President. The PRESIDING OFFICER. Without bill goes too far and, therefore, will end Mr. D’AMATO. Mr. President, I think objection, it is so ordered. up protecting fraud and hurting inves- we have debated this point now over (See exhibit 1.) tors. and over. First, let me say, that if the Mr. SARBANES. Mr. President, I This amendment is an effort to bring Securities and Exchange Commission quote: the pendulum back toward the middle. has constructive suggestions to make The White House It still will provide an enhanced safe in this area, we stand ready, willing, Washington, June 27, 1995. harbor over what now exists, but it will and able to adopt them. We would be DEAR SENATOR SARBANES: I am writing to not go to the extreme lengths of the happy to have hearings. But, we have express the administration’s support of your provision in the bill which all the ex- been waiting for the safe harbor stand- amendment to S. 240. The administration perts tell us, all the people whose re- ards for 3 years, and we finally have strongly believes the bill’s safe harbor provi- sponsibility it is to deal with securities felt compelled to create the safe harbor sion should not protect a statement made fraud, who work in the field full-time ourselves. Once again, I direct my col- with the actual knowledge that it was false all the time, they all tell us that this leagues to the letters from Chairman or misleading. will end up protecting fraud artists. As Levitt. He has shared with us the frus- Let me repeat that: I said, the Chairman of the SEC said: tration and problems that the business . . . should not protect a statement made I cannot embrace proposals which allow community face. He alludes to these with the actual knowledge that it was false willful fraud to receive the benefit of safe problems and he has recognized that or misleading. harbor protection. there is a need to begin solving these The bill’s current safe harbor standard That is what we are talking about problems. would exclude forward-looking statements here. The substitute standard which I ‘‘knowingly made with the expectation, pur- Now, if you look at the language of pose, and actual intent of misleading inves- am proposing simply says that you are my friend and colleagues’ amendment, tors.’’ not going to give protection from li- and then look at the language in S. 240, And as I noted, let me depart from ability to a forward-looking statement as it currently exists, it is very clear —listen very carefully to this—to a for- the text of the letter for a moment, not that the current language means that ward-looking statement that is made very long ago, earlier in our proceed- if you knowingly make a statement with the actual knowledge that it was ings, the Senator from New York with the purpose and intent of mislead- false or misleading. You cannot make struck the word ‘‘expectation’’ from ing investors you will be held liable. the statement with actual knowledge the standard that is in the bill. This current standard means that you that it is false or actual knowledge So he continues then, it now reads: have to demonstrate that this state- that it is misleading and be protected ment was made with an intent to mis- ‘‘knowingly made with the purpose, and from liability. And I invite anyone to lead investors. However, the Sarbanes actual intent of misleading investors.’’ explain to me why that kind of state- amendment would reduce that stand- I double checked, and I am told that ment ought to get protection from li- ard to just knowing a misstatement does not affect the import of this let- ability. I would think it is as clear as was made. That is too easy to allege. ter, and that knowing of that change, can be that is the very sort of state- That opens the door to meritless suits the letter still stands as sent to us. I ment that ought not to get protection and that then forces firms to pay huge double checked that in order to be very from liability. Therefore, I say to my settlements. That is what we are at- accurate with my colleagues. colleagues, if—as apparently has been tempting to stop. The letter goes on to say: decided—we are going to write the We cannot countenance lying nor can The Securities and Exchange Commission standard right here, clearly, we must we countenance the making of false has opposed the use of this standard because rewrite the standard in the bill. I sub- statements. But the fact of the matter it might allow some defendants to avoid li- mit that the standard contained in the is, if we use this scienter provision, it ability for certain false statements. amendment is an appropriate standard, will open the door to meritless litiga- In the Statement of Administration Policy forwarded to the Senate on June 23, 1995, the if we are going to be concerned about a tion based only on allegation. This will administration urged the Senate to clarify proper balance that will help to provide prove to be a nearly impossible stand- whether the safe harbor’s current language some insurance that investors will not ard—how does one prove that he actu- would protect statements known to be mate- be subjected to fraud. ally did not know and was not aware of rially false or misleading when made. The Mr. President, I yield the floor. the misstatement? How does one prove Senate can best ensure that the safe harbor EXHIBIT 1 that? That is the high burden that we would not protect fraudulent statements by THE WHITE HOUSE, place on the defendant with this stand- adopting an actual knowledge standard, as Washington, DC, June 27, 1995. ard. With this standard, I feel that your amendment proposes. Hon. PAUL SARBANES, firms will be forced to settle and that Let me repeat that: U.S. Senate, means payments of millions of dollars. The Senate can best ensure that the safe Washington, DC. Mr. President, I ask for the yeas and DEAR SENATOR SARBANES: I am writing to harbor would not protect fraudulent state- nays. ments by adopting an actual knowledge express the Administration’s support of your amendment to S. 240. The Administration The PRESIDING OFFICER. Is there a standard, as your amendment proposes. sufficient second? Sincerely, strongly believes the bill’s safe harbor provi- sion should not protect a statement made There is a sufficient second. ABNER J. MIKVA, The yeas and nays were ordered. Counsel to the President. with the actual knowledge that it was false or misleading. Mr. DODD. Mr. President, how much Mr. President, my colleague from The bill’s current safe-harbor standard time remains? New York has suggested, well, we are would exclude forward-looking statements The PRESIDING OFFICER. There is just splitting legal hairs here. We are ‘‘knowingly made with the expectation, pur- no control of time. engaged in some difficult legal analy- pose, and actual intent of misleading inves- Mr. DODD. Thank you. Mr. Presi- sis, that is quite true. And I suggested tors.’’ The Securities and Exchange Commis- dent, let me commend my colleague that when we did the previous amend- sion has opposed the use of this standard be- from Maryland, first of all, for offering cause it might allow some defendants to ment that the place where this ought avoid liability for certain false statements. a creative amendment here. It looks to be done is by the SEC. The Senator In the Statement of Administration Policy tempting with the language that is of- from New York did not agree with forwarded to the Senate on June 23, 1995, the fered and the arguments he has given June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9137 as to why not just support the replace- change Commission is that the present to vastly expand the Commission’s role. The ment language that he has offered, safe harbor is not working. relief obtained from Commission which would strike paragraph one on We have heard at length earlier disgorgement actions is no substitute for pri- vate damage actions. Indeed, as government page 121 and paragraph one on another today, and maybe I ought to put in the is downsized and budgets are trimmed, the page—I apologize for not having the letter again, the letter of May 19, in investor’s ability to seek redress directly is page number—and replace what we now which the Chairman of the SEC identi- likely to increase in importance. have, ‘‘knowingly made with the pur- fies in paragraph 3 of that letter, To achieve our common goal of encourag- pose and intent of misleading inves- ‘‘There is a need for stronger safe har- ing enhanced sound disclosure by reducing tors,’’ to ‘‘actual knowledge of false bor than currently exists.’’ the threat of meritless litigation, we must and misleading information,’’ I believe Mr. President, I ask unanimous con- strike a reasonable balance. A carefully crafted safe harbor protection from meritless is the language of the amendment. sent this letter be printed in the private lawsuits should encourage public Let me begin, Mr. President, by stat- RECORD, because the Chairman of the companies to make additional forward-look- ing what I hope all of our colleagues SEC lays out why that problem exists. ing disclosure that would benefit investors. will accept is the point here. That is, There being no objection, the mate- At the same time, it should not compromise that we are all after the same goal— rial was ordered to be printed in the the integrity of such information which is certainly, those of us who have spent RECORD, as follows: vital to both investor protection and the effi- time over the last 3 or 4 years in trying ciency of the capital markets—the two goals SECURITIES AND EXCHANGE COMMISSION, of the federal securities laws. to deal with the broader issue that this Washington, DC, May 19, 1995. The safe harbor contained in H.R. 1058 is so legislation attempts to address. I have Hon. ALFONSE M. D’AMATO, broad and inflexible that it may compromise tried to strike a balance that will deal Chairman, Committee on Banking, Housing, investor protection and market efficiency. It with an existing problem that we have and Urban Affairs, U.S. Senate, Washing- would, for example, protect companies and identified over these last several days ton, DC. individuals from private lawsuits even where DEAR MR. CHAIRMAN: As Chairman of the in our debate. the information was purposefully fraudulent. Securities and Exchange Commission I have This result would have consequences not Let us also assume that we have no higher priority than to protect American some six, seven, eight pages here in the only for investors, but for the market as investors and ensure an efficient capital for- well. There would likely be more disclosure, bill that deal with the issue of safe har- mation process. I know personally just how but would it be better disclosure? Moreover, bor. An amendment being offered by deeply you share these goals. In keeping the vast majority of companies whose public the Senator from Maryland deals with with our common purpose, but the SEC and statements are published in good faith and one clause—an important clause, but the Congress are working to find an appro- with due care could find the investing public nonetheless one aspect of safe harbor. priate ‘‘safe harbor’’ from the liability provi- skeptical of their information. I said earlier today, Mr. President, sions of the federal securities laws for pro- I am concerned that H.R. 1058 appears to jections and other forward-looking state- that the purpose of safe harbor is de- cover other persons such as brokers. In the ments made by public companies. Several Prudential Securities case, Prudential bro- signed to encourage the disclosure of pieces of proposed legislation address the kers intentionally made baseless statements information, to encourage the disclo- issue of the safe harbor and the House-passed concerning expected yields solely to lure sure of information. There is no re- version, H.R. 1058, specifically defines such a customers into making what were otherwise quirement, under law, that companies safe harbor. extremely risky and unsuitable investments. disclose information to potential inves- Your committee is now considering securi- Pursuant to the Commission’s settlement tors. There may be those who want to ties litigation reform legislation that will with Prudential, the firm has paid compensa- require that, but the law does not re- include a safe harbor provision. Rather than tion to its defrauded customers of over $700 simply repeat the Commission’s request that million. Do we really want to protect such quire it. Congress await the outcome of our rule- So the very purpose of having a safe conduct from accountability to these de- making deliberations and thereby run the frauded investors? In the past two years or harbor is not just to create some island risk of missing an opportunity to provide so, the Commission has brought eighteen en- where people can make statements, fu- input for your own deliberations, I thought I forcement cases involving the sale of more turistic statements, and avoid litiga- would take this opportunity to express my than $200 million of interests in wireless tion or be immune, but because we personal views about a legislative approach cable partnerships and limited liability com- think it is important to elicit from to a safe harbor. panies. Most of these cases involved fraudu- businesses, from industry, from cor- There is a need for a stronger safe harbor lent projections as to the returns investors porations, statements about what they than currently exists. The current rules have could expect from their investments. Pro- largely been a failure and I share the dis- believe the company is likely to be moters of these types of ventures would be appointment of issuers that the rules have immune from private suits under H.R. 1058 as doing. been ineffective in affording protection for would those who promote blank check offer- Good news and bad news. It is not forward-looking statements. Our capital ings, penny stocks, and roll-ups. It should just good news. A forward-looking markets are built on the foundation of full also address conflict of interest problems statement can be bad news about what and fair disclosure. Analysts are paid and in- that may arise in management buyouts and may happen—product lines that are vestors are rewarded for correctly assessing changes in control of a company. not necessarily going to live up to ear- a company’s prospects. The more investors A safe harbor must be balanced—it should lier expectations. know and understand management’s future encourage more sound disclosure without en- I hope that everyone would agree plans and views, the sounder the valuation is couraging either omission of material infor- of the company’s securities and the more ef- mation or irresponsible and dishonest infor- that it is in the interests of our coun- ficient the capital allocation process. Yet mation. A safe harbor must be thoughtful— try economically to encourage busi- corporate America is hesitant to disclose so that it protects considered projections, nesses to be forthcoming about infor- projections and other forward-looking infor- but never fraudulent ones. A safe harbor mation which they possess that will mation, because of excessive vulnerability to must also be practical—it should be flexible allow for investors to make intelligent, lawsuits if predictions ultimately are not re- enough to accommodate legitimate investor reasonable decisions about whether to alized. protection concerns that may arise on both buy stock, sell stock, whatever else As a businessman for most of my life, I sides of the issue. This is a complex issue in they may be engaged in. That is why know all too well the punishing costs of a complex industry, and it raises almost as meritless lawsuits—costs that are ultimately many questions as one answers: Should the we create a safe harbor. That is the paid by investors. Particularly galling are safe harbor apply to information required by only reason for it. the frivolous lawsuits that ignore the fact Commission rule, including predictive infor- If you had a law that required busi- that a projection is inherently uncertain mation contained in the financial state- nesses to tell everything they know, even when made reasonably and in good ments (e.g. pension liabilities and over-the- you would not need safe harbor. No one faith. counter derivatives)? Should there be a re- is suggesting we do that. Proprietary This is not to suggest that private litiga- quirement that forward-looking information information, businesses trying to make tion under the federal securities laws is gen- that has become incorrect be updated if the plans for the future, should remain pri- erally counterproductive. In fact, private company or its insiders are buying or selling lawsuits are a necessary supplement to the securities? Should the safe harbor extend to vate. In the whole area of securities enforcement program of the Commission. We disclosures made in connection with a cap- litigation, the notion of safe harbor is have neither the resources nor the desire to ital raising transaction on the same basis as a longstanding notion. replace private plaintiffs in policing fraud; it more routine disclosures as well? Are there The problem, today, as identified by makes more sense to let private forces con- categories of transactions, such as partner- the Chairman of the Securities and Ex- tinue to play a key role in deterrence, than ship offerings or going private transactions S 9138 CONGRESSIONAL RECORD — SENATE June 27, 1995 that should be subject to additional condi- Now let me cite examples where I be- Senator from New York, and myself, tions? lieve that the actual knowledge stand- let me go back, there are 6 or 7 pages There are many more questions that have ard, as tempting as it is, can actually in the bill dealing with safe harbor. arisen in the course of the Commission’s ex- ploration of how to design a safe harbor. We just bring us back to the point we are This is one line in that entire section. have issued a concept release, received a trying to get away from, and that is Safe harbor only applies to state- large volume of comment letters in response, the litigation that has swamped up in ments by issuance and reviewers hired. and held three days of hearings, both in Cali- many ways in terms of the ability of Statements by stockbrokers are not in- fornia and Washington. In addition, I have these companies to move forward and cluded. Certain issuers are excluded met personally with most groups that might to, as I said earlier, to give the kind of from safe harbor, including anyone conceivably have an interest in the subject: information that may be necessary. found to have violated securities law, corporate leaders, investor groups, plaintiff’s lawyers, defense lawyers, state and federal We all want safe harbor, as I men- anyone involved in penny stocks, blank regulators, law professors, and even federal tion. We want a safe harbor that will check companies, investment compa- judges. The one thing I can state unequivo- work. When the chief executive officer nies, IPO’s, tender offers, roll-up trans- cally is that this subject eludes easy an- of a large industry goes to his general actions—all are exempted. Historical swers. counsel in a very practical way, and information contained in historical fi- Given these complexities—and in light of says ‘‘Should I tell pension fund inves- nancial statements is excluded as well. the enormous amount of care, thought, and tors,’’—remember, that is primarily I forget to mention this earlier, but work that the Commission has already in- vested in the subject—my recommendation who we are talking about— ‘‘that,’’ re- in this bill we require cautionary lan- would be that you provide broad rulemaking turning to an earlier example, ‘‘a new guage be included in forward-looking authority to the Commission to improve the disk drive at the heart of their invest- statements so investors can pick up safe harbor. If you wish to provide more ment in this company, may not quite the kind of language that ought to give specificity by legislation, I believe the provi- work as well as we planned.’’ them a better sense to put them on no- sion must address the investor protection We should have a safe harbor that tice that maybe these predictions are concerns mentioned above. I would support will allow the general counsel to say not going to turn out to either be as legislation that sets forth a basic safe harbor containing four components: (1) protection ‘‘Yes, you can say this without being bad or as good as the company may from private lawsuits for reasonable projec- sued.’’ It is so the company now has utter and say. That was never before tions by public companies; (2) a scienter this information, not required by law, required. standard other than recklessness should be that it share that information. But the In the discussion of safe harbor, re- used for a safe harbor and appropriate proce- CEO says, ‘‘I do not think this disk member, we are dealing with narrow dural standards should be enacted to discour- drive will work quite as well as I fact situations here. age and easily terminate meritless litiga- planned, and I want to know whether Mr. D’AMATO. Will my friend yield tion; (3) ‘‘projections’’ would include vol- or not to let people know,’’ knowing for a question? untary forward-looking statements with re- spect to a group of subjects such as sales, full well what may be the implication Mr. DODD. I yield. revenues, net income (loss), earnings per in terms of the investors. Mr. D’AMATO. Is it not true that one share, as well as the mandatory information Pension funds obviously, I think, are of the other provisions never included, required in the Management’s Discussion entitled to information even if it is not safe harbor will now permit the SEC to and Analysis; and (4) the Commission would required to be disclosed. We want to bring suits for disgorgement, for viola- have the flexibility and authority to include make sure that CEO’s can say and tell tion of safe harbor provisions? or exclude classes of disclosures, trans- us what is going on without the fear of Mr. DODD. I was just about to get to actions, or persons as experience teaches us that point. That is a second added new lessons and as circumstances warrant. millions of dollars in litigation costs. As we work to reform the current safe har- That is the point of this bill—trying to provision. bor rules of the Commission, the greatest reduce litigation costs. Mr. D’AMATO. That has never been problem is anticipating the unintended con- If we do not make this a very clear in before? sequences of the changes that will be made division, a very clear division, as to Mr. DODD. Never before in this legis- in the standards of liability. The answer ap- when safe harbor does not apply, it is lation. It is all new authority we are pears to be an approach that maintains flexi- not going to be safe enough, and that extending to the SEC. bility in responding to problems that may To listen to this debate, we would develop. As a regulatory agency that admin- general counsel is then going to say to isters the federal securities laws, we are well that CEO, ‘‘You are not required to say think we have been stripping away and situated to respond promptly to any prob- anything—don’t say anything. Don’t stripping away. What we are doing is lems that may develop, if we are given the say anything.’’ providing different vehicles. As we lis- statutory authority to do so. Indeed, one Who are the winners and losers, when tened and heard testimony, the Council possibility we are considering is a pilot safe that decision is made? The general of Institutional Investors represents, I harbor that would be reviewed formally at counsel says ‘‘Don’t say anything here, said, millions of people in the country, the end of a two year period. What we have don’t you dare say anything. You are involving billions of dollars. today is unsatisfactory, but we think that, They want that information. These with your support, we can expeditiously not required to by law.’’ You can never build a better model for tomorrow. be sued for what he did not say in this pension funds want to know what is I am well aware of your tenacious commit- case. So they do not do anything. going on in these companies. If these ment to the individual Americans who are Mr. SARBANES. Will the Senator companies do not provide that kind of the backbone of our markets and I have no yield? information, these pension funds are doubt that you share our belief that the in- Mr. DODD. If I could finish this train not making decisions with all of the in- terests of those investors must be held para- of thought, I will be glad to yield for a formation they have when they decide mount. I look forward to continuing to work with you on safe harbor and other issues re- question. whether or not to invest or not to in- lated to securities litigation reform. We are trying here to get this infor- vest. Thank you for your consideration. mation out. As the Council of Institu- So the safe harbor is a critical issue Sincerely, tional Investors, representing literally in soliciting that kind of information. ARTHUR LEVITT. millions of small investors in this That is why it is so important. I think Mr. DODD. Mr. President, if you dis- country with hundreds of billions of their testimony before the SEC on agree with safe harbor, and wish to dollars in assets, said in testifying be- truly a safe harbor, a 100 percent safe apply a standard here that is appealing fore the SEC, the safe harbor must be harbor is absolutely critical. Again in on its face, but actually undercuts the 100 percent safe. the context of what we are talking very intention of the safe harbor, then Let me go back at that point quick- about, those that are excluded, from it seems to me you run the risk of de- ly. There is a fear that Members will the protections of safe harbor. stroying a very important vehicle that think that anything that anybody does Now, returning to my earlier exam- causes businesses to voluntarily give in relationship to securities can fall ple, I illustrate the problem with the information out that is critical. Infor- into this safe harbor category. That is amendment of my colleague from mation, as I say, that could be positive not the case at all. Maryland. The CEO in the fact situa- or negative information. So that is the As pointed out by the distinguished tion I described does not think it will reason it exists. junior Senator from Utah today, by the work out as well as it is, and goes to June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9139 the general counsel and says, ‘‘should I should have had a forward-looking SEC requirement they are required to share this information?’’ statement that said some have said we provide some forward-looking informa- It turns out the disk drive prediction have a problem; others say we do not tion. that he had made was a panic decision; have a problem. Would that not be an Is that correct? that, in fact, the disk drive turns out honest statement to the potential in- Mr. DODD. The Senator is correct. I to be fine, turns out not to be as bad as vestors? stand corrected. he thought. But many shareholders, Mr. DODD. Let me say to my col- My point here is that soliciting all based on the earlier prediction, sold league, another aspect of this bill, here the necessary information one would their stock. Now they sue them for ac- in the safe harbor context, in the safe like to have is not required by law. tually knowing that the disk drive was harbor context, it is our common de- Some statements are. The point I was really OK. sire to solicit information from these trying to make was in the case of the Of course when he gets before a jury businesses that do not have to make it one that I ascribed to. But the condi- he will be able to make his case. But forthcoming. I think, frankly, going to tion of a particular product line, a case the problem is, Mr. President, before the intent and purpose, to disregard in- could be made that that information you get to the jury, you are probably tent and purpose of that CEO, and have would not necessarily be required to be going to end up with a settlement in- the mere standard actual knowledge, I forthcoming. So my point is that while the temp- volving millions of dollars, because think, creates a nightmare. That is my tation to adopt the actual knowledge there were memos or other information view. that came across his desk that said, Mr. SARBANES. Is it the Senator’s standard here, in effect we may be undoing the very purpose that I pre- ‘‘Mr. CEO, we think this disk drive will view—will the Senator yield for a ques- sume is unanimous here. Maybe there be OK.’’ During the discovery period, as tion? are some who disagree with us, but you a practical matter in litigation, every Mr. MCCAIN. Regular order. If the want a good safe harbor. The purpose single paper that crossed that CEO’s Senator asked for the Senator to yield of having a safe harbor is that it be desk is going to be subject to discov- for a question, fine. safe. If it just be a harbor that is some- ery. The PRESIDING OFFICER (Mr. times safe or never safe or rarely safe, So there on the table is a memo or GRAMS). The Chair reminds the Sen- then the very purpose for its existence two or three that says, ‘‘We think this ator—— is undermined. As a result, you defeat disk drive is not as bad as you think,’’ Mr. DODD. I am happy to yield to my the very purpose of creating it. but he felt based on his feelings about colleague. My point here is that a simple stand- this, with the advice of general counsel Mr. SARBANES. I just asked the ard of actual knowledge can undermine Senator if he would yield for a ques- that he said ‘‘I don’t think it will do that very desire that I believe is unani- that well.’’ tion. mously held in this body to create that Now you have yourself with actual The PRESIDING OFFICER. A re- safe harbor. So while the standard of knowledge—not with intent, not with minder that the Senator must address actual knowledge is a difficult stand- purpose, to mislead, but with actual the Chair to ask a question. ard to overcome rhetorically in the knowledge of information—that sug- Mr. SARBANES. Mr. President, I ask subject of debate, in the practical ap- gested a different result than what the the Senator if he will yield. plication of it, then I think it is a CEO predicted when he put out a state- Mr. DODD. I am happy to yield to my standard that undermines the very pur- ment that he thought the pension colleague. pose of safe harbor. funds ought to know about. Mr. SARBANES. Is it the Senator’s I say to my colleague from Maryland I do not believe that it is in our in- view that all forward-looking state- and others, they know I have some dif- terest in the safe harbor context—not ments are voluntary? As I understand ficulty even with this standard. I am in other issues of aiding and abetting it, the Senator says you are going to worried about having a good one that and joint and several and proportional dissuade forward-looking statements does create the safe harbor, and that liability, but in safe harbor context, if because these are voluntary things; does apply to those efforts. My col- it is a standard of actual knowledge of and, if they have a problem with what league from New York and I and Sen- something that existed that contra- the standard is, they will not volunteer ator DOMENICI have discussed this at dicted your own statement, thereby the information. some length. And there are many dif- you said something misleading, be- Is that your position? ferent ways we may finally get some cause there was information that Mr. DODD. That is the difficulty language here that can be appropriate. reached a different conclusion, and you here. Yes. But establishing just actual knowledge end up with a lawyer saying ‘‘Look, Mr. SARBANES. What is your expla- with no intent or no purpose to mis- you know, I don’t know how a jury will nation of the language on page 113 of lead, it seems to me, runs the risk of find with this.’’ The Sarbanes language the bill which includes within the defi- having the very purpose of the safe in this bill says ‘‘actual knowledge.’’ nition of a forward-looking statement harbor destroyed. Mr. SARBANES. Actual knowledge in paragraph 3, lines 18 through 22, a I cite the factual kind of example in- that it was false. Why should anyone statement of future economic perform- volving a good meaning, well intended be able to make a statement that they ance contained in the discussion and person—let us assume that most of the have actual knowledge that is false. analysis of financial condition by the people we are talking about here are Mr. DODD. Misleading. That could be management, or in the results of oper- not inherent crooks. We are talking the subject of litigation here. You ations included pursuant to the rules about decent, competent people who made a statement that you said you and regulations of the Commission. want to do their business appropriately thought this disk drive was going to do Mr. DODD. I do not understand the and properly. And sharing information poorly. You had information before you purpose of the statement. that can then undermine them and end that said something else. I sold my Mr. SARBANES. It is my understand- up with significant litigation costs is stock on the basis of that prediction ing that currently under the rules and not exactly serving the purpose of the you put out, that it was not going to do regulations of the Commission you are intent when we desire to put in a safe well. required to provide certain information harbor in the legislation. Now I know you had information that is in effect a forward-looking The SEC itself, as I said earlier, feels from your people in your divisions that statement. as though the safe harbor needs to be said it would do fine. You made a pre- Does the Senator agree to that? strengthened. Their present standard is diction it would do poorly. You had ac- Mr. DODD. I understand that. How ‘‘acted in good faith and reasonable tual knowledge there was different in- much information you have to—— basis for believing what you are say- formation available to you. You cannot Mr. SARBANES. But you earlier ing.’’ That, of course, created a moun- tell me about that. As a result, I am made the statement in effect that this tain of problems over the issue of rea- suing you, and I think I can collect. was all voluntary, and that people, if sonable basis. Mr. SARBANES. Do you think he they were dissuaded, would provide no But as I mentioned a moment ago, we should have told? Do you think he information. The fact is under current have added language here that requires S 9140 CONGRESSIONAL RECORD — SENATE June 27, 1995 cautionary language. The Senator from ator from New Jersey, and that as I do sell at among the highest price-earn- New York has pointed out that we ex- so, I have been in these similar situa- ings ratios of all listed securities on tended to the SEC the authority to go tions with very tough calls from the any exchange. after these matters which may be the Chair as to who speaks first. I believe There used to be a company in the in- best way of recovering, I would say the rule of the Senate is who is on vestment business, an old name in the anyway, because they are not nec- their feet and speaks first is who seeks financial world, Kidder-Peabody. And essarily out to just win for themselves recognition. I believe we were both on each month they would publish a list but rather win for the investors where our feet. I do not believe that the rule known as The Nifty 50. These were the they have the knowingly intentionally of the Senate is who has been standing highest price-earnings ratio companies and with purpose attempted to mislead the longest. that were listed. They did that for over the investor. That may not be a perfect With that, I ask unanimous consent 265 months, for more than 22 years. standard but I think our desire here to that the Senator from New Jersey is to Every month they would publish lists have a higher standard makes sense if be recognized for 15 minutes, and then of the companies that were among the you understand the value of safe har- I would be recognized for my remarks. investors’ favorites. The company that bor. The PRESIDING OFFICER. Without led that list was my company, ADP. It Again I will state what I said at the objection, it is so ordered. was on the list 215 out of 265 months, outset. For those who do not believe in Mr. LAUTENBERG. The Senator far more than the next best company safe harbor, adoption of the Sarbanes from Arizona is very courteous. which listed among the top list more amendment makes sense because in my The PRESIDING OFFICER. The Sen- than 200 times. Obviously, the company view that undermines the safe harbor. ator from New Jersey. did well. It performed well year after So I would respectfully disagree with Mr. LAUTENBERG. I respect and ap- year. But it was the investors’ belief, my colleague in his amendment, as ap- preciate it. the investors’ confidence, that they pealing as it is to the rhetorical sense. How long does he intend to speak? could always count on ADP to tell the I think the net effect of it at the end of Mr. McCAIN. About 10 minutes. truth about what was happening that the day is that we are going to abandon Please go ahead. The Senator was on caused the stock price to swell as the the safe harbor protection. Information the floor. Please go ahead. earnings grew. will not be forthcoming that could oth- Mr. LAUTENBERG. I thank the Sen- As I look back at that period, I know erwise help your institutional inves- ator from Arizona. that I was in the forefront of CEO’s tors, particularly in terms of deciding Mr. President, I ask unanimous con- who provided investors with forward- whether or not to buy or sell the stock sent to be added as a cosponsor of the looking statements on my company’s in a particular company. Sarbanes amendment. financial health. It made sense to me I think that is a shortcoming, if we The PRESIDING OFFICER. Without then. It makes sense to me now. adopt this language as part of this bill. objection, it is so ordered. One of the things that I know this I think it will hurt what we have tried Mr. LAUTENBERG. Mr. President, as bill would like to accomplish is to to do here with this legislation in try- the Senator from Maryland explained, make sure that the public is as well in- ing to strike the balance. this amendment would modify a provi- formed as possible. It is not simply to With that, Mr. President, I yield the sion of S. 240 that I find very troubling. focus on whether or not litigation is floor. I know that earlier today our colleague possible or whether there ought to be Several Senators addressed the from New York tempered somewhat ceilings on certain claims but, rather, Chair. the existing language relating to the to give the public a chance to know The PRESIDING OFFICER. The Sen- safe harbor provision, but Mr. Presi- what is going on and at the same time ator from Arizona. dent, I do not think he went far not to encourage frivolous or whim- Mr. LAUTENBERG. Mr. President, enough. sical lawsuits. the Chair has an obligation to recog- One goal of this bill is to minimize It is important that investors have as nize the Senator who stood up first. the existing disincentives to provide much information as they can. Every- Mr. McCAIN. Mr. President, last Sep- detailed forward-looking statements one knows, especially in the larger tember the United States—— about the economic prospects of their companies, that senior executives in Mr. LAUTENBERG addressed the companies. the company know very well what they Chair. Everyone agrees that is a desirable are expecting to happen over a year, 2, The PRESIDING OFFICER. The Sen- goal. 3, 4, 5 years in advance. It may not be ate is out of order. The Senate will be I certainly do. precise, but they have a target; they in order. Both Senators were standing. Indeed, my support is based on per- have a goal. Everyone knows that in The Senator from Arizona has been sonal experience. addition to the executives within the standing. Prior to coming to the Senate, I company, the board of directors has to Mr. LAUTENBERG. I have been worked in the private sector. I be notified if there are any changes. standing. With all due respect, I have cofounded a company with two others, What does that represent? It rep- been here, was here before the Senator three of us from poor working-class resents an advantage that people on from Arizona, and I called for recogni- homes, that today employs over 20,000 the inside have over those on the out- tion from the Chair. And the Chair, as people. It is an American success story. side who are investing their money. I saw it, deliberately chose to ignore I say that because I think it is impor- And there is nothing, no reason at all my appeal for recognition. The Chair I tant to occasionally call on one’s back- why anyone on the inside ought to guess has that right. But that is not ground as we review some of the legis- have privileged information with which the way this body is to operate. lation that is proposed in front of us. to sell stock or buy stock ahead of the The PRESIDING OFFICER. The Sen- After the company went public in 1961, investing public. It is critical that all ator from Arizona has the floor. I filed countless statements with the investors have as much information Mr. McCAIN. Mr. President, my SEC as its CEO. As the CEO, I believed about the company as they can to friend from New Jersey is obviously that it was important for investors to make informed investment decisions. upset. Could I ask how long the Sen- have as much information as possible. Despite the desire to provide infor- ator from New Jersey intended to Each year, I made it a practice to mation, many issuers, many companies speak? project earnings for the following year. do not provide sufficient information. Mr. LAUTENBERG. Probably 15 min- And if it needed modification during They do not because they are con- utes. I am not upset at the Senator the period due to changes and condi- cerned about their potential liability, from Arizona. I am upset because of tions, I quickly went to the public to which this bill addresses, should these common courtesy. alert them to any revision. This proc- forecasts turn out to be off the mark. Mr. McCAIN. I understand. May I say ess had significant rewards because in- Well, if things change, as I said in my that I believe it is a very close call. vestor confidence in ADP—my com- comments, then what ought to happen And, Mr. President, I ask unanimous pany—caused our stock, which is listed is the company ought to say: Investors, consent to yield 15 minutes to the Sen- on the New York Stock Exchange, to be prepared. We have to take a hit on June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9141 our earnings because of this product or from liability. You have to pay the have the honor of serving the institute this market or what have you, but we price for the deception. as chairman of its board of directors. I have confidence in the future and this Now, I understand why the Senator am proud of IRI’s work generally, and is what we expect. The investors will from New York would want to expand its work in Haiti specifically. I will stay with the ship. This is especially the current safe harbor. Everyone talk some more about the quality of true for the small high-tech companies, wants that, including the SEC. But I that work a little later in my remarks. which is what my company was. These think this bill has gone too far in the I want to first talk briefly about the are companies whose growth we want other direction. We should not be en- elections and the gross irregularities to encourage. It is not in the public in- couraging or protecting fraudulent that indeed make it impossible to ver- terest for these companies to go out of statements, which I believe is what S. ify the results. It is important to note business because of a lawsuit based on 240 might inadvertently do. that no observer of the election—be it a financial forecast or information Mr. President, we have the most effi- OAS observers, or observers on the which despite the company’s best ef- cient markets in the world, and this is White House delegation, or even one forts later turns out to be inaccurate. due in large part to the reliability of very candid Government minister in And that can happen despite the best information available to investors. I do Haiti, will dispute the evidence of intentions of the company. not understand why we would want to irregularities which IRI’s observers and I remember how much the stock of enact legislation that might jeopardize these other monitors uncovered. IRI biotech companies dropped when we this. observers found that these elections were discussing health care last year. Once again, I thank my colleague were, in a word, chaotic. And should those biotech companies be from Arizona for yielding the floor. The headline for today’s Washington held accountable for this drop? Of I urge my colleagues to support this Post story on the elections was ‘‘Una- course not. We want to protect the re- amendment, and now I yield the floor. nimity in Haiti: Elections Were Cha- search and the innovation that devel- Mr. MCCAIN addressed the Chair. otic.’’ Unfortunately, no one seems to ops from such firms. But I believe that The PRESIDING OFFICER. The Sen- have told the Washington Post’s edi- this bill goes too far in the effort to do ator from Arizona. torial writers. Or, possibly, those writ- Mr. MCCAIN. Mr. President, I thank that. ers do not believe that the chaos my friend from New Jersey. I say to which, in truth, defined these elections The recently amended language in S. him I understand the sensitivity of rec- 240 provides a safe harbor from liability seriously undermined their integrity. If ognition. I remained in the minority that is the judgement of the Washing- unless the issuer’s statement is know- party for some 12 years, and I appre- ingly made with the purpose and actual ton Post’s editors it is a faulty one, ciate the sensitivity involved with and it cannot withstand the weight of intent of misleading investors, and on that. I believe that in all fairness the its face that legislative language looks the abundant evidence that the elec- Chair is required to recognize the per- tion process—from the campaign sea- reasonable. But the committee report son that the Chair hears first, and I as notes that purpose and actual intent son through election day to the ballot always appreciate his courtesy. counting—was plagued by very grave are separate elements that must be Mr. President, I rise in support of the proven by the investor. problems. amendment. People can judge for themselves To me, this standard, although an f whether these problems have rendered improvement over the version reported the elections completely unfair and out of the Banking Committee, is still HAITI’S ELECTION unfree. The IRI delegation’s respon- too high a threshold. This amendment Mr. MCCAIN. Mr. President, last Sep- sibility as impartial observers was to provides safe harbor protections for is- tember, the United States sent 20,000 of simply call them as they saw them. suers who make forecasts, but we nar- its sons and daughters to Haiti. Their What they saw was rather discourag- row this protection so that issuers who ostensible mission was defined in the ing, so discouraging that even make statements with the knowledge name given to this unopposed invasion Aristide’s Minister for Culture, Jean- that the information was false or mis- of another country—Operation Uphold Claude Bajeux, offered an apology. ‘‘As leading would be liable. That is a rea- Democracy. Today, we are told by a member of the Government,’’ he said, sonable standard, and it is a standard some Haitian Government Ministers, ‘‘I am not proud of this.’’ Minister supported by the SEC and by the ad- by the head of Haiti’s Provisional Elec- Bajeux went on to observe that ‘‘in- ministration. It protects those who toral Council, and even by our own stead of improving on the 1990 elec- should be protected. And it does so Washington Post, that democracy—a tions, we have done worse.’’ without creating a safe harbor for form of government that we exported Not surprisingly, the widespread those who should be subject to litiga- to Haiti at the risk of American lives— irregularities have prompted opposi- tion. may be, in the end, too much to expect tion parties to reject these elections as It may seem to those listening or from this poor, troubled, violent coun- fraudulent. That charge was leveled by who may be watching this debate that try. the mayor of Port-au-Prince, Evans the Senator from Maryland and I are Few would disagree that what hap- Paul, as well. You will recall, Mr. splitting hairs with single word pened last Sunday at least raised ques- President, that Mayor Paul’s post sup- changes. However, when the next finan- tions, serious questions, about whether port for President Aristide was often cial scandal rocks our markets and in- Haiti’s elections were free and fair. referred to by President Aristide’s sup- vestors are prevented from recovering But, as I just noted, among the few, porters in the United States. their losses caused by intentionally were some Aristide ministers; Mr. Mr. President, let me offer a brief misleading forecasts because they are Remy, the hopelessly incompetent sampling of the irregularities which unable to demonstrate actual intent, chairman of Haiti’s election council; the IRI delegation documented. I will those affected investors will certainly and, again, the Washington Post. In first read from the executive summary feel the difference. We do not want to truth, the gross irregularities that of IRI’s pre-election report which eval- hurt those investors who are able to plagued last Sunday’s election, and the uated the pre-electoral process and en- demonstrate that an issuer inten- polling that occurred on Monday pur- vironment for their comparison to tionally made a misleading statement portedly to compensate for a small minimal standards of acceptability. but are unable to show actual intent. fraction of those irregularities, as well The elections were originally to be I cannot understand this. I say that as the mounting evidence of vote held in December, but were postponed again as a person who has been on both counting fraud have made it, in the several times for a variety of reasons. sides of the matter—as an investor and sensible judgment of Representative Mr. President, I ask unanimous con- as an issuer. I believe that the amend- PORTER GOSS—‘‘impossible to verify sent that the complete executive sum- ment as proposed provides the right the results of this election.’’ mary be printed in the RECORD. balance. If you make a forward-looking Mr. GOSS led an accredited election There being no objection, the mate- statement knowing it was false or mis- observation team from the Inter- rial was ordered to be printed in the leading, you should not be immune national Republican Institute [IRI]. I RECORD, as follows: S 9142 CONGRESSIONAL RECORD — SENATE June 27, 1995 EXECUTIVE SUMMARY for and who is running. There has been no witnessed. For calling the press’ atten- ELECTORAL PROCESS civic education campaign, with the excep- tion to these problems, the IRI mission The legal foundation for these elections tion of some limited U.S. and U.N. military was chastised today in a Washington was a Presidential decree that subverted the efforts, to illuminate the purpose of this Post editorial for unconstructive polit- legislative process. election. Similarly, there has been no educational ical science correctness. The formulation of the Provisional Elec- In response to that charge let me just toral Council (CEP) itself breached an agree- campaign on how to vote, which for a largely ment between the President of the Republic illiterate population in Haiti could pose seri- quote the last two paragraphs of Mr. and the political parties to allow the parties ous difficulties on election day. GOSS’ statement yesterday as chair- Compared to other ‘‘transition elections’’ to nominate all candidates from which CEP man of our delegation. observed by IRI, such as in Russia in 1993, El members would be chosen by the three It was important for Haiti and the inter- Salvador in 1994, South Africa in 1994 and branches of government. Only two of the national community to hold this election, even China’s Jilan Province village elections nine CEP members were chosen from the but holding an election is simply not enough. in 1994, the pre-electoral process and envi- parties’ list. The purpose of this election was to create ronment in Haiti has seriously challenged The voter registration process, to have layers of government that can serve as the most minimally accepted standards for been administered by the CEP, was com- checks and balances on each other and de- the holding of a credible election. plicated by miscalculations of population centralize power as envisioned by the 1987 size, lack of sufficient materials and reg- Mr. MCCAIN. Those are the problems Constitution. That is why it was important istration sites, and one million missing voter that undermined the integrity of the to have an inclusive process, not one marked registration cards. election before election day. We have by exclusion. The CEP review of the over 11,000 can- all read newspaper accounts over the It has been IRI’s intent throughout this didate dossiers for eligibility was a pro- last 2 days which chronicled the abuses process to be thorough, independent, objec- tracted process that occurred under a cloak tive and constructive. In this regard, IRI will of secrecy. When the CEP made its decisions and irregularities that occurred on Sunday. Mr. Goss accurately reported maintain a presence in Haiti through the known, by radio, no reasons were given for final round of elections and will make rec- the thousands of candidates rejected. After in a press statement yesterday the fol- ommendations for the formation of the per- vehement protests by the parties, some rea- lowing serious problems. manent electoral council. sons were supplied and supplemental lists While the international military This is hardly inflammatory lan- were announced through June 14, thirty-one served well as a deterrent to wide- guage, Mr. President. In fact, I think days after the date the final candidate list spread violence, the elections were not most people would consider it as well was to be announced. This stripped the CEP free of violence and intimidation. Vio- as all of IRI’s reporting to be construc- of its credibility with the political parties. lent incidents closed local polling sta- There is still not a final list of approved can- tive, informed criticism. Indeed, Brian tions in Port-au-Prince, Limbe, Port de didates available. Atwood, Director of U.S.A.I.D. and Paix, Don Don, Ferrier, Jean Rabel, The sliding scale of registration fees im- head of the Clinton administration’s Carrefour, and Cite Soleil. posed by the CEP—whereby political parties observation delegation in Haiti, said with fewer CEP approved candidates pay The election council failed to deliver larger fees—has made it difficult for many and distribute voter materials to a about IRI’s reporting: ‘‘they have per- parties to compete. As of June 20, five days number of polling stations. This re- formed a service.’’ before the election, protests against this un- sulted in countless delayed voting The Post’s editors are being a little usual requirement have gone unanswered. place openings and postponed the elec- disingenuous, I fear, when they raise The ability of the CEP and those under its the obviously bogus charge of political direction to administer an election is un- tions in some places. Unsurprisingly, these delays and postponements caused correctness. After all, that is not a clear. As of June 20, five days prior to the problem that the Post usually finds election, formal instructions for the proce- widespread voter frustration which dures of election day and the count had yet helps explain why turnout was low. distressing. to be issued; this has prevented the 45,000 There was also widespread disregard What the Post is really saying, as are persons needed to administer election day for the secrecy of the ballot. Many vot- those hysterical critics of IRI’s delega- from receiving specific training. ers had little choice but to mark their tion in the Aristide Government and on As of June 20, those persons designated by ballots in the open. the Provisional Electoral Council; the political parties as pollwatchers had not What they are really saying is that yet received any training from the CEP The thoroughly arbitrary process of qualifying candidates led to serious Haiti should not be expected to adhere which could lead to serious confusion on to minimally acceptable election proc- election day. consequences which we anticipated in These actions have led to deep misgivings our pre-election survey. The disquali- ess standards. across the Haitian political spectrum about fication of some candidates proved to IRI has observed elections in 48 coun- the ability of the CEP to fulfill the mandate destabilize the electoral environment tries. Some of those countries and and functions normally executed by election in certain areas, this was most acutely some of those elections were the sub- commissions. Political parties had no idea to the case in Saint Marc and Jean Rabel. ject of disagreements, sometimes, but whom to turn with complaints in the proc- The New York Times reports that at not always, partisan disagreements in ess—the CEP, the President of the Republic, the U.S. Congress. Elections in Chile, the United Nations Electoral Assistance least 200,000 voters are still waiting to Unit or the United States Government. cast their ballots, but election officials Nicaragua, El Salvador, Russia come to Three political parties withdrew from the still won’t say when and if they will be mind. Never, not once, has there been process as a form of protest. allowed to do so. the slightest intimation that IRI dele- ELECTORAL ENVIRONMENT Regarding the vote tally, I will quote gations were anything other than ob- A concern for security is an issue that has not from IRI’s report but from the Or- jective, scrupulously fair, committed, permeated every step of the process. The as- ganization of American States which hard working professionals. On the sassination of Mireille Durocher Bertin, a had a much larger observation team in contrary, IRI delegations are routinely well-known lawyer and leading political op- Haiti. Because of administrative acclaimed for their thorough profes- ponent of Aristide, only conformed the fears failings in the election it remains to be sionalism. of the parties and candidates. During the cri- seen how effectively the count will be But because IRI discovered and re- sis, many elected representatives feared re- carried out. ported information which, apparently, turning to their districts, contributing to the Washington Post editorial writers the decay of political infrastructure. Can- As anyone who read a newspaper didates have curtailed their campaign activi- today discovered, allegations of wide- would have preferred to have gone un- ties and has given personal security a higher spread abuse and irregularities in the noticed, the integrity of these observ- priority. counting process are coming in by the ers—not the election, but the observ- The campaign itself began late and has dozens. Again and again, we are hear- ers—is now called into question by been barely visible until some activities in ing from all observers that unmarked those editorialists and others. the last week prior to elections. Given the ballots are being marked at the re- What the Post editorial writers and process and environment surrounding these gional counting centers to indicate a others are really saying is that what- elections, it is doubtful many of Haiti’s rec- ognized political parties could have com- vote for Lavalas candidates. ever standards we hold El Salvador to; peted effectively. Mr. President, this is, as I said, only whatever standards we hold Nicaragua The electorate itself is basically unin- a brief sampling of the problems which to; whatever standards we hold Croatia formed about this election—what it stands IRI observers and all credible observers to; whatever standards we hold Serbia June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9143 to; whatever standards we hold Albania who has what I believe is a very distin- have made misleading statements or to; whatever standards we hold Bul- guished record, as well as a fine record false statements, and we are going to garia to; whatever standards we hold as a judge for this Nation. I have the specifically exclude them from the safe Azerbaijan to; whatever standards we utmost respect for Judge Mikva, and so harbor. Mr. President, I think that is hold Russia to; whatever standards to it is with seriousness that I view his responsible. I want to commend the which we hold all these countries letter that has been distributed. chairman of the committee for doing where IRI observed elections without It addresses the subject which we are that. I think it is a responsible ap- controversy, no matter how minimal discussing, and the implication is, of proach. I want to say on this floor that those standards are we cannot expect course, that this is an important factor if there are other areas that have had Haiti to meet them. in the President deciding whether he this kind of problem, we ought to pay Mr. President, that is what the Wash- will sign this bill. He speaks out attention and add them to this section. ington Post said today, and it is an in- strongly on behalf of Senator SAR- That is how to deal with this area. If justice. It is an injustice to IRI; to Mr. BANES’ amendment, I think for no there is a problem, we have to deal Porter Goss and all the good and hon- other reason than that it is worth tak- with it. What is left, which is consider- orable people on IRI’s election observa- ing a serious look at. ably reduced, is meant to give some tion delegation in Haiti. As I read the two standards, I suspect freedom of speech and is meant to Most importantly, Mr. President, it other Members will find it a challenge, allow people to make reasonable state- is an injustice to the people of Haiti. as I do, in pinpointing precisely what ments. the difference is. The bill carves out an They are human beings who yearn for The problem here is that any time freedom like any other nation, and who exclusion; that is, a safe harbor. What we found under current law is that peo- you attempt to forecast earnings, any are capable of building and sustaining time you, again, attempt to forecast the institutions that will protect that ple in business, in order to avoid liabil- ity in terms of speculating about their what is going on, you are probably not freedom. To expect any less of Haiti is, going to have any better record of fore- as I said, an injustice. The people who company or commenting on their com- pany’s future, simply have clammed casting than the weather bureau has. have condescended to Haitians, includ- They are conscientious, honest, and ing the Post editorialists, by asking up. Their lawyers tell them, ‘‘Look, if you say anything and it turns out not they miss it about half of the time. It the world’s indulgence of their elec- does not mean that they are evil. What tion’s failings, should apologize to the to be totally accurate or if you specu- late on the future and it goes the other it means is that it is difficult to fore- Haitian people, and to those good cast. The question we have to answer Americans who they have maligned in way, you are going to get sued.’’ So to avoid being sued they say, ‘‘We don’t is, should we simply, by putting tough the process. penalties into place, prevent people Mr. President, I yield the floor. want you to say anything.’’ Literally, that is what many companies will say. from economic forecasting. Maybe we f ‘‘How is the weather at your plant?’’ ought to put into law that it is illegal PRIVATE SECURITIES LITIGATION ‘‘Can’t say.’’ for anybody to come in about the fu- REFORM ACT ‘‘What do you expect your earnings ture of their company. The reason we to be?’’ do not is that it probably does not help The Senate continued with the con- ‘‘I don’t know.’’ investors very much. sideration of the bill. What this issue revolves around is Mr. D’AMATO addressed the Chair. the fact that we have denied economic Mrs. BOXER. Will the Senator yield? The PRESIDING OFFICER. The Sen- free speech. It is a different issue than Mr. BROWN. I will yield when I fin- ator from New York. misleading people. I think everyone ish my statement. This is an attempt. AMENDMENT NO. 1478 here—at least I hope they would— One says, ‘‘knowingly made with a pur- Mr. D’AMATO. Mr. President, I would feel very strongly that if some- pose and actual intent of misleading would like to inquire of my colleagues one intentionally misleads you for investors.’’ The amendment says, if any of them have any statements to their own gain that we give redress for ‘‘made with the actual knowledge that make with respect to the pending that. We expect people to be honest and it was false or misleading.’’ amendment, and how much time they that is fair and reasonable. But what Well, ‘‘knowingly made’’ and ‘‘actual intend to take. Might I ask my col- we have found is the penalties are so knowledge’’ sound similar and have league how long he believes he will profound and enormous and the ease of some similarities. I believe, in reading take? bringing a suit is so great that we have the legislation, the big difference is Mr. BROWN. I have a brief statement tried to address the problem by at least this: It is in the words of ‘‘purpose’’ that I think will be more than com- not penalizing people who make rea- and ‘‘actual intent.’’ I think as Mem- pleted in 5 minutes. sonable statements about the future of bers try and make a decision about Mr. D’AMATO. Mr. President, I ask their company. That is what this is all how they can vote, they ought to ask unanimous consent that after the Sen- about. themselves, if somebody makes a state- ator from Colorado makes his state- The first thing the bill does is go ment and it turns out not to be accu- ment that I be recognized—it is my in- through a series of instances where rate, should we insist, before we penal- tent to make a motion to table. Does some people have been known to make ize them, that they had the purpose the Senator wish to claim time to re- misstatements about a company in the and actual intent of misleading some- spond? past, and they specifically exclude one? Or was it an innocent statement Mr. SARBANES. I may. I do not them from this safe harbor. In other and they did not intend to mislead know what he is going to say. Why do words, they say, Look, if you are con- someone, they did not have that actual we not say 10 minutes evenly divided victed of any felony or misdemeanor, intent? I believe the purpose of mis- and go to the vote? you are not going to come under this Mr. D’AMATO. That is fine. I ask provision at least for a few years. If leading someone and intent of mislead- unanimous consent that after the you are offering securities by a blank ing someone is at the heart of this statement of the Senator from Colo- check company, you’re not going to amendment. rado, which will take 10 minutes equal- come under this safe harbor provision. The amendment is offered by a very ly divided, at that point in time I will If you are involved in issuance of penny conscientious, thoughtful legislator. It ask for the yeas and nays and make a stocks, you are not going to come is endorsed by a very thoughtful and motion to table. under this safe harbor provision. If you reasonable judge, who acts as counsel The PRESIDING OFFICER. Without are dealing with a rollup transaction, to the President. I think the heart of objection, it is so ordered. you will not come under the safe har- the issue comes down to whether or not The Senator from Colorado. bor provision. If you are dealing with a we want to extend economic free Mr. BROWN. Mr. President, distrib- going private transaction, you will not speech in these areas. Should you have uted on our desk is a statement from come under the safe harbor provision. the purpose and intent of misleading Abner Mikva, counsel to the President The bill has said here are some areas, people, or should you be allowed to say and former Member of this Congress, and we understand in the past people what is appropriate without that? S 9144 CONGRESSIONAL RECORD — SENATE June 27, 1995 Mr. President, I want to pledge one and the efficiency of the capital markets— statement was false—even though he thing. I think the issue raised is appro- the two goals of the Federal securities law. had actual knowledge. priate and is a good one. I pledge one He has said about the language that Mr. D’AMATO. Mr. President, I have thing. If there are additional carved- is in the bill, the language we are try- heard many statements in this debate. out areas, exemptions from this that ing to take out: One particular statement I have heard we ought to look at, I want to look at I cannot embrace proposals which allow is about a pirate’s cove. The pirate’s them and support them if they are rea- willful fraud to receive the benefit of safe cove exists today, those pirates are sonable. But let me say, Mr. President, harbor protection. taking investors for a real ride, and that I think it is important that we be That is what the issue is. The Gov- they are drowning them. They are very careful about denying economic ernment Finance Officers Association drowning companies and they are free speech. It is an important aspect has written to us that the safe harbor drowning good people. of giving a full picture in describing provision in the bill opens a major All the pirates have to do is allege economic opportunities and economic loophole through which wrongdoers fraud, and companies find themselves endeavors. could escape liability while fraud vic- facing millions of dollars in damages or Mr. D’AMATO. Mr. President, I be- tims would be denied recovery. That is in settlements. If we adopt the stand- lieve that under the present order we the issue. ard in this amendment, nobody will be have 10 minutes equally divided. I understand that we need a meaning- willing to make predictions. They will The PRESIDING OFFICER. The Sen- ful safe harbor, but the safe harbor not take the risk. ator is correct. should not be structured in such a way Now, look at what S. 240 says. It Mr. D’AMATO. Mr. President, we that pirates can find shelter in it. And, says, with no exceptions, that the safe have debated this issue for several days as written, the language in the legisla- harbor does not apply to a forward and I think the Senator from Colorado tion does exactly that. That is why the statement that is knowingly made stated the concern with this amend- Chairman of the Securities and Ex- with the purpose and actual intent of ment well. If there are areas where we change Commission, the Government misleading investors. need additional carve-outs—to exempt Finance Officers Association, the We think that this standard will en- people from getting this safe harbor, I North American Securities Adminis- courage people to make statements, am willing to look at them. Senator trators Association, which represents make predictions, but will hold them DODD is willing to look at them. Sen- the 50 States’ security regulators, that liable if they knowingly, with intent to ator DOMENICI is willing to look at is why—the North American Security defraud make a statement that is false. them. If there are reasonable sugges- Administration Association called the Anything less than this standard will tions that the SEC has, we will look at provisions in the bill ‘‘An overly broad allow the same band of pirates that we them. We are going to go to conference safe harbor making it extremely dif- have now to continue to bring if we pass this bill, and I pledge that we ficult to sue when misleading informa- meritless cases. will keep the offer open to look at tion causes investors to suffer losses.’’ S. 240 stops lawyers from being able those suggestions. We have been look- The amendment is very simple. The to pay their professional plaintiffs. ing for them for 3 years. If suggestions amendment would take out the lan- They were actually paying people come up now, because of this legisla- guage in which all of the regulators $10,000, $15,000, $20,000 to use their name tion, and they make sense, I will cer- have seen major problems, in terms of on the suit. One of these characters has tainly consider them. We have worked investor fraud, and substitute for it signed up 14 times with the same law to modify and strengthen, S. 240, to that you do not have protection in a firm, the same law firm that is work- protect the rights of the legitimate in- safe harbor if you make a forward- ing, lobbying, paying millions of dol- vestor and understand their concerns. looking statement made with the ac- lars to try and defeat comprehensive That is what we attempted to do in tual knowledge that it was false or reform. drafting this legislation. misleading. And no one yet on the floor If we want reform and to we want to I yield the floor. has explained to me why such state- get rid of these pirates, we need to pass Mr. SARBANES. Mr. President, I just ments ought to get protection from li- S. 240. This amendment will cause a want to make a couple of comments ability. chilling effect on the ability of people here at the close of the debate on this Mrs. BOXER. Will the Senator yield? to make projections about the future. amendment. I have to say to my col- Mr. SARBANES. I yield to the Sen- I yield the floor. ator from California. leagues, I hope everyone understands Mr. D’AMATO. Mr. President, I move Mrs. BOXER. Mr. President, I think that they are ignoring the rec- to table the amendment and I ask for that this is the crux of the matter. And ommendations and judgment of the the yeas and nays. the ranking member is really the con- Chairman of the SEC, the State Securi- The PRESIDING OFFICER. Is there a science of the Senate on this whole ties Regulators, Government Finance sufficient second? matter. I want to ask a very direct Officers Association, and so forth. It There is a sufficient second. question. I am not an attorney, and my may well be that people feel so knowl- The yeas and nays have been ordered. learned friend is. edgeable and have such expertise in The PRESIDING OFFICER. The this area that that does not trouble If we vote for S. 240 without the Sen- ator’s amendment, is it the Senator’s question is on agreeing to the motion them. I have to tell you, it troubles me to table. and would trouble me wherever I found view that a company or an officer of a company, could make a false state- The yeas and nays have been ordered. myself on some issues. I would want to The clerk will call the roll. be very certain about ignoring those ment—tell a lie, put it that way—make a false statement, which is tell a lie, The bill clerk called the roll. opinions. Mr. LOTT. I announce that the Sen- Arthur Levitt said: that he had actual knowledge was a ator from Indiana [Mr. LUGAR] is nec- A carefully crafted safe harbor protection lie? In other words, I know I am wearing essarily absent. from meritless private lawsuits should en- The PRESIDING OFFICER (Mr. courage public companies to make addi- a yellow suit. If I said I am wearing a tional forward-looking disclosure that would blue suit, I am telling a lie. I have to DEWINE). Are there any other Senators benefit investors. know that this is yellow. Is my friend in the Chamber desiring to vote? That is what the Senator from Con- saying that unless we adopt his amend- The result was announced—yeas 50, necticut has been asserting. No one is ment we could have a business person nays 48, as follows: challenging that. He earlier said, ‘‘You make a false statement that he knew [Rollcall Vote No. 289 Leg.] are not going to have any safe harbor.’’ was false, and he could still benefit YEAS—50 Nobody is saying that. from the safe harbor in S. 240 and hide Abraham Chafee DeWine Arthur Levitt goes on to say: behind that? Ashcroft Coats Dodd Mr. SARBANES. He could find shel- Bennett Cochran Dole At the same time, it should not com- Brown Coverdell Domenici promise the integrity of such information ter within the safe harbor even though Burns Craig Faircloth which is vital to both investor protection he had actual knowledge that the Campbell D’Amato Ford June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9145 Frist Jeffords Reid were being substituted with newly jority of people in this country think Gorton Kassebaum Santorum marked ballots. While widespread vio- the President did the right thing. Gramm Kempthorne Simpson Grams Kyl Smith lence had been deterred, there has been Now, over the weekend, they had an Grassley Lieberman Snowe a lack of visible security, and closed election. It is a poor country with a Gregg Lott Stevens individual polls have forced Haitians to Hatch Mack tremendous level of illiteracy and stag- Thomas go home without casting their vote. gering economic problems. So it did Hatfield McConnell Thompson Helms Nickles Thurmond There have been long delays in the not look like a perfect election in this Hutchison Packwood Warner opening of polls in many areas and a country. But it is an effort of poor peo- Inhofe Pressler shortage of electoral material. Many ple to get out and freely choose its NAYS—48 ballot boxes were not sealed properly leadership, literally hundreds and hun- Akaka Feinstein Mikulski before being turned over to the re- dreds of candidates for local office and Baucus Glenn Moseley-Braun gional centers. Observers found a few national office in that country. And Biden Graham Moynihan Bingaman Harkin Murkowski cases of ballot stuffing. rather than castigate and denounce the Boxer Heflin Murray In short, we have a serious situation. effort for the shortcomings that cer- Bradley Hollings Nunn I conferred with the majority leader tainly were obvious and apparent, why Breaux Inouye Pell with regard to these events, and want Bryan Johnston Pryor are we not applauding the fact that Bumpers Kennedy Robb to announce to the Senate we will con- this country was trying to embrace de- Byrd Kerrey Rockefeller duct hearings on the week we return in mocracy and do so in a noble way? Cohen Kerry Roth the subcommittee of the Foreign Rela- Conrad Kohl Sarbanes Granted they had problems with bal- Daschle Lautenberg Shelby tions Committee, specifically the West- lot boxes and people abused the proc- Dorgan Leahy Simon ern Hemisphere Subcommittee. I want- ess. Votes were not counted. There Exon Levin Specter ed to make that known to the Senate. were shortcomings, to put it mildly, in Feingold McCain Wellstone Mr. President, I yield the floor. the process. All of that I accept. But ANSWERED ‘‘PRESENT’’—1 Mr. DODD. Mr. President, I ask unan- instead of picking this process apart, Bond imous consent that I may speak as if in there ought to be at least some under- NOT VOTING—1 morning business. lying statements that indicate that we Lugar The PRESIDING OFFICER. Without support this effort. We hope it is not objection, it is so ordered. just a one-time effort, but that in com- So the motion to lay on the table the ing months and years we will see de- amendment (No. 1478) was agreed to. f mocracy take hold in this poor, little Mr. D’AMATO. Mr. President, I move EVENTS IN HAITI country to our south. to reconsider the vote. Mr. DOMENICI. I move to lay that Mr. DODD. I was not in Haiti this And so I have been disappointed. It is motion on the table. past weekend as part of an observer just a continuum of almost the dis- The motion to lay on the table was group, but as I think most of my col- appointment people expressed over the agreed to. leagues know, I have been there on nu- last year over the President’s decision Mr. D’AMATO. Mr. President, I merous occasions. In fact, I lived on to go in and restore President Aristide, would propound a unanimous-consent the border of that country for 21⁄2 years which was a success. It seems to be a request which I believe will deal with and have a more than passing interest continuation of that. I am disappointed all of the outstanding amendments. I in the awareness of Haiti. by these remarks. This is working. It is believe there are six amendments, As I have listened this afternoon to not perfect. We have watched what three on each side, and it would be my several speeches now made about the happened in other countries, including intent to ask that we stack those votes events in Haiti over the past several what we are watching in the former So- so we could give our colleagues the op- days, I find it stunning in many ways. viet Union, the New Independent Re- portunity to arrange their evening My colleagues, by their remarks, al- publics. Countries that are struggling schedule. Possibly, with the concur- most imply that the situation in Haiti to find their democratic feet do not do rence of the two leaders, we can agree would have been preferable had there so instantaneously. It takes time. to time limits on all of those amend- not been an election or had there not So I commend President Aristide and ments, so we can take them up tomor- been the decision by the administra- commend the people of Haiti for the row morning and then proceed to final tion in previous months to go back to courageous attempt to have a free and passage. That is my intent, to see if we intercede, along with the support of fair election. I am terribly dis- can reach that agreement. I bring this the international community, to try to appointed it did not meet our high up because some of my colleagues have restore the democratically elected gov- standards of a perfect election. But asked what the schedule will be. If we ernment of that country. rather than spend our time denouncing can work out that agreement, it would This was not a perfect election in the imperfections, we ought to take a be my hope that we would dispose of all Haiti. There were serious problems. moment out and commend these peo- of the amendments this evening and But, remember, this is a country that ple. Some people walked literally miles then start voting at a certain time to- can count free elections on one hand— and miles to get to a polling place in morrow morning. fewer fingers in fact—that they have order to exercise their rights. Most of I yield the floor. had over the years. The last free one them are illiterate, cannot read or Mr. COVERDELL addressed the was 4 or 5 years ago when President write. They have to vote by looking at Chair. Aristide was elected. And then we colors or symbols on a ballot in order The PRESIDING OFFICER. The Sen- watched that election be ripped from to choose their party or candidates. ator from Georgia. the people of that country through a And to watch people get out with, I Mr. COVERDELL. Mr. President, I coup. think, the returns somewhere around rise to speak on the bill. President Clinton, the administra- 60 or 70 percent—in our elections in f tion, took the courageous decision to 1974 we had 38 percent that turned out restore President Aristide to power in to vote. DISTURBING EVENTS IN HAITI that country. And I recall back in So with all its imperfections, I think Mr. COVERDELL. I wish to comment those days during that debate the al- the people of Haiti deserve our ap- specifically on the remarks that were most apparent disappointment that plause, our commendation for their ef- made earlier by the Senate majority there was not more of a tragedy. We forts. And certainly the Government of leader and the Senator from Arizona did not lose a single soldier in that ef- Haiti does, as well, for conducting this with regard to the disturbing events we fort. In fact, the President deserves election. And albeit with its short- have witnessed in Haiti. great commendation, mind you, for the comings, my hope is in coming years Mr. President, we have received re- courage he showed in making an un- we will see better results and less im- ports that voting tally sheets were popular move. It was not popular at perfections in the process. But they do being intentionally altered and ballots the time. Today, interestingly, the ma- not deserve to be denounced, in my S 9146 CONGRESSIONAL RECORD — SENATE June 27, 1995 view, for the significant efforts they management; this is orchestrated to be overall fair, the election in El have made. chaos. Salvador to be fair, the election in Mr. President, I yield the floor. Mr. HARKIN. Would the Senator Nicaragua to be fair, the recent elec- Mr. MCCAIN addressed the Chair. yield for a question? tion in Chile to be fair. This is the first The PRESIDING OFFICER. Senator Mr. MCCAIN. I would be glad to. time they have judged this election not from Arizona. Mr. HARKIN. You mentioned—I do to be, that I know of, one which was Mr. MCCAIN. I listened with interest not know who IRI is. fair and open. But they certainly did to the statement just made by my Mr. McCAIN. The International Re- not judge the previous election to be in friend from Connecticut. And all I can publican Institute, which was there any way acceptable. They did not even say is it is deja vu all over again. I re- monitoring this election, as they have go to see it because everybody knew member the criticism that the Senator some 48 elections throughout the what that election was all about. from Connecticut leveled at the elec- world. I say to my friend from Iowa, Mr. HARKIN. I thank the Senator. tion in El Salvador that was attended there are certain standard procedures Mr. MCCAIN. I thank my friend. I al- by me and others. And, Mr. President, used in judging any election, whether ways appreciate this dialog with my he might have missed the thrust of my it be Russia, El Salvador, Haiti, any- friend from Connecticut. I think he remarks. And that is, that this elec- where else. These minimum standards may have misunderstood the point tion, according to the same group, the are what an election is judged by. when I made my statement. I also ad- IRI, that has observed some 48 elec- Mr. HARKIN. If I could ask another mire the tenacity, desire, the will of tions around the world, did not meet question. the Haitian people to obtain freedom. high standards. They did not meet min- It is the International Republican In- They are people who deserve, if any one imum standards, I say to the Senator stitute. I did not know that. group of people in this hemisphere de- from Connecticut. Second, in this institute, did they serves our assistance and help, and I applaud the effort of the people of monitor the elections that were held in they deserve a freely elected govern- Haiti for wanting to be involved in the Haiti about, if I am not mistaken, a lit- ment after all they have suffered electoral process. I applaud the efforts tle over 2 years ago when the junta, the through. that have been made by many people. military, was in charge and there was I am just saying to my friend from But the fact is, by objective judgment, an election there? Connecticut that there are certain this election was chaos—chaos. I am wondering whether they mon- standards that must be observed, that And, Mr. President, the report of our itored that election and if they drew must be adhered to in any election; observers—I will be brief because I any comparisons between this election otherwise, the people do not have that know the Senator from New York gets and that election. I only ask that ques- precious right, and that is to choose understandably impatient with this tion because—— their own leadership. issue impeding the progress of the Mr. MCCAIN. My answer is, as you It is not clear to me yet what all the pending legislation. But this is the re- know, that that election was so fraudu- reasons behind this failure were but, in port of the objective observers, these lent there was no international ob- my view, it has been a significant fail- same observation teams that, as I say, server groups allowed there. But in the ure. observed 48 other elections throughout words of other people who observed the I yield the floor. the world and judged by the same 1990 election, this was far worse than Mr. GRAHAM addressed the Chair. standards, not high standards, Mr. the 1990 election conducted in Haiti The PRESIDING OFFICER. The Sen- President, the same standards. Here’s which was observed by international ator from Florida. what they said: organizations. Mr. GRAHAM. Mr. President, it had General: Total breakdown in reception of Mr. HARKIN. May I ask one more been my intention at this point to offer ballots and tally sheets to counting centers; question? Does the Senator know how an amendment, but I ask unanimous total abandonment of materials; zero super- much money the United States or consent for time as in morning busi- vision of materials; counting of ballots oc- other nations may have provided and ness. curring without supervision. support that we may have provided in The PRESIDING OFFICER. Without Tally Sheets: Tally sheets being destroyed order to help that electoral process in objection, it is so ordered. deliberately; tally sheets have been created/ replaced; tally sheets with opposition parties Haiti, being a poor country? I just won- f leading have been destroyed in front of ob- der if there are any figures on how servers; tally sheets and other electoral much we did in terms of monitoring as- OBSERVATIONS ON ELECTIONS IN records are being thrown out as garbage— sistance to help them do the things HAITI and trash is being removed from site. that the Senator has pointed out were Mr. GRAHAM. Mr. President, I was Ballots: Ballots have been burned, both shortcomings in that election. in Haiti on Saturday and Sunday of used and unused; ballots have been sub- Mr. MCCAIN. I respond to my friend this weekend, and I would like to share stituted with newly marked ballots; unused from Iowa, I do not know the amount ballots by the hundreds of thousands are with my colleagues some of my obser- readily accessible at counting sites. of money. I do know what the commit- vations. I intend to submit a more for- ment on the part of the American Gov- Let me repeat that. Perhaps the Sen- mal statement later, but for this after- ernment was. But I know the election ator from Connecticut feels it is a real noon, I would like to talk about some should have met certain minimum high standard not to expect unused bal- of the things that I saw. standards. Otherwise, there is no sense Frankly, to my good friend from Ari- lots by the hundreds of thousands read- in holding an election. And the observ- zona, who was represented in Haiti, he ily available at counting sites. ers who came in to observe this elec- and the IRI, by another good friend, Unused ballots being mixed in with marked tion and others did not believe those Congressman PORTER GOSS of my State ballots; new ballots clearly being marked at counting sites; crumpled ballots, registra- standards were met. I mean, the front of Florida, I was concerned about my tion materials, and ballot boxes accumulat- page of the Washington Post this first experience in Haiti this weekend. ing in trash heaps, inside and outside count- morning, ‘‘chaos’’ and other descrip- I got off the plane Saturday morning at ing sites. tions along those lines clearly indicate approximately 11 o’clock, and at the Ballot Boxes: Ballot boxes universally un- that if we did spend money, and I am foot of the plane were several U.S. re- sealed; ballot boxes being sealed at counting sure we did, that it was either mis- porters, including a representative of sites with serial numbered seals that may placed or improperly used or some- one of the major networks. The first not correspond to actual voting site number; sealed ballot boxes are being thrown away. thing. question that was asked was what did Registration Cards: Registration records in The real point here, I say to my we think about the report that had total disarray; registration records being jet- friend from Iowa, is I do not know how been issued a few hours earlier on Sat- tisoned into the trash in large quantities; much money was spent. I know money urday morning—this is the day before unused registration cards (remember one was spent, but I know that these are the election—by the IRI criticizing the million missing) found in large quantities. trained observers who observe election election that had not yet taken place? This is not a result of after election after election around the Obviously, we were in no position to underdevelopment nor simple mis- world and judged the election in Russia comment on a report that we had not June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9147 seen about an election that had not yet either influence the election in that was held. Many of the shortcomings taken place. country or to influence domestic poli- which were cited by the Senator from Mr. MCCAIN. Will the Senator yield tics within the United States. I do not Arizona and the Senator from Georgia to me to respond to that? think that the process of American po- were the result of an attempt to in- Mr. GRAHAM. I would like to com- litical party involvement is advanced crease the democracy of the elections. plete my comments and then yield. by issuing a report of 300 pages on the They may have been attempts which Mr. MCCAIN. The Senator made a se- morning before the election. That is exceeded the capability of those re- rious charge. I would like him to let my judgment. I would not recommend sponsible for administering the elec- me respond. that that be done. Others may have dif- tion. As an example, a decision was Mr. GRAHAM. That is not a charge. ferent assessments as to the propriety made that no precinct would have more It is a factual statement. of doing so, and I would not state that than 400 registered voters. The theory Mr. MCCAIN. As the Senator knows, my values on this are biblical or abso- was that they did not want to overbur- it is the preelectoral process and, to be lute, but they are my values. den the people who were at the pre- fair, the Senator from Florida ought to Mr. President, after having gotten off cinct and had the responsibility for say that. They did not comment on the the plane and responding to that series managing by having an excessive num- election itself, they commented on the of reporters’ questions, we then went to ber of voters at each precinct. The preelectoral process. Let us not distort a series of sessions in which we were number 400 was selected as a manage- the record here, I say to my friend briefed as to what we might expect on able number. from Florida. election day and some of the prepara- The problem with that was that they Mr. GRAHAM. I am not distorting tion for this election. ended up with over 12,000 precincts in the record. They were commenting and Let me say, this election is one that order to have everybody in a precinct made a conclusionary statement as to originally was supposed to have taken with no precinct more than 400. Even what they thought the status of the place in February or March of this more than that, because of the attempt election was 24 hours before the elec- year, coincident with the completion of to allow as many people a chance to tion took place. the term of all of the members of the register as possible, registration did Mr. MCCAIN. I say to my friend from lower house of the Haitian Parliament not close until a few days before last Florida, I have the document in my and approximately half of the members Sunday’s election. So you had many hand: ‘‘Preelectoral Assessment of the of the Haitian Senate. Because of a va- people who registered late, who were June 25, 1995, Election.’’ riety of difficulties in getting the elec- assigned to one of these precincts with Mr. GRAHAM. You do not have the tion organized, it was postponed sev- no more than 400 people, where they document in your hand. eral times and finally took place last did not have the time or the logistical Mr. MCCAIN. Preelectoral. Sunday. capability to get the ballots printed Mr. GRAHAM. Because the document There will be a runoff election to- out to those precincts that were cre- was approximately 300 pages long, as- wards the end of July in those races ated in order to accommodate the late sessing an election that was 24 hours where there was not a majority of the registrants. Probably, in retrospect— yet before it was to commence. vote secured by any candidate. and maybe this will be a lesson to be Mr. MCCAIN. I have the executive I think it is important—and I say applied at the runoff election next summary of the 300-page document, this not in an attempt to create an un- month and at the Presidential election and it clearly states ‘‘preelectoral.’’ duly positive sense of the atmosphere, at the end of the year—they will close Preelectoral. environment, but the reality of con- the registration books earlier to assure Mr. GRAHAM. It seems to me that it ducting an election in Haiti. that there is an adequate amount of would have—and this is just my assess- First, you are dealing with a nation time to process all of the registered ment, this is my editorial judgment— that has a very high proportion of its people and get the materials to those that it would have been more appro- population that is illiterate. Because of precincts. priate to have made such an assess- that, the ballots that were printed That is an example of the kind of cir- ment after the election had taken were some of the more complex ballots cumstance which started from a good place as opposed to the morning prior that I have ever seen. They were multi- motive, to get as many people reg- to the election taking place. And it colored, in order to depict the parties istered and participate as possible, would have been more appropriate to by being able to fully illustrate the which ended causing the kinds of prob- have deferred to what has been the tra- party symbols. If it was a rooster, it lems that have been cited. dition of American politics, which is was a red rooster, with all of the color- I talked to IRI—International Repub- that partisan politics end at the Na- ation of the rooster. They also had pic- lican Institute—people who were actu- tion’s boundaries. tures of all of the candidates for the ally out in the field in the precincts The reality is—— Senate. And in the first voting precinct and small towns. I talked to OAS rep- Mr. MCCAIN. Will the Senator yield that I visited in Cite Soleil, one of the resentatives in Port-au-Prince, and to again? Is the Senator impugning the large slum areas in Port-au-Prince, others who were observing the election. integrity of Congressman GOSS, who there were 29 candidates for the Senate I asked, ‘‘Is there any evidence that was the leader of that organization, from that particular district, two of these problems were intended to bene- saying that he took partisanship past whom would be elected. There were 29 fit a party or a set of candidates?’’ The the water’s edge? If the Senator has pictures of each of those candidates for answer was, from all sources, ‘‘no.’’ evidence—— the Senate. These are logistically dif- The problems, the shortfalls, were as a The PRESIDING OFFICER. The Sen- ficult steps to take in order to assure result of incompetence, maybe an over- ator from Florida has the floor. that people, many of whom cannot read reaching in terms of the desire to ex- Mr. GRAHAM. I am not impugning and write, would be able to cast an in- tend the election to all of the people, anyone’s integrity. I am suggesting formed ballot. and to the kind of basic circumstances that I believe that where the United We are also dealing with a country that are the atmosphere, the environ- States sends organizations to a foreign which has had only two elections with- ment for any election in a country like country to serve as objective election in a whole generation. People do not Haiti. But there was no evidence that observers, that both in terms of their have much experience—those people those were intended to serve partisan objectivity as election observers and in who are running the election, those political advantage. the spirit that partisan politics end at people who are participating in the As some have said, we are going to the Nation’s boundaries, that it would election. Basic electoral infrastructure have an early opportunity to see be appropriate to defer observations on is largely missing. Highways are ex- whether some of the lessons learned the election until after the election has tremely substandard. Telephone and last Sunday will be applied, because taken place. other means of communication are there are going to be a second round of There is a suspicion raised that the often nonexistent. elections in just a matter of 4 weeks. It purpose of issuing a report on an elec- So those are some of the practical will be the opportunity for those re- tion 24 hours before it commences is to circumstances under which an election sponsible for the electoral process to S 9148 CONGRESSIONAL RECORD — SENATE June 27, 1995 incorporate some of those lessons that operative democracy with an economy the wake of the U.S.-led military interven- have been learned, in seeing that the that provides opportunity and a future tion in September that restored President next round of elections are more or- for its people and a government which Jean-Bertrand Aristide to office after three years of exile. derly. respects the rights and dignity of each The next test comes July 23, with a runoff Let me just recite some of the vi- individual citizen of Haiti. for Senate and Chamber of Deputies can- gnettes that stick in my mind of this (Ms. SNOWE assumed the chair.) didates who did not win a majority in Sun- election. In 1987, there were elections Mr. DODD. If my colleague will yield. day’s balloting. All 83 seats in the lower scheduled in Haiti, and as people lined Madam President, I want to commend house and 18 in the 27-seat Senate were con- up at 6 o’clock in the morning to vote, our colleague from Florida, who took tested. the Tontons Macoutes came by with the time, once again, as he has on nu- Both Sunday’s vote and the July 23 runoff machine guns and slaughtered people merous other occasions, to personally are curtain-raisers for year-end presidential elections. in the voting lines. You would think participate and observe routine, watch- ‘‘We’re voting for democracy to advance,’’ that kind of circumstance that oc- ing the elections in Haiti. pronounced a smiling Aristide after voting curred less than a decade ago would Senator GRAHAM of Florida has a near his residence on the outskirts of Port- create a sense of anxiety and apprehen- consistent and longstanding interest in au-Prince. sion for people to go out and vote on a Haiti, and I think it is worth our while. Dressed in blue jeans and a white polo Sunday morning in 1995. That was not We anticipate and await a more de- shirt with green trim, the diminutive the case. People were, in fact, joyful in tailed report. Aristide, buried in a phalanx of security offi- their attitudes. They were enthusiastic I was particularly interested in hear- cials and aides, walked the half-mile from his home to the polling station at the St. about the opportunity to vote. At 6 ing your firsthand accounts of what ac- John Paul II church and school complex. o’clock in the morning in Cite Soleil— tually occurred this past weekend, Aristide emerged 15 minutes later, showing the same place people were being shot with all of the shortcomings that oc- a crowd of journalists and admirers his down 8 years ago—40 people were curred. thumb coated in indelible ink, a sign he had standing in line waiting to be able to I read with some interest the depar- voted. be the first to vote at that particular ture statement of the U.S. Presidential A far greater problem than the few scat- precinct. It was an exciting exhilarat- delegation who observed the Haitian tered and mostly minor incidents of violence across the country, were the almost univer- ing experience to see people who want- elections and the number of places that sal complaints of snafus at the 10,000 polling ed so much to participate in democ- the delegation—some 300 polling sites— stations. racy. observed complicated balloting proce- Many polling places opened late, some by I was particularly impressed with the dures involving elections for more than several hours. In others, ballots and other number of young people. I just read an 2,100 legislative, mayoral and local voting materials were missing. In some article about the low participation in council offices, 25 political parties, and cases, so were poll workers. Transportation American elections by our youngest it goes on how complicated this process was a problem, with all but official and pub- voters. In Haiti, the youngest voters was. lic vehicles banned from the streets. The ban also applied to all commercial airline flights. seem to be the most participating. I The delegation notes here that: For the most part, Haitians waited pa- made a point, through a translator, of Despite repeated misunderstandings over tiently outside polling stations as electoral asking a number of these young people the actions of election officials at all levels, officials scurried to correct the deficiencies. why they were doing this. Why was this the delegation saw little evidence of any ef- With about 80 percent of Haitians illit- 18-year-old out on a Sunday morning fort to favor a single political party or of an erate, many voters struggled to decipher a standing in line to vote? The answer organized attempt to intentionally subvert multitude of party symbols on the ballots. was, ‘‘This is my country, this is my the electoral machinery. At many points, Independent candidates were identified with the Provisional Electoral Council’s actions future. It is important to me and my a Haitian flag. Voters also got help from and public statements raised questions about election officials in marking their ballots country that democracy work.’’ the credibility of the process. The most sig- and depositing them correctly. That is exactly the kind of spirit nificant of the problems was the failure to Electoral officials estimated that about 90 that will drive this country into a bet- explain the reasons candidates were rejected. percent of eligible Haitians—3.5 million—had ter future, the kind of spirit that will Political parties raised these and other con- registered to vote. There were no immediate begin to eradicate those circumstances cerns relating to the transparency of the figures available of how many actually that have made holding an election in elections in their contacts within the delega- voted, but turnout appeared to be heavy, al- June 1995 so difficult. tion. though not equal to that of the December So, Mr. President, as I said, I will be It goes on. I think it points out the 1990 election that swept Aristide to office. submitting a fuller report at a later success of this delegation. Results for the local, district and the first Last, Mr. President, in the Miami round of parliamentary elections are not ex- time, but I wanted to put in context pected for at least a week, because the bal- what is happening in this country. I do Herald, Monday, June 26, edition, lots have to be counted by hand. ‘‘Haiti: Ballots, Not Bullets.’’ I think it not intend to be naive or Pollyannaish FOREIGN ASSESSMENT about the difficulties, including the is a worthwhile headline to note, Bal- The tentative assessment was that Sun- difficulties of this election. But I be- lots Not Bullets. day’s vote probably met at least the mini- lieve that we, as Americans, can take Historic vote is mostly free of violence. mum standards for a credible election. A pride in what we have accomplished, Democracy scored a fragile victory Sunday final verdict is expected today, when up to taking a country which a year ago was as Haitians trooped to the polls under a blaz- 1,000 foreign observers offer their assess- under one of the most brutal dictator- ing sun and a cloud of confusion to vote on ment. And it’s likely that even they might ships in modern history in the Western all but 10 of the country’s 2,205 elected of- not agree. fices. Hemisphere, where bodies where show- ‘‘There were the kind of administrative I ask unanimous consent to have the problems we anticipated, but Haitians as a ing up every morning butchered as a whole voted without intimidation or fraud in result of the previous night’s brutality article printed in the RECORD. There being no objection, the article the electoral process,’’ said a Clinton admin- by agents of a military dictatorship; istration official participating in the 20- and now we have people standing up- was ordered to be printed in the member U.S. presidential delegation wit- right, prideful of their country, opti- RECORD, as follows: nessing the vote. mistic of their personal future, desir- HAITI: BALLOTS, NOT BULLETS ‘‘I have been in many African countries for ous of being a part of the future of (By Don Bohning and Susan Benesch) elections and they are doing very well here,’’ was the midmorning assessment of Sen. their nation and seeing democracy as PORT-AU-PRINCE.—Democracy scored a fragile victory Sunday as Haitians trooped Jacques Goillet, member of a French par- the means by which that future would liamentary observer delegation. be achieved. to the polls under a blazing sun and a cloud I think we should take some pride in of confusion to vote on all but 10 of the coun- POSITIVE SIDE that and that we will be able to look try’s 2,205 elected offices. While the credibility of the election may Perhaps most important, the election was be debated, on the clearly positive side there back, I hope, at this experience last virtually free of the violence that marred were no reports of major election day vio- Sunday as an important step in what previous ones. lence. will be a long path toward the emer- Sunday’s was the first and most com- The most serious incidents of election-re- gence of Haiti as a fully committed, plicated of three crucial electoral tests in lated violence occurred overnight Friday in June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9149 the northern areas of Limbe, Le Bourgne and boxes deposited by angry election and Knight. He is a former Counsel and Staff Dondon. Sunday’s vote was called off in all workers who said they had not been Director to Congressman Charles Rangel (D– three places, with the expectation it would paid.’’ NY) and was a Deputy Assistant Secretary of be rescheduled in conjunction with the July The Washington Post reports: State in the Carter Administration. 23 runoff. Mary Dunea: Ms. Dunea is Assistant to In Limbe, somebody threw a firebomb into Parties and election observers across the Governor Jim Edgar of Illinois. She directs the electoral offices, destroying thousands of political spectrum—from the government of cultural and international initiatives for ballots. In neighboring Dondon, election offi- President Jean-Bertrand Aristide—today Governor Edgar and serves as his liaison cials decided to shut down to prevent prob- criticized as chaotic and disorderly elections with groups involved in developing inter- lems. And in Le Bourgne, a mob attacked the Sunday that were considered a key step in national trade. electoral offices, stealing seven boxes of elec- establishing democracy in this impoverished George A. Fauriol, Ph.D.: Dr. Fauriol is Di- tion materials. They were later recovered nation. rector and Senior Fellow, American Pro- but in unusable condition. To be fair I should go on: grams with the Center for Strategic & Inter- There seems to be little doubt the election But most said the disarray did not invali- national Studies in Washington, D.C. At violence was held to a minimum by 6,000 for- date the voting, and even the Republican ob- CSIS, he directs the program in engaging eign troops—including 2,400 Americans—re- server team said the irregularities were not policy makers in Canada, the United States, maining here as part of a United Nations enough to prompt a cutoff of U.S. aid. Mexico, Latin American and the Caribbean force. Along with about 1,000 international in pivotal issues of common concern, such as police monitors, they were deployed nation- Nor am I seeking a cutoff of U.S. aid. trade, democratization, and security mat- wide. ‘‘The process is very badly organized, and ters. Florida Sen. Bob Graham, observing the we, the government, are not proud of it,’’ Ronald Fuller: The owner of an advertising vote, said he was ‘‘pleased by what I have said Jean-Claude Bajeaux, the Minister of and public relations firm in Little Rock, Ar- seen so far.’’ Culture, in a radio interview. ‘‘Instead of im- kansas, Mr. Fuller serves as a consultant on Almost to a voter, Haitians in line in Cite proving on the 1990 elections, we have done governmental and media relations to busi- Soleil, a Port-au-Prince slum, said they were worse.’’ nesses, trade associations, and political can- voting for the candidates of the ticket Now, this is the Minister of Culture didates. He served as a communications and known as The Table, who are favored by in Haiti. political party trainer on an IRI mission to Aristide. Madam President, we are wasting the Latvia and Lithuania. Mr. DODD. I want to commend my Rich Garon: Mr. Garon is Chief of Staff of time of the Senate in a way, because the U.S. House of Representatives Commit- colleague for his efforts and for sharing the facts are going to come out on this his observations here. This was not tee on International Relations. He is a long- election. These are the first initial ob- time assistant to Committee Chairman Ben perfect by any standards. Given what servations made by qualified observers, Gilman (R–NY) and has extensive experience we have seen over the years here, this and I think more and more evidence is in developing foreign policy legislation. does offer at least some significant pouring in that this election did not Kevin T. Lamb: Mr. Lamb is a partner and hope—that the comments you heard meet the minimum standards in order chair of the creditors’ rights, business re- from young people about what they structuring, and bankruptcy practice group to judge an election as fair and equi- at Testa, Hurwitz & Thibeault in Boston, wish for, why they were going through table and that the people are allowed the process of voting, is something Massachusetts. Mr. Lamb represents major to select their leadership. lending institutions and venture capital that we can get behind and nourish and I just want to emphasize, Madam funds in corporate reorganization and work- try to encourage in the coming years. President, that this election was ob- out arrangements. I thank my colleague for his efforts. served by unbiased observers. I will Kirsten Madison: Ms. Madison is Senior Mr. McCAIN. Madam President, provide for the RECORD the names of Legislative Assistant to U.S. Representative while my friend from Florida is on the those individuals who made the obser- Porter Goss (R-FL). She manages the Con- floor, International Republican Insti- gressman’s initiatives regarding U.S. policy vations. toward Haiti, as well as has oversight re- tute has similar preelection reports There being no objection, the ordered from Nicaragua, China, El Salvador, sponsibilities involving other foreign policy printed in the RECORD, as follows: legislation. Slovenia, just to name a few. The Na- OBSERVATION DELEGATION Roger Noriega: Mr. Noriega is a profes- tional Democratic Institute has issued CHAIRMAN OF THE DELEGATION: sional staff member on the U.S. House of preelection reports in the course of Representatives International Relations U.S. Representative Porter J. Goss: Con- their monitoring of elections. Committee, responsible for issues involving gressman Goss (R–FL) is serving his fourth U.S. interests in Latin America, the Carib- For the Senator from Florida to term in the House. He has a particular inter- bean, and Canada. He has actively monitored somehow believe that this is an un- est in Latin American policies and served as the situation in Haiti since the 1991 coup and usual or inappropriate measure is sim- an election observer to the 1990 electoral has visited Haiti twice in the last six months ply, I think, incorrect, in light of the process in Nicaragua. Congressman Goss is a and met with President Aristide. Before join- member of the Select Committee on Intel- fact that it is a normal, standard pro- ing the House committee, he served at the ligence, the House Ethics Committee, and cedure for electoral observation teams State Department, the Agency for Inter- the House Rules Committee. to make these reports. national Development, and the Organization I will be glad to provide for the DELEGATION (IN ALPHABETICAL ORDER) of American States. RECORD all those that the National Cleveland Benedict: Mr. Benedict rep- Martin Poblete: Professor Poblete is the Democratic Institute also completed. resented the Second District of West Vir- permanent adviser on Latin American Af- Because this report was very critical ginia in the U.S. House of Representatives fairs at the Northeast Hispanic Catholic Cen- from 1980–1982, and he has served as the state in no means, in my view, invalidates it. ter in New York. He is also Chairman of Co- Commissioner of Agriculture, as well as a lumbia University Seminar on Latin Amer- I would like to point out I know that Deputy Assistant Secretary of the U.S. De- ica and a Professor of History at Rutgers the Senator from Florida knows that partment of Agriculture. He is the President University. Congressman GOSS, of all people, is of Ben Buck Farms in Lewisburg, West Vir- Steve Rademaker: Mr. Rademaker is Chief highly qualified. He is a former mem- ginia. Counsel of the Committee on International ber of the CIA—I think the only mem- Jeff Brown: Mr. Brown is Director of Grass- Relations of the U.S. House of Representa- ber of the other body that is a member roots Development with the Republican tives. Prior to joining the committee staff in of the CIA. Party of Virginia. Prior to joining the state 1993, he had served as General Counsel for Party, he served in Governor Allen’s Admin- I would say to my friend from Flor- the Peace Corps and Associate Counsel to istration as Director of the Commission on the President and Deputy Legal Adviser to ida, at no time, in 4 years of observing Citizen Empowerment and was with Em- the National Security Council during the 48 elections, has the International Re- power America. Bush Administration. publican Institute or the National Malik M. Chaka: Mr. Chaka is the Director Therese M. Shaheen: Ms. Shaheen, who has Democratic Institute, been challenged of Information for Free Angola Information wide-ranging experience working in Asia, the on the basis of party bias. If they did, Service in Washington, D.C., and editor of Middle East, and Europe, is President, Chief if there was any of that, they would Angola Update, an internationally distrib- Operating Officer and Co-founder of U.S. have no credibility. uted monthly newspaper. As a Tanzanian- Asia Commercial Development Corporation based free lance journalists in the 1970’s, Mr. in Washington, D.C. U.S. Asia develops and While we are looking at newspapers, Chaka has observed the advance of demo- manages commercial projects for American here is a picture at a counting station cratic processes in southern Africa. firms in Asia. in downtown Port-au-Prince. ‘‘Monique George Dalley: Mr. Dalley is a partner with Tim Stadthaus: Mr. Stadthaus is Legisla- Georges reacts to the state of ballot the Washington, D.C. law firm of Holland tive Assistant and Assistant Press Secretary S 9150 CONGRESSIONAL RECORD — SENATE June 27, 1995 to U.S. Representative William F. Goodling Mr. GRAHAM. Could I ask the Sen- Specialized securities lawyers win big (R-PA). He monitors foreign relations mat- ator from New York a question? Your bucks by filing meritless lawsuits against ters and oversees related legislation initi- unanimous consent—are you going to many of America’s most promising compa- ated by Congressman Goodling, who is a provide some time in the morning prior nies. The securities lawyers profit hand- member of the House International Rela- somely, but Americans with money in tions Committee. to the vote for a brief statement for stocks, pensions and mutual funds are the John Tierney Ph.D.: Dr. Tierney is a mem- those who may not be able—— losers in the deal. ber of the faculty at Catholic University in Mr. D’AMATO. It would be our intent This is what editorial writers across the Washington, D.C. and also teaches at the to vote this evening, probably by about Nation are saying about securities lawsuit University of Virginia and Johns Hopkins. 8 o’clock. abuse: He has served as Director of the U.S. House Mr. GRAHAM. I am sorry. From ear- And then the ad quotes a number of of Representatives Caucus on National De- lier comments, I understood it was sug- newspapers which have taken a posi- fense, as a consult to the Heritage Founda- gested otherwise. tion, and as a Special Assistant with the U.S. tion in support of this legislation. It Arms Control and Disarmament Agency dur- Mr. D’AMATO. We had attempted to happens that the first of those news- ing the Reagan Administration. get an agreement to stack the votes, papers is from my State, the Tampa Jacqueline Tillman: Ms. Tillman is Senior but there was an objection to stacking Tribune, June 25, 1995: Staffer for National Security Affairs and Di- more than a certain number. It is my The situation now is that all investors are rector of Issue Advocacy for Empower Amer- intent to dispose of the Senator’s paying the costs of settling lawsuits that ica in Washington, D.C. Before joining Em- amendment prior to disposing of the should never have been filed. ... [T]he time power America, she was Executive Vice Boxer amendment. has come to pull the legal leeches off the President of the Cuban American National May I ask at this point unanimous backs of corporations that have done no Foundation, Director of Latin America pol- wrong. icy with the National Security Council dur- consent that when the Senate consid- ers the Graham amendment, there be 1 That is from the Tampa Tribune. ing the Reagan Administration and an as- The next is from the Rocky Moun- sistant to U.S. Ambassador to the United Na- hour for debate, to be equally divided tions Jeane Kirkpatrick. in the usual form, and no second-degree tain News: Mr. McCAIN. People can honestly amendments be in order. .. . the nogoodniks suffer at the same rate as the straight-shooters. Meanwhile, who disagree on what they observed. But to The PRESIDING OFFICER. Without objection, it is so ordered. profits? A coterie of lawyers with stock allege that somehow agreement or dis- charts and fill-in-the-blanks fraud com- agreement with administration policy Mr. D’AMATO. Madam President, I plaints. further ask that following the conclu- concerning Haiti would somehow affect That is the January 18, 1995, Rocky sion or yielding back of the time on the one’s view of this election, I think, Mountain News. does great disservice to the people Graham amendment, that the amend- The Chicago Tribune of March 29 of what took their time and their effort. ment be laid aside and Senator BOXER this year: be recognized to offer an amendment The Senator from Florida certainly . . . groundless lawsuits by shareholders knows how unpleasant the conditions regarding insider trading, on which alleging fraud . . . are often merely a way of are down there. They may disagree there would be 90 minutes for debate to extorting settlements from corporations with the Senator from Florida as to be equally divided in the usual form, whose stock prices have dropped. the veracity of the elections, but I can- and no second-degree amendments to Madam President, I ask unanimous not, without any evidence, accept any be in order. consent the totality of the ad from to- allegation that the observation of Mr. SARBANES. Madam President, I day’s Washington Post be printed in these elections and the conclusions will have to object to that request. the RECORD immediately following my that were reached by these observers The PRESIDING OFFICER. Does the remarks. were in any way colored by their view Senator object? Objection is heard. The PRESIDING OFFICER. Without of United States policy toward Haiti. Mr. D’AMATO. Well, then, we pro- objection, it is so ordered. I am sure that my friend from Flor- ceed to the Graham amendment. (See exhibit 1.) ida would not intimate such a thing. I The PRESIDING OFFICER. The Sen- Mr. GRAHAM. Madam President, want to make the record clear and I ator from Florida. that is the stated problem: Frivolous, want to thank the Senator from Flor- AMENDMENT NO. 1479 meritless lawsuits. But what do we ida for his many-year-long involve- (Purpose: To provide for an early evaluation have? Is that the prescription that has ment in the issue of Haiti, for his procedure in securities class actions) come out in S. 240? Is it legislation strong advocacy for freedom and de- Mr. GRAHAM. Madam President, be- which is targeted at eradicating the mocracy in Haiti, and his continued fore I offer my amendment, I would tumor of meritless lawsuits? Unfortu- knowledgeable and informative manner like to make a few comments relative nately not. as far as the region is concerned. I to this legislation. When I approach a If I may quote from another news- yield the floor. piece of legislation, I like to do so by paper, the Miami Herald of yesterday, f asking some basic questions, the first which stated, under the headline, ‘‘Li- of which is: What is the problem? What cense to steal’’: PRIVATE SECURITIES LITIGATION is it that we do not like about the sta- Practically everyone in Washington, to REFORM ACT tus quo that has caused us to propose some degree or other, has blamed ‘‘frivolous The Senate continued with the con- some alteration of the status quo? or abusive lawsuits’’ for sapping America’s sideration of the bill. In this case, that diagnosis has been economic vigor. And judging from anecdotes, Mr. D’AMATO. Madam President, I very consistent, clear, and trumpeting, the complaint has some merit. But more know the distinguished Senator from and it is that we have too many frivo- often than not, the proposed cures turn out to be far more debilitating than the disease. Florida, Senator GRAHAM, is about to lous lawsuits that relate to securities A perfect illustration is a bill moving offer an amendment. fraud. through Congress that supposedly protects It would be my intent when the rank- I cite as my evidence of that an ad the securities industry from ‘‘frivolous’’ ing member returns, Senator SAR- which appeared on page A7 of today’s suits by investors. BANES, to offer a unanimous-consent Washington Post, under the headlines, The bill may come to a Senate vote today. agreement, the nature of which is we ‘‘Who Profits? ‘A Coterie of Lawyers’.’’ It would bar, among many other things, would have 1 hour equally divided on This ad was in support of S. 240, and charges of fraud against those who make false projections of a company’s likely per- Senator GRAHAM’s amendment, and we it was placed by ‘‘America Needs More formance. By granting ‘‘safe harbor’’ to all then would proceed to Senator BOXER’s Investors, Not More Lawsuits,’’ under statements of a ‘‘forward-looking’’ nature, it amendment. the sponsorship of American Business essentially tells companies and brokers: Go I see Senator SARBANES is here. I Conference and American Electronics ahead, lie about the future. As long as you’re yield the floor to Senator GRAHAM so Association. not misrepresenting the past, you can fleece he can start and offer his amendment, What did the proponents of this legis- investors in any way that your imagination and at some point in time he might lation say was the reason that we have allows. break to propound the unanimous-con- S. 240 before us this evening? Quoting Madam President, I ask unanimous sent agreement. from the ad: consent the editorial from the June 26, June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9151 1995, Miami Herald also be printed in The PRESIDING OFFICER. The ‘‘(4) EVALUATION BY THE MEDIATOR.— the RECORD immediately after my re- clerk will report. ‘‘(A) IN GENERAL.—If, at the end of the marks. The legislative clerk read as follows: early evaluation procedure described in para- graph (1), the action has not been volun- The PRESIDING OFFICER. Without The Senator from Florida [Mr. GRAHAM] tarily dismissed or settled, the mediator proposes an amendment numbered 1479. objection, it is so ordered. shall evaluate the action as being— (See exhibit 2.) Mr. GRAHAM. Madam President, I ‘‘(i) clearly frivolous, such that it can only Mr. GRAHAM. What I think has hap- ask unanimous consent that reading of be further maintained in bad faith; pened, Madam President, is we had a the amendment be dispensed with. ‘‘(ii) clearly meritorious, such that it can goal to eliminate frivolous lawsuits The PRESIDING OFFICER. Without only be further defended in bad faith; or which could have been hit easily with a objection, it is so ordered. ‘‘(iii) described by neither clause (i) nor .22 rifle. We have now used a howitzer, The amendment is as follows: clause (ii). ‘‘(B) WRITTEN EVALUATION.—An evaluation which has cratered in a large area of On page 104, after line 22, insert the follow- the legitimate rights of American in- required by subparagraph (A) with respect to ing: the claims against and defenses of each de- vestors when they are subjected to abu- (c) EARLY EVALUATION PROCEDURES.— fendant shall be issued in writing not later (1) SECURITIES ACT OF 1933.—Section 20 of sive and to fraudulent activities. We than 10 days after the end of the early eval- the Securities Act of 1933 (15 U.S.C. 77t) is have created a situation in which it is uation procedure and provided to the parties. amended by adding at the end the following going to be much more difficult to The evaluation shall not be admissible in the new subsection: maintain any kind of suit, serious or action, and shall not be provided to the court ‘‘(j) EARLY EVALUATION PROCEDURES IN until a motion for sanctions under paragraph frivolous, where fraud is alleged. We CLASS ACTIONS.— (5) is timely filed. have shortened the statute of limita- ‘‘(1) IN GENERAL.—In a private action aris- ‘‘(5) MANDATORY SANCTIONS.— tions. We have provided protection for ing under this title that is filed as a class ac- ‘‘(A) CLEARLY FRIVOLOUS ACTIONS.—In an those who assisted in the fraudulent tion pursuant to the Federal Rules of Civil action that is evaluated by the mediator behavior of the principals. We have cre- Procedure, if the class representatives and under paragraph (4)(A)(i), upon final adju- ated a circumstance of a conflict of in- each of the other parties to the action agree dication of the action, the court shall in- terest by designating the largest inves- and any party so requests, or if the court clude in the record specific findings regard- tor in the company as the principal upon motion of any party so decides, not ing compliance by each party and each attor- plaintiff in these types of cases. These later than 60 days after the filing of the class ney representing any party with each re- action, the court shall order an early evalua- are just some of the things that have quirement of rule 11(b) of the Federal Rules tion procedure. The period of the early eval- of Civil Procedure. happened, all under the pretext that we uation procedure shall not extend beyond 150 are going to be dealing with frivolous ‘‘(B) MANDATORY SANCTIONS.—If the court days after the filing of the first complaint makes a finding under subparagraph (A) that lawsuits. subject to the procedure. a party or attorney violated any require- I suggest that there are serious con- ‘‘(2) REQUIREMENTS.—During the early ment of rule 11(b) of the Federal Rules of sequences of this type of legislation, evaluation procedure described under para- Civil Procedure, the court shall impose sanc- and what it is likely to lead to for the graph (1)— tions on such party or attorney in accord- American free enterprise system. It ‘‘(A) defendants shall not be required to ance with rule 11 of the Federal Rules of was only 100 years ago that we had a answer or otherwise respond to any com- Civil Procedure. plaint; ‘‘(C) PRESUMPTION IN FAVOR OF ATTORNEYS’ very predatory form of free enterprise ‘‘(B) plaintiffs may file a consolidated or in the United States. We had large FEES AND COSTS.— amended complaint at any time and may dis- ‘‘(i) IN GENERAL.—Subject to clauses (ii) companies using their power in an abu- miss the action or actions at any time with- and (iii), for purposes of subparagraph (B), sive way to squelch small competitors, out sanction; the court shall adopt a presumption that the to gain monopolistic economic control. ‘‘(C) unless otherwise ordered by the court, appropriate sanction for failure of the com- We had extreme swings in our business no formal discovery shall occur, except that plaint to comply with any requirement of cycle, in large part attributed to that parties may propound discovery requests to rule 11(b) of the Federal Rules of Civil Proce- predatory behavior. We had the growth third parties to preserve evidence; dure is an award to the opposing party of all of populism and other forms of politi- ‘‘(D) the parties shall evaluate the merits of the reasonable attorneys’ fees and other of the action under the supervision of a per- cal dissent, as farmers and workers felt expenses incurred as a direct result of the son (hereafter in this section referred to as violation. as if they were being the targets of this the ‘mediator’) agreed upon by them or des- ‘‘(ii) REBUTTAL EVIDENCE.—The presump- predatory behavior. ignated by the court in the absence of agree- tion described in clause (i) may be rebutted The free enterprise system in Amer- ment, which person may be another district only upon proof by the party or attorney ica was in a very precarious condition. court judge, any magistrate-judge or a spe- against whom sanctions are to be imposed Free enterprise has flourished in Amer- cial master, each side having one peremptory that— ica when people felt that the rules of challenge of a mediator designated by the ‘‘(I) the award of attorneys’ fees and other free enterprise were fair and that ev- court by filing a written notice of challenge expenses will impose an undue burden on eryone was going to be treated equally, not later than 5 days after receipt of an that party or attorney; or that people could invest in firms—not order designating the mediator; ‘‘(II) the violation of rule 11(b) of the Fed- ‘‘(E) the parties shall promptly provide ac- without risk; that is the nature of the eral Rules of Civil Procedure was de cess to or exchange all nonprivileged docu- minimis. marketplace. But at least they were ments relating to the allegations in the com- ‘‘(iii) SANCTIONS.—If the party or attorney going to be treated with some discre- plaint or complaints, and any documents against whom sanctions are to be imposed tion and some level of an equal playing withheld on the grounds of privilege shall be meets its burden under clause (ii), the court field. sufficiently identified so as to permit the shall award the sanctions that the court I am afraid that legislation such as mediator to determine if they are, in fact, deems appropriate pursuant to rule 11 of the S. 240—which is going to be seen as, privileged; and Federal Rules of Civil Procedure. and I believe will in fact result in, a ‘‘(F) the parties shall exchange damage ‘‘(6) EXTENSION OF EARLY EVALUATION PE- tilting of the economic playing field studies and such other expert reports as may RIOD.—The period of the early evaluation be helpful to an evaluation of the action on toward those who would be inclined to procedure described in paragraph (1) may be the merits, which materials shall be treated extended by stipulation of all parties. At the wish to abuse it and to use it for their as prepared and used in the context of settle- conclusion of the period, the action shall own fraudulent purposes—will under- ment negotiations. proceed in accordance with Federal Rules of mine that essential confidence of the ‘‘(3) FAILURE TO PRODUCE DOCUMENTS.—Any Civil Procedure. American people in their economic in- party that fails to produce documents rel- ‘‘(7) FEES.—In a private action described in stitutions. evant to the allegations of the complaint or paragraph (1), each side shall bear equally So, with that, Madam President, I complaints during the early evaluation pro- the reasonable fees and expenses of the medi- have an amendment that I would like cedure described in paragraph (1) may be ator agreed upon or designated under para- to propose. It is an amendment which I sanctioned by the court pursuant to the Fed- graph (2)(D), if the mediator is not a judicial will send to the desk which actually eral Rules of Civil Procedure. Notwithstand- officer.’’. ing paragraph (2), subject to review by the goes directly at the issue of frivolous (2) SECURITIES EXCHANGE ACT OF 1934—Sec- court, the mediator may order the produc- tion 21 of the Securities Act of 1933 (15 U.S.C. lawsuits. tion of evidence by any party and, to the ex- 78a) is amended by adding at the end the fol- Madam President, I send the amend- tent necessary properly to evaluate the case, lowing new subsection: ment to the desk and ask for its imme- may permit discovery of nonparties and ‘‘(l) EARLY EVALUATION PROCEDURES IN diate consideration. depositions of parties for good cause shown. CLASS ACTIONS.— S 9152 CONGRESSIONAL RECORD — SENATE June 27, 1995 ‘‘(1) IN GENERAL.—In any private action ‘‘(5) MANDATORY SANCTIONS.— this was a clearly frivolous action, and arising under this title that is filed as a class ‘‘(A) CLEARLY FRIVOLOUS ACTIONS.—In an if the final judgment is entered against action pursuant to the Federal Rules of Civil action that is evaluated under paragraph the plaintiff—that is, the plaintiff pro- Procedure, if the class representatives and (4)(A)(i) in which final judgment is entered ceeded forward to full litigation in each of the other parties to the action agree against the plaintiff, the plaintiff or plain- and any party so requests, or if the court tiff’s counsel shall be liable to the defendant spite of the fact that there had been an upon motion of any party so decides, not for sanctions as awarded by the court, which early evaluation that this was a clearly later than 60 days after the filing of the class may include an order to pay reasonable at- frivolous action, and the plaintiff had action, the court shall order an early evalua- torneys’ fees and other expenses, if the court in fact had the final judgment entered tion procedure. The period of the early eval- agrees, based on the entire record, that the against the plaintiff—then the plaintiff uation procedure shall not extend beyond 150 action was clearly frivolous when filed and or the plaintiff’s counsel shall be liable days after the filing of the first complaint was maintained in bad faith. to defendant for sanctions as awarded subject to the procedure. ‘‘(B) CLEARLY MERITORIOUS ACTIONS.—In an by the court, which may include an ‘‘(2) REQUIREMENTS.—During the early action that is evaluated under paragraph evaluation procedure described under para- (4)(A)(ii) in which final judgment is entered order to pay reasonable attorney’s fees graph (1)— against the defendant, the defendant or de- and other expenses, if the court agrees ‘‘(A) defendants shall not be required to fendant’s counsel shall be liable to the plain- based on the entire record that the ac- answer or otherwise respond to any com- tiff for sanctions as awarded by the court, tion was clearly frivolous when filed plaint; which may include an order to pay reason- and was maintained in bad faith. ‘‘(B) plaintiffs may file a consolidated or able attorneys’ fees and other expenses, if Madam President, if, on the other amended complaint at any time and may dis- the court agrees, based on the entire record, hand, this report of the early evalua- miss the action or actions at any time with- that the action was clearly meritorious and out sanction; tion found that this was a clearly meri- was defended in bad faith. torious action, and the defendant car- ‘‘(C) unless otherwise ordered by the court, ‘‘(6) EXTENSION OF EARLY EVALUATION PE- no formal discovery shall occur, except that RIOD.—The period of the early evaluation ried it through to final judgment, and parties may propound discovery requests to procedure described in paragraph (1) may be final judgment was entered against the third parties to preserve evidence; extended by stipulation of all parties. At the defendant, then the defendant, or the ‘‘(D) the parties shall evaluate the merits conclusion of the period, the action shall defendant’s counsel, shall be liable to of the action under the supervision of a per- proceed in accordance with Federal Rules of the plaintiff for the sanctions awarded son (hereafter in this section referred to as Civil Procedure. the ‘mediator’) agreed upon by them or des- by the court which may include reason- ‘‘(7) FEES.—In a private action described in ignated by the court in the absence of agree- able attorney’s fees and other expenses; paragraph (1), each side shall bear equally if the court agrees based on the entire ment, which person may be another district the reasonable fees and expenses of the medi- court judge, any magistrate-judge or a spe- ator agreed upon or designated under para- record that the action was clearly mer- cial master, each side having one peremptory graph (2)(D), if the mediator is not a judicial itorious and was defended in bad faith. challenge of a mediator designated by the officer.’’. Madam President, that is what we court by filing a written notice of challenge On page 105, line 5, strike ‘‘(j)’’ and insert are trying to do here. We are trying to not later than 5 days after receipt of an ‘‘(i)’’. create some effective sanctions against order designating the mediator; On page 106, line 25, strike ‘‘(l)’’ and insert ‘‘(E) the parties shall promptly provide ac- people bringing frivolous lawsuits. We ‘‘(k)’’. cess to or exchange all nonprivileged docu- are attempting to set up a procedure On page 108, line 24, strike ‘‘(k)’’ and insert ments relating to the allegations in the com- that will facilitate the delineation and ‘‘(j)’’. plaint or complaints, and any documents On page 109, line 8, strike ‘‘(l)’’ and insert early determination of the frivolous withheld on the grounds of privilege shall be ‘‘(k)’’. from the nonfrivolous and meritorious sufficiently identified so as to permit the On page 126, line 19, strike ‘‘(m)’’ and insert cases. It is hoped with that early deter- mediator to determine if they are, in fact, ‘‘(l)’’. mination the parties against whom privileged; and On page 127, line 6, strike ‘‘(m)’’ and insert ‘‘(F) the parties shall exchange damage this report is entered will not pursue it ‘‘(l)’’. studies and such other expert reports as may further, or, in the case of the defend- be helpful to an evaluation of the action on Mr. GRAHAM. Madam President, the ant, that they will settle the case with- the merits, which materials shall be treated time I just used should be counted out the necessity of prolonged and ex- as prepared and used in the context of settle- against the time which I was afforded pensive litigation. ment negotiations. to debate this matter. Is not that what we are here for? We ‘‘(3) FAILURE TO PRODUCE DOCUMENTS.—Any Madam President, the amendment have identified the problem as being party that fails to produce documents rel- that I send to the desk I do not purport frivolous lawsuits. Why do we not solve evant to the allegations of the complaint or to be original. complaints during the early evaluation pro- the problem of frivolous lawsuits and cedure described in paragraph (1) may be It is in fact a version of what ap- not allow that problem to become a sanctioned by the court pursuant to the Fed- peared in S. 240 as it was originally Trojan horse into which we load a lot eral Rules of Civil Procedure. Notwithstand- filed. It also draws heavily on language of other issues, of shortening statute of ing paragraph (2), subject to review by the that was contained in the Bryan-Shel- limitations, creating conflicts of inter- court, the mediator may order the produc- by bill, S. 667. What it attempts to do est by designating only the most afflu- tion of evidence by any party and, to the ex- is to provide an early evaluation proce- ent investor as the lead plaintiff, giv- tent necessary properly to evaluate the case, dure for litigation filed either under ing really quite unwarranted protec- may permit discovery of nonparties and the 1933 Securities Act, or the 1934 Se- depositions of parties for good cause shown. tion to persons who make projections ‘‘(4) EVALUATION BY THE MEDIATOR.— curities Act. It would provide that on about the future with knowledge that ‘‘(A) IN GENERAL.—If, at the end of the the motion of the parties, or by the those projections are false, giving in- early evaluation procedure described in para- motion of the court before whom the creased sanction and protection to graph (1), the action has not been volun- case has been filed, that there can be aiders and abettors who have acted in a tarily dismissed or settled, the mediator an independent mediator designated. reckless manner that has resulted in shall evaluate the action as being— That mediator would have the respon- investors of being defrauded? None of ‘‘(i) clearly frivolous, such that it can only sibility of reviewing all of the facts of those things are relevant to the issue be further maintained in bad faith; the litigation. After that review, the ‘‘(ii) clearly meritorious, such that it can of frivolous lawsuits. only be further defended in bad faith; or mediator would submit a report. That So, Madam President, I urge my col- ‘‘(iii) described by neither clause (i) nor report would contain a finding that the leagues to seriously consider this clause (ii). litigation was either one of three cat- amendment which is submitted in an ‘‘(B) WRITTEN EVALUATION.—An evaluation egories. It was either a clearly frivo- attempt to refocus our remedies on required by subparagraph (A) with respect to lous action; second, a clearly meritori- what has been general agreement to be the claims against and defenses of each de- ous action; or, third, was neither. the problem, which is frivolous law- fendant shall be issued in writing not later If the parties in the face of that de- suits that do not advance the cause of than 10 days after the end of the early eval- termination proceed with litigation, at uation procedure and provided to the parties. justice that have the economic adverse The evaluation shall not be admissible in the the conclusion of the litigation, that effects that are recited by the pro- action, and shall not be provided to the court report is submitted to the judge. And ponents of S. 240. until a motion for sanctions under paragraph in the case under the 1934 act, for in- So, Madam President, I will reserve (5) is timely filed. stance, where the report has found that the remainder of my time. But I urge a June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9153 favorable consideration of this amend- charges of fraud against those who make should not be forced to mediate claims ment by my colleagues. false projections of a company’s likely per- if they really want to seek a day in Thank you. formance. By granting ‘‘safe harbor’’ to all court. statements of a ‘‘forward-looking’’ nature, it EXHIBIT 1 essentially tells companies and brokers: Go This is the balance that was reached. Who Profits? ‘‘A Coterie of Lawyers’’— ahead, lie about the future. As long as you’re This Senator has never attempted to Rocky Mountain News. not misrepresenting the past, you can fleece keep people from having their day in Specialized securities lawyers win big investors in any way that your imagination court. This Senator stated that belief bucks by filing meritless lawsuits against allows. clearly for the record during debate on many of America’s most promising compa- Technically, investors still could sue in this provision and the loser pays provi- nies. The securities lawyers profit hand- cases of egregious deceit. But they’d have somely, but Americans with money in sion when they were strongly urged by only one year to do so, and they’d have to those in the private sector who sought stocks, pensions and mutual funds are the show evidence, up front, that the fraud was losers in the deal. deliberate. Not even the Securities and Ex- relief. But I would not, and could not, This is what editorial writers across the change Commission can prove willfulness support the losers-pays concept be- nation are saying about securities lawsuit that quickly. cause, as laudable as that might sound, abuse: The problem is that companies make plen- it would indeed infringe upon the basic ‘‘The situation now is that all investors ty of rosy projections in good faith. Some- rights of men to seek relief. It would are paying the costs of settling lawsuits that times, when the promises don’t pan out, frus- just be too high a bar for those who should never have been filed. . . . [T]he time trated (or merely opportunistic) investors have truly been aggrieved. has come to pull the legal leeches off the try to sue. How common is that? Experts dis- backs of corporations that have done no agree. This amendment requires parties to wrong.’’—Tampa Tribune, June 25, 1995. But the Senate bill offers a curious solu- submit to an early dispute resolution. ‘‘. . . the nogoodniks suffer at the same tion: To prevent some unknown number of If one of the parties, however, does not rate as the straight-shooters. Meanwhile, unfair securities-fraud lawsuits, let’s outlaw want this early procedure, then we who profits? A coterie of lawyers with stock huge categories of them. The genuine, fair ones have a very real problem. The early charts and fill-in-the blanks fraud com- will just have to go unpunished. evaluation procedure would take place plaints.’’—Rocky Mountain News, January So sorry you’re swindled, old chap. Better if each side agrees to it, or if either 18, 1995. luck next time. ‘‘. . . groundless lawsuits by shareholders This is licensed larceny, and it’s uncon- side wants it and the court acts upon alleging fraud . . . are often merely a way of scionable. Yet Florida Sen. Connie Mack, a such motion within 60 days of the filing extorting settlements from corporations member of the Banking Committee, has co- the class action. I believe that this whose stock prices have dropped.’’—Chicago sponsored and voted for the bill so far. In the amendment goes too far in its attempt Tribune, March 29, 1995. time since the committee review, Mr. Mack to resolve disputes. It actually sets up ‘‘Enactment of either [the House or Sen- may have had a chance to ponder its ill con- a standard where people would lose the ate] bill would remove a serious blot on the sequences. He’d do well to vote No today and ability to fight for their rights, wheth- legal system, which is supposed to settle real help slay this beast for good. disputes, not provide a protection racket for Recent history is replete with colorful il- er they are the plaintiff or the defend- a few lawyers.’’—Boston Sunday Herald, lustrations of deliberate, systematic fraud ant. I notice that Senator DODD is here June 18, 1995. on small investors. Their savings were re- and know that he has spent a great ‘‘These frivolous lawsuits discredit the plenished, if at all, only by the courts or by deal of time on this issue. legal profession, distract companies from the threat of litigation. It’s a strange mo- I yield the floor. their main tasks, discourage or retard the ment indeed, with the sores of the savings- Mr. DODD addressed the Chair. development of new, cutting edge businesses and-loan fiasco still raw, for Congress essen- and ultimately harm the interests of share- tially to declare open season for deceiving The PRESIDING OFFICER. The Sen- holders.’’—The Hartford Courant, April 11, investors. ator from Connecticut. 1994. It prompts an ironic question: How does it Mr. DODD. Madam President, let me ‘‘The contemporary class action has cre- help American investment to scare off poten- first of all thank my colleague from ated a class of entrepreneurial lawyers. The tial investors with a promise that the law Florida for giving me a call earlier first beagle to the court house with a tame won’t aid them if they’re bilked? The point of today about what he was going to offer plaintiff in tow often gets to represent the solving the ‘‘frivolous lawsuit’’ problem was with this amendment. class, and collect a 33%–50% fee. . . Then the supposed to be to encourage more invest- members of the class receive small com- ment. By that standard, the Senate’s ‘‘Pri- Let me first of all, say that the spirit pensation . . .’’—Barron’s, June 5, 1995. vate Securities Litigation Reform Act’’ of this amendment, which I admit I ‘‘The chief target of the reform legislation amounts to self-strangulation. like, in a way, has been offered as a is a small group of lawyers who have made a Mr. D’AMATO addressed the Chair. part of the original bill alternative dis- venal industry of filing groundless securi- The PRESIDING OFFICER. The Sen- pute resolution procedure to try to ties-fraud lawsuits. . . ator from New York. give litigants in securities matters an ‘‘. . . the securities bill [S. 240] would go a option of going a route rather than long way toward curbing egregious abuse of Mr. D’AMATO. Madam President, the the legal system. Such abuse is in effect a distinguished Senator from Florida is going into court to resolve their prob- hidden tax that costs American jobs and dis- correct that the amendment he is now lems. We tried that on a number of courages the entrepreneurial risk-taking submitting has been the subject of in- bills. I go back 7 or 8 years ago in my that stimulates economic growth.’’—The tense scrutiny. Indeed, it was consid- efforts with then Senator Danforth of News Tribune (Tacoma, Washington), June ered in the initial draft of this legisla- Missouri. We proposed some tort re- 10, 1995. tion. One of the reasons this proposal form legislation that set up an alter- Legislation introduced in the Senate (S. was rejected and dropped from the ini- native dispute resolution mechanism. 240) by Republican Pete Domenici and Demo- So there is a spirit to this amend- crat Chris Dodd will give control back to tial legislation was because it re- shareholders and really protect investors. quires—and will wind up costing—too ment and I am attracted to that spirit. much. Also, this provision would set up I say that at the outset. But let me EXHIBIT 2 an entirely new bureaucracy, by set- also say that despite my attraction [From the Miami Herald] ting up an early evaluation procedure with the spirit of what is being offered, LICENSE TO STEAL for class action lawsuits. I see this as being a proposal which is Practically everyone in Washington, to Although early evaluation may be a going to complicate matters rather some degree or other, has blamed ‘‘frivolous laudable concept, this amendment will than help resolve them. or abusive lawsuits’’ for sapping America’s force parties into an early evaluation Under this amendment, as I under- economic vigor. And judging from anecdotes, procedure. The procedure requires par- stand it, any party that seeks a court the complaint has some merit. But more ties to voluntarily turn over docu- order or an early evaluation—and if the often than not, the proposed cures turn out ments or be subject to sanctions. At court grants that order—an early eval- to be far more debilitating than the disease. the end of the evaluation, if the parties uation might sound, and does sound A perfect illustration is a bill moving do not settle or dismiss the action, very attractive, to Federal judges who through Congress that supposedly protects the securities industry from ‘‘frivolous’’ they can be sanctioned if any further are looking for a way to clear off their suits by investors. action is considered frivolous. I believe dockets, then you have the fishing The bill may come to a Senate vote today. that parties should attempt to mediate process which can begin which I think It would bar, among many other things, their claims, if possible, but they runs counter to what we are trying to S 9154 CONGRESSIONAL RECORD — SENATE June 27, 1995 achieve even under an alternative dis- The legislative clerk proceeded to As I understand the Senator’s amend- pute resolution, a modest one as we call the roll. ment, it is not subject to that criti- have in the bill. Mr. GRAHAM. Madam President, I cism. This is the frivolous suit only. Even if the complaint, Madam Presi- ask unanimous consent that the order Mr. GRAHAM. The purpose, I say to dent, is clearly a matter—let us for the for the quorum call be rescinded. the Senator, is the difference between sake of argument assume that is the The PRESIDING OFFICER. Without using a laser beam to precisely remove case—which would be dismissed and objection, it is so ordered. a tumor as opposed to amputation to the case ended, when a motion to dis- Mr. GRAHAM. I ask unanimous con- remove the entire limb. I fear that miss is decided, the plaintiff would get sent that the quorum call time be what we have done in this legislation, complete discovery prior to any ruling taken equally off both sides. Madam President, is to amputate the on the motion to dismiss. Now, that The PRESIDING OFFICER. Without ability of most investors to bring a se- raises the issue of discovery and dis- objection, the time will be applied rious case of securities fraud. Whether covery costs. Of course, these are some equally. it is frivolous, competitive, or highly of the principal forces and factors that Mr. D’AMATO addressed the Chair. meritorious, we have eliminated for cause innocent defendants to settle The PRESIDING OFFICER. The Sen- many individuals the ability to have their cases. ator from New York. access to court, to have their claims In testimony before our committee, Mr. D’AMATO. I suggest the absence adjudicated in all types of cases. in hearings on this matter—and I am of a quorum. The purpose of this amendment was quoting from page 14 of our committee Mr. SARBANES. Will the Senator to be that laser that would identify report: withhold on that? those cases which in fact are, to use . . .discovery costs account for roughly 80 The PRESIDING OFFICER. The Sen- the amendment’s term, clearly frivo- percent of the total litigation costs in secu- ator from Maryland. lous actions, and to provide some very rities fraud cases. Mr. SARBANES. How much time re- stiff sanctions against persons who are In many cases the discovery can mains? found to have filed a clearly frivolous work in determining the guilt of a The PRESIDING OFFICER. The Sen- action but persist. If they lose that 1 party. So I am not arguing there ator from Florida has 14 ⁄2 minutes; the clearly frivolous action, which should not be discovery, but here you Senator from New York has 22 minutes assumedly they are likely to do, then are getting it completely even before and 32 seconds. they face the prospect of paying not you get to the process, even before the Mr. SARBANES. I thank the Chair. only their attorneys and their costs; Will the Senator from Florida give motion to dismiss. they have to pay the defendant’s attor- me just 2 minutes? One witness described the broad dis- neys and costs. Mr. GRAHAM. The Senator from covery requests requiring a company to Conversely, if a clearly meritorious produce over 1,500 boxes of documents Florida yields such time as the Senator from Maryland would choose to use. action is filed and the defendant per- at an expense of $1.4 million, referring sists in litigation to defend against to page 16 of our report. The PRESIDING OFFICER. The Sen- ator from Maryland. that clearly meritorious action and the What does all this mean, Madam defendant loses, then the defendant is President? Lawyers who can file Mr. SARBANES. Madam President, I wish to say to the Senator from Flor- placed in the position of being subject meritless cases—and we have seen ex- to the sanction of having to pay not amples of that, cases that would be dis- ida that I think he has come up with a very imaginative proposal here. His only his own costs but also the costs of missed by the Court—will be able to the plaintiff. circumvent the very important protec- proposal in fact really gets at the ques- This is not an attempt to apply a tion against unjustified claims that is tion of the frivolous suits. We have broadly based English standard of loser provided by the motion to dismiss been hearing a lot of discussion here pays. This is an attempt to achieve the process. over the last couple of days about try- very purpose of this legislation, which Indeed, this amendment would ex- ing to get at frivolous suits. is to discourage frivolous lawsuits by pand attorneys’ ability to coerce set- When you look at the provisions that making the economic consequences of tlements, in my view to include a new are being used in order to get at frivo- filing a frivolous lawsuit so onerous. category of cases—those that are by lous suits, you discover that they real- definition meritless and that would be ly encompass a great number of other I thank my colleague for having dismissed by the court. Given all the things as well. As my colleague from asked that clarifying question. evidence that these lawyers extract in Nevada, Senator BRYAN, said at one Mr. SARBANES. As I understand it, settlements in unjustified cases, we point during the debate, this is a Tro- the amendment of the Senator is bal- cannot—in my view, should not—enact jan horse riding beneath the pennant of anced. There has been a tremendous a provision that would expand their the frivolous suit with all sorts of amount of focus about the frivolous power to do so in meritless cases, and other menacing, dangerous things hid- lawsuit filed by plaintiffs, but there that would be the net effect were the den in the Trojan horse. also can be a problem with defendants amendment to be adopted. I am interested that the proponents resisting what are otherwise meritori- So again, for one who is attracted of this legislation are not responsive to ous claims. Is that not correct? How very strongly to the alternative dis- the amendment of the Senator, which, does the Senator address that? pute resolution process, what you are of all the proposals I have seen, is the Mr. GRAHAM. Yes, Madam Presi- getting here is something very dif- one that focuses on the frivolous suit dent, there could be a frivolous defense ferent than that which raises the costs and on the frivolous suit only, as I un- as well as there can be a frivolous which provokes these kinds of settle- derstand it. plaintiff’s filing. And this amendment ments in meritless cases, and there- I ask the Senator, is it, in fact, cor- would provide balance. Exactly the fore, with all due respect to my good rect that the focus of the Senator’s same sanctions would be applied under friend from Florida, I would urge the amendment is the frivolous suit and it the 1934 Securities Act to a frivolous rejection of this amendment. does not go beyond that? action as would be applied to a clearly The PRESIDING OFFICER. Who We have other things that are being meritorious action. That is, if you are yields time? done. People are being denied access to the defendant, and the evaluation is Mr. D’AMATO. Madam President, we the courthouse. Aiders and abettors are this is a clearly meritorious case, but have nothing further to say on this being protected from any liability you persist, litigate, and you lose, then side, unless the Senator from Florida whatsoever. Joint and several liability you are subject to the sanction of hav- wishes to continue. Otherwise, we will is being done away with, all in the ing to pay the plaintiff’s attorneys fees put in a quorum call. name of trying to get at the frivolous and court costs. So this is an attempt Mr. GRAHAM. Madam President, I suit. It may have some implications for to create some strong economic incen- suggest the absence of a quorum. the frivolous suit, but the unfortunate tives for people to settle and for people The PRESIDING OFFICER. The thing is it also has very significant im- not to file a frivolous action, nor to clerk will call the roll. plications for the meritorious suit. persist in frivolous defenses. June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9155 Mr. SARBANES. I have to say to the Mr. GRAHAM. Madam President, un- serve ourselves 2 minutes for tomor- Senator, having listened to this expla- less there is someone else who would row, and as much time as we need this nation, I have difficulty understanding like to speak on this amendment, I am evening. I do not intend to use more why the proponents of this legislation prepared to make a short concluding than 15 minutes at the most. have asserted that the purpose in try- statement and then if the opponents Mrs. BOXER. Reserving the right to ing to move the legislation is to avoid are prepared to yield back their time, I object, and I do not want to object, expensive litigation or preparation for would be so prepared and we could pro- when are we going to vote on the Gra- litigation. ceed. ham amendment? Let me ask the Senator one final Madam President, we have before us Mr. D’AMATO. It is my thought and question. Does your process come in consensus on one issue, and that is that intent that we will vote on Senator ahead of an extensive discovery period, there is a problem relative to frivolous GRAHAM’s amendment after your or how does it work? At what point lawsuits in the securities area. The amendment. And Senator SPECTER has does your process come into play? quandary is how to eradicate or miti- several amendments to offer. If we Mr. GRAHAM. The expectation gate that problem without doing exces- could stack them to accommodate would be that this would be at the dis- sive damage to other rights of inves- some of our colleagues, certainly well cretion of the parties or of the judge tors, without eliminating what has before 9 o’clock. It is my intent to ask that this would be the first action ini- been one of the principal deterrents to for unanimous consent that we proceed tiated after the litigation has been fraudulent behavior within our free en- in that manner. filed. terprise system, what has been one of No matter, at least the Senator will Mr. SARBANES. I see. So it would the foundations of public confidence have the opportunity of offering her involve potentially a lot of the costs that they could invest in our capitalis- amendment and starting to use some of that are associated with preparing for tic system and be treated fairly. her time. (Mr. BURNS assumed the chair.) trial, let alone the costs connected I believe this amendment goes di- Mrs. BOXER. I say to my friend, I am with the trial? rectly at the problem that we have Mr. GRAHAM. That is correct. very willing. I would prefer to have my identified. It states that early on, after Mr. SARBANES. It is difficult for me vote follow Senator GRAHAM’s. I think to understand the people who are op- a case has been filed, there will be an it makes more sense. posing this amendment on the asser- independent evaluation by a judicially Mr. D’AMATO. Would you like to tion they are trying to get at the cost selected mediator as to whether this is vote on it this evening? of frivolous suits, or as I understand it, a frivolous, meritorious, or other ac- Mrs. BOXER. I am suggesting tomor- opposing the Senator’s amendment. I tion. The case would then be in the row morning. just have difficulty squaring that. hands of the litigants as to whether, in Mr. D’AMATO. We will vote on Sen- Mr. GRAHAM. It seems to me, the face of that determination, they ator GRAHAM’s amendment this Madam President, that this amend- wish to proceed. evening. ment is exactly consistent with what But if they proceeded with a frivo- Mrs. BOXER. I was not aware of that. proponents of this legislation say the lous case, and if they lost that frivo- Mr. D’AMATO. That was my purpose, evil is that we are attempting to cor- lous case, then they would be subject so you would have an opportunity. rect, and it would avoid the necessity to very serious sanctions of having to Mr. SARBANES. If the manager will of having to overreach in terms of a pay not only their bills, but also the yield, as I understand the procedure remedy to apply an excessive amount attorney fees and costs of their oppo- now, the Graham amendment is being of medication of severely restricting nent. I think that would be a signifi- set aside so Senator BOXER can offer access to courts by people with legiti- cant factor in terms of deterring the her amendment? mate claims, which I fear this legisla- prosecution of frivolous suits. Mr. D’AMATO. That is correct. Pos- tion will do. And even if a legitimate Frivolous defenses are sanctioned in sibly Senator SPECTER, as well. claim matures into a judgment, to then exactly the same manner. So if a case Mr. SARBANES. Senator BOXER’s protect those persons against whom is determined to be clearly meritori- amendment we will debate for 40 min- the judgment might be rendered by ous, and yet the defendant proceeds utes. You will respond for, I think, not things like the aiders and abettors pro- and loses, that defendant will be sub- more than—— Mr. D’AMATO. Not more than 15 vision and the joint and several liabil- ject to these sanctions. Madam Presi- minutes. ity, particularly as it relates to small dent, I believe that comes as close to Mr. SARBANES. Then we will move investors, et cetera. All of those types solving the problem we have identified on to some other amendments? of things would be less necessary if we and does so in a way that does not have unintended, adverse consequences on Mr. D’AMATO. It is my hope we went straight at the problem cited, the would take the three Specter amend- frivolous lawsuit, and tried to elimi- other aspects of investors’ rights. So I urge those who are proponents of ments, at least two of those amend- nate as many of those lawsuits by ef- ments, and dispose of them this fective sanctions as I believe this will S. 240 to see this as a supportive, friendly, positive contribution to evening, as well. be at the initial stages. Mr. SARBANES. The Boxer amend- achieve their objective. And I hope Mr. SARBANES. Then you would not ment would go on over to the morning. be running the risk, the very substan- that they and my other colleagues will Senator BOXER will have an oppor- tial risk, as I perceive this legislation, support this amendment, which I be- tunity to speak in the morning for 5 that meritorious claims would be ad- lieve moves toward achieving the very minutes. purpose that led to the introduction of versely affected by these other sweep- Mr. D’AMATO. That is correct. ing provisions that are in this legisla- this legislation in the first instance. Mr. SARBANES. We intend to vote Thank you, Madam President. tion. Your provision by definition is so tonight on Senator GRAHAM and Sen- I yield the floor, and I am prepared to directed that the meritorious claim ator SPECTER? would pass through the screening proc- yield back the balance of my time. Mr. D’AMATO. That is correct. ess, as I understand it? Mr. D’AMATO. Madam President, I Mr. SARBANES. All together, or Mr. GRAHAM. The early evaluation want to thank the Senator from Flor- Senator GRAHAM after Senator BOXER would make a determination that the ida. I too yield back the balance of our finishes her debate? case was either clearly frivolous, clear- time, and ask unanimous consent that Mr. D’AMATO. Well, I would like to ly meritorious, or neither. And if you this matter be set over for the purpose possibly stack them for the conven- fell into that third category, then that of giving Senator BOXER an oppor- ience of our Members so they do not ought to be the kind of open, civil due tunity to offer her amendment. She has have to keep coming back and forth process that we associate with the indicated that she would take 40 min- this evening. American judicial system. utes on her side and retain the balance Mr. SARBANES. This evening. Mr. SARBANES. Well, I thank the of 5 minutes for tomorrow with the ex- Mr. D’AMATO. This evening. Senator very much for his explanation press intent that we will vote on her Mr. SARBANES. So it would be the and for his very constructive and I amendment first tomorrow after she Graham amendment and Specter, some think imaginative proposal. makes her 5-minute statement. I re- number of Specter. S 9156 CONGRESSIONAL RECORD — SENATE June 27, 1995 Mr. D’AMATO. That is correct, ei- ‘‘(A) purchased or sold a material amount statements made in connection with ther two or three. of the equity securities of the issuer (or de- insider trades. Why is that? Because Mr. GRAHAM addressed the Chair. rivatives thereof), as reflected in filings with small investors believe the statement. the Commission; and The PRESIDING OFFICER. The Sen- ‘‘(B) financially benefited from the for- Buy the stock, push up the price, the ator from Florida. ward-looking statement. insider then sells his stock at the high- Mr. GRAHAM. Mr. President, at the ‘‘(2) DEFINITION.—For purposes of this sub- er price, pockets the profit, because of appropriate time, and if that appro- section, the term ‘material amount’ means— a false and misleading statement. The priate time is now, I would like to ask ‘‘(A) with respect to an issuer, $1,000,000 stock collapses. When the true news for the yeas and nays on my amend- worth of any class of the equity securities of hits, the small investors are left hold- ment. the issuer; and ‘‘(B) with respect to an officer or director ing losses. The PRESIDING OFFICER. Is there a of an issuer, $50,000 worth of the holdings of I am going to show a chart which I sufficient second? that person of any class of the equity securi- showed last week, the Crazy Eddie There is a sufficient second. ties of the issuer.’’. story. Crazy Eddie was a business. This The yeas and nays were ordered. Amend the table of contents accordingly. is real. This is not a figment of any- The PRESIDING OFFICER. Is there Mrs. BOXER. Mr. President, simply one’s imagination. Let us hear what objection? Without objection, it is so put, my amendment says that insider Crazy Eddie said. This is a forward- ordered. The Senator from California is traders who financially benefit from looking statement: recognized. false or misleading forward-looking ‘‘We are confident that our market AMENDMENT NO. 1480 statements shall not benefit from the penetration can grow appreciably.’’ (Purpose: To make an amendment relating safe harbor in S. 240. It could not be ‘‘Growing evidence of consumer ac- to the consequences of insider trading) more direct. I am very hopeful col- ceptance of the Crazy Eddie name Mrs. BOXER. I yield myself 30 min- leagues will support me on this. augurs well for continuing growth out- utes at this time. It is very clear that 48 colleagues are side of New York.’’ Mr. President, I send an amendment unhappy with the safe harbor as it is in Crazy Eddie dumps his stock, the top to the desk, and I ask for its immediate S. 240. All we are doing here is saying, officer flees the country with millions, consideration. ‘‘Well, you didn’t change it, so at least the CEO is convicted of fraud, and to The PRESIDING OFFICER. The let us not allow insiders who finan- any of my colleagues who say there is clerk will report. cially benefit in connection with a another provision that covers insider The bill clerk read as follows: false and misleading statement they trading, that is only for the stockhold- ers who actually bought Crazy Eddie’s The Senator from California [Mrs. BOXER] issue to get the benefit of the safe har- proposes an amendment numbered 1480. bor.’’ stock. It does not cover the class of other people who suffer because the Mrs. BOXER. Mr. President, I ask S. 240 has a safe harbor provision stock plummeted. I think that is an unanimous consent that the reading of which basically gives insiders huge pro- important point, because every time I the amendment be dispensed with. tection for false forward-looking state- The PRESIDING OFFICER. Without ments, all statements, except those in- raise an amendment, the opposition objection, it is so ordered. volving intentional fraud. In other stands up and says this is covered in The amendment is as follows: words, there is a safe harbor for reck- another section. Wrong. Not for the less fraud, knowing fraud and purpose- class of shareholders, only the ones At the appropriate place in title I, insert who buy Crazy Eddie’s stock. the following new section: ful fraud. Let me repeat that. The S. 240 safe harbor provision, which gives If he sells a million dollars worth of SEC. . CONSEQUENCES OF INSIDER TRADING. stock, those people who bought it, yes, (a) SECURITIES ACT OF 1933.—Section 13A of insiders immunity for false forward- the Securities Act of 1933, as added by sec- looking statements, involves reckless they can pursue under another provi- tion 105 of this Act, is amended by adding at fraud, knowing fraud and purposeful sion of law. The other $2 million worth the end the following new subsection: fraud. of stock bought by the general public ‘‘(h) CONSEQUENCES OF INSIDER TRADING.— Senator SARBANES tried to change have very little chance here. ‘‘(1) IN GENERAL.—Notwithstanding sub- that standard. He offered two amend- Let us go to the next chart. section (c), the exclusion from liability pro- ments. Those two amendments failed, T2 Medical, Inc. Here is another busi- vided for in subsection (a) does not apply to although I would say the second one ness. Take a look at this one’s forward- a false or misleading forward-looking state- looking statements. My colleagues ment if, in connection with the false or mis- got 48 votes from both sides of the leading forward-looking statement, the is- aisle. Obviously, people are troubled by want to encourage forward-looking suer or any officer or director of the issuer— the safe harbor which my friend from statements. So do I, but not false ones. ‘‘(A) purchased or sold a material amount Maryland calls a pirate’s cove. I call it I want to encourage honest ones. Does of the equity securities of the issuer (or de- a deep ocean—a deep ocean. that mean that some businesses may rivatives thereof), as reflected in filings with In the Boxer amendment, the insider make a mistake? They may make a the Commission; and trading has to appear on the records of mistake, a true mistake. But look at ‘‘(B) financially benefited from the for- the SEC, so it is no guesswork. You these guys: ward-looking statement. know that insider made his insider ‘‘T2 plans to lead the way through ‘‘(2) DEFINITION.—For purposes of this sub- section, the term ‘material amount’ means— trades because it is registered with the the 1990’s.’’ ‘‘(A) with respect to an issuer, equity secu- SEC, and it would have to involve sig- ‘‘We expect continued steady revenue rities of the issuer of any class having a nificant insiders—the company itself or and earnings growth.’’ total value of not less than $1,000,000; and its officers or directors. So it is very Just at the time of those statements, ‘‘(B) with respect to an officer or director narrowly drawn. look what happens: The stock goes up; of an issuer, holdings of that officer or direc- Under my amendment, the insider insiders sell 571,000 shares for 31 mil- tor of any class of the equity securities of trading would have to involve signifi- lion bucks; the Wall Street Journal re- the issuer having a total value of not less cant sums; in the case of a company, a ports insurers reducing their payments than $50,000.’’. by 15 to 50 percent; the stock plunges; (b) SECURITIES EXCHANGE ACT OF 1934.— million dollars in insider trading or Section 37 of the Securities Exchange Act of more; in the case of an officer or direc- then the company discloses a grand 1934, as added by section 105 of this Act, is tor, insider trading would have to in- jury investigation; total insider sales amended by adding at the end the following volve $50,000 or more. of $31.6 million. new subsection: Let us be clear, the Boxer amend- And look at the story here. Now the ‘‘(h) CONSEQUENCES OF INSIDER TRADING.— ment only covers those trading on in- people at T2 Medical would get the safe ‘‘(1) CONSEQUENCES OF INSIDER TRADING.— side information who also issue false harbor for forward-looking statements, Notwithstanding subsection (c), the exclu- forward-looking statements in connec- the very same safe harbor that Senator sion from liability provided for in subsection SARBANES tried to tighten up. They (a) does not apply to a false or misleading tion with that insider trading and who forward-looking statement if, in connection financially benefit from that trading. would get the protection of that safe with the false or misleading forward-looking Make no mistake, unsuspecting in- harbor. statement, the issuer or any officer or direc- vestors are harmed quite directly by It is an invitation to fraud. It is ex- tor of the issuer— false or misleading forward-looking actly what Chairman Levitt of the SEC June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9157 said would happen. He does not like the crooks. They do not want to make it safe harbor provision goes forward, and safe harbor. He said if you do this, by harder to catch them. we do not at least take this Boxer God, you crook, you cannot hide under I will put all of these in the RECORD amendment, when we have the first cri- that safe harbor. I hope my colleagues at the appropriate time. sis in the marketplace, when a group of will embrace this amendment. Now, here is a quote from Gene investors like those burned by Keating Look at this, it tells the story, I say Marcial, a Business Week ‘‘Inside Wall or any of the others, when they come to my friend. The statement is made: Street’’ columnist. This is his book. to Washington and stand on the steps ‘‘T2 plans to lead the way through Don’t kid yourself: Very little has changed of the Capitol and say, ‘‘What have you the 1990’s.’’ on Wall Street. Half a dozen years after the done? You are giving these people a ‘‘We expect continued steady revenue scandals of the 1980’s, when any number of safe harbor. Where is my safe harbor? and earnings growth.’’ street veterans were charged with violations Why can I not collect from these The stock goes up, insiders sell, and of securities laws and several high profile in- crooks?’’ You know, that is when con- siders were marched off to jail, insider trad- the truth comes out. They disclose the ing and market manipulation—in most cases fidence in the investing public will grand jury investigation and bye, bye, illegal—are still the most zealously desired plummet. baby, for all those poor snooks who play in the financial world. I tell you, with what I know about bought it. He concludes and basically says, this bill—and my colleague said some This individual and these insiders do ‘‘Sorry, but that’s the way the game is claims would work. I worked on Wall not deserve the safe harbor in S. 240. If played.’’ Street at Hemphill, Noyes, & Co., Senator SARBANES had been successful Now, look, if the game is played that Zuckerman & Smith, and J.R. at changing the safe harbor, I would way, we should try to stop it. We Williston & Beane. I was proud of those feel a lot better and I would not have should not make it easier. days. I was one of the few women who offered this amendment. I told that to Let us go to the next chart. Here is had the license, passed the exam, was a my friend. But we have the pirate’s another one. New York Times, June registered representative. I had a very cove. Here are the pirates—Crazy Eddie 1995. small—but important to me—practice. You can call it a practice. I had clients. and these people. These are just two Regulatory Alarms Ring on Wall Street. examples. And for those who said With the frenzy of merger deals and takeover They trusted me, and I will tell you, if Charles Keating never made forward- battles these days, it seems like old times on I was in that business today, honestly looking statements, I have a chart on Wall Street in more ways than one. Securi- knowing what I know about this bill that, too. So Crazy Eddie’s top officer ties regulators say they are opening inves- and the fact that we did not pass the fled the country. The CEO was con- tigations into insider trading at a rate not amendment offered by my friend from victed of fraud. Investors were left with seen since the mid-1980’s, the era in which Maryland, I would really tell people to huge losses. That is the type of mis- Ivan Boesky, who went to jail for trading on be very wary and to be very careful. I inside information, became a household really would. behavior this bill would encourage and name. reward. Why? It is not that anybody The small investor, the IRA owner, They go on to say that it is a growth who writes this bill wants to help guys the 401(k) owner, is increasingly com- industry. We are going to give insider like this. But as a result of the safe ing to believe there are two games in traders a safe harbor. They do not de- harbor, these guys get the benefits. We town, two securities markets, one for serve it. I am worried about the good say that they should not. the insiders and one for the little in- business people. I represent a lot of Now, I do not think we want to en- vestors. The small investor is increas- them and I am proud of them. They courage this. These are not isolated ex- ingly coming to fear that little inves- would not cheat anyone. They deserve amples. There is a great deal of insider tors are being played for suckers. Gary to be supported, and they do not de- trading. Am I picking out two exam- Lynch, who oversaw the Securities and serve frivolous lawsuits. This is about ples because I am exaggerating here? Exchange Commission’s investigation the bad guys. No; let me show you where we are with of Ivan Boesky, Dennis Levine, and Mi- So let us, in good faith, say we did insider trading. This is a story from chael Milken is quoted as saying, not change the safe harbor, but let us Business Week, December 1994. ‘‘Insider ‘‘What is happening now is exactly make sure that the worst of the worst, Trading: It’s Back, But With a New what everyone predicted in the 1980’s, these inside players who issue a false Cast of Characters.’’ They looked at 100 that as memories dulled, insider trad- or misleading statement and then sell of the largest businesses, by the way, ing would pick up again. The tempta- their stock and benefit, do not get the and found that one out of every three tion would be too great.’’ benefit of the safe harbor. merger deals was proceeded by stock That is what this bill does—tempta- I say, if we do not do this, the incen- price runups. tion in the form of a safe harbor, which tives for insider trading and cashing in Here is one from the Los Angeles my friend from Maryland calls the pi- will be greater because, clearly, there Times. I want to say to my friends that rate’s cove and I call an ocean. Insiders is a nice, safe harbor for these people this is a story from Saturday, June 24, could well have a field day if this bill to hide in. I hope anyone who supports 1995. I opened the paper when I was in passes in its current form. this bill would not want to encourage L.A., and there it was. ‘‘Insider Trading I talked about the loss of faith that insider trading. Probes Make a Comeback. Wall Street. people would feel, and I say that very Again, my amendment focuses nar- SEC official notes more investigations seriously. We may not see securities rowly on only one type of notorious than at any time since the takeover markets as we know them today. They fraud, insider trading in conjunction boom of the 1980’s.’’ may not be the envy of the world, the with false or misleading forward-look- What are we doing? We are giving engine of economic opportunity for or- ing statements, and they have to in- these people a safe harbor. I do not dinary Americans, because they will be crease the insider trader’s profit. That think this is in the best interest of the rigged against the honest investor, who is the only way they do not get the safe country. How about reading this a lit- will stay out of the securities market- harbor. It has to be a false or mislead- tle bit: place. ing statement made in conjunction Now the bill supporters want to stop A wave of mergers and acquisitions in the with their sale, and they have to make strike suits. So do I. They want to stop United States is reviving an unwanted head- a profit. So we are not opening up a ache for regulators: Insider trading. frivolous lawsuits. So do I. I have to ‘‘We have more insider trading investiga- loophole for anybody good. We are clos- say, I do not think anyone that backs tions now than at any time since the take- ing a loophole for the bad. And that is S. 240 wants to help insiders who would over boom of the 1980’s,’’ said Thomas very clear. issue a false and misleading statement, Newkirk, associate director of enforcement My friend from Connecticut—and he and pocket the stock. I know they do for the Securities and Exchange Commis- is my friend and we go back and forth not. sion. on this bill—has said many times that I hope they look at this legislation No wonder the SEC has trouble with confidence of the investors is the most with an open mind. I think it is very the safe harbor in this bill. These are important thing. I have news. You just narrowly focused. It is crafted for the the guys who have to go after these wait. If we do not fix this bill and this sole purpose of making sure the bill S 9158 CONGRESSIONAL RECORD — SENATE June 27, 1995 does not shield and encourage insider ment at the Securities and Exchange Com- tion. Regulators contend that he bought trading. I think it is quite clear. mission.‘‘In terms of raw numbers, we have shares of Tele-Communications Inc., the big Let me say I do have a Charles as many cases as we’ve had since the 1980’s, cable operator, in advance of the announce- Keating chart, and I want to just say when we were in the heyday of mergers and ment that it planned to merge with Bell At- acquisition activity.’’ lantic. The S.E.C. is looking at Mr. Moran’s some of the things that Charles Through the end of May, the National As- purchases because his son is a securities ana- Keating said in terms of his forward sociation of Securities Dealers, which over- lyst who was privy to information about the looking statements: ‘‘Future prospects seas the Nasdaq electronic trading market, pending deal. Mr. Moran has said he will are outstanding.’’ That’s what he said. had already referred 47 cases to the S.E.C. fight the charges. He tried to get people to buy the junk for investigation into possible insider trad- Despite the higher numbers, regulators un- bonds. He said, ‘‘We offer significant ing, said James Cangiano, N.A.S.D.’s senior doubtedly miss cases both big and small. But, in this newest round of insider trading profit potential over the next 5 years.’’ vice president for surveillance. If the pace of suspect trading continues at that rate, it investigations, it appears that the chances of That is forward looking. ‘‘Completion would mean the N.A.S.D. would surpass the being caught are higher than before. At the and sale of projects will generate huge record 110 insider trading referrals it made New York Stock Exchange, 100 employees gains.’’ Thousands bought and lost to the S.E.C. in 1987, he added. work in market surveillance today, up from money. The same holds true for the New York 76 in 1975. And white-collar criminals who Senator BRYAN showed a chart. He Stock Exchange, where investigators have are members of the Big Board face stiffer showed what the impact would be if we opened three times as many insider trading fines if they get caught. In 1988, the New adopt S. 240 the way it came to the cases so far this year as they had by this York exchange removed the previous limit of date in 1994. $25,000 for each charge against a member, floor. It would hurt those people. The Lotus case seems typical. In the days eliminating any cap on potential fines. At I just want to say, and I will retain before the I.B.M. announcement, trading in the same time, Congress enacted the Insider the balance of my time, we are very both Lotus stock on Nasdaq and Lotus op- Trading Sanctions Act, which allows for tri- clear in what we are trying to do with tions, which are traded on the American ple damages to be paid when a trader is con- S. 240. We are trying to make it a bet- Stock Exchange, was unusually heavy. ‘‘I victed on insider charges. ter bill. think you can presume we are looking at it,’’ Moreover, the New York Stock Exchange Believe me, it would be easier for the Mr. Cangiano said. And while the S.E.C. does and the Chicago Board Options Exchange, ranking member and those members on not comment on pending investigations, which routinely share information with each other and with the S.E.C. about suspect ac- the committee who had trouble with Wall Street professionals say that the agen- cy has undoubtedly already opened a case to tion in the markets, have beefed up their de- this bill to fold up our tents, because in investigate Lotus trading. tection mechanisms substantially. this committee we could hardly get but These days, those trading on insider infor- ‘‘When I first came her in 1981, the analysts a couple of votes. mation apparently do not come as frequently drew genealogical trees of corporate officers We believed enough in these amend- from the ranks of Wall Street’s professionals and investment bankers and hung them on ments that we are offering that we de- as they did in the 1980’s, regulators say. the wall’’ to analyze who had privileged in- cided to take to the floor and try to ex- Those who take advantage of privileged in- formation about a pending deal, said Agnes Gautier, a vice president in the Big Board’s plain them to our colleagues. As others formation now tend to be corporate officers, directors, and their families, friends and market surveillance department. Today, by have said, it is difficult to do that. It is lovers, according to executives at the na- contrast, computer software programs spit a technical area of the law. tion’s stock exchanges, and lawyers who rep- out the dates, times and names behind the The bottom line is we do not want to resent defendants. trades that look suspicious, she said, making give the Crazy Eddies—those who But the game—and the potential profits— what used to be an onerous task a fairly sim- would make a false statement—a safe are the same: get information about a pro- ple exercise. harbor, and then turn around when posed deal that might raise the shares of a Thus, the S.E.C. was able to quickly inves- they make their money, the facts come publicly traded company before it is an- tigate and settle a case against a lawyer for Lockheed only eight months after the news out, the investors are left holding the nounced, and buy the stock ahead of the news. Better yet, buy the options, which cost that the military contractor and Martin bag. Why should those people get a safe less and tend to attract less regulatory scru- Marietta would merge. The lawyer made harbor, I say to my friends. tiny. $42,000 in illegal profits by buying Lockheed I hope you will endorse the Boxer Then, after the public learns what the in- options, Mr. McLucas recalled. amendment. siders knew ahead of time, it’s time to get Considering all this renewed attention to Mr. President, I ask unanimous con- out with a quick profit. insider trading, shouldn’t more people be wary of breaking the rules? ‘‘We’d like to sent to have printed in the RECORD a The lure of profits from insider informa- think so,’’ Ms. Gautier said. ‘‘But, I guess, as New York Times article and a Los An- tion regarding deals is just too much to re- sist for some players, the S.E.C.’s Mr. the defense lawyers say, ‘Greed will over- geles Times article. McLucas said. The potential rewards com- come.’ ’’ There being no objection, the articles pared with the risks look better ‘‘when peo- were ordered to be printed in the ple look at the premiums available in take- [From the Los Angeles Times, June 24, 1995] RECORD, as follows: overs,’’ he said. ‘‘We’re a few years removed INSIDER-TRADING PROBES MAKES A COMEBACK [From the New York Times, June 9, 1995] from the Boesky insider trading cases, and WALL STREET: SEC OFFICIAL NOTES MORE IN- people have short memories.’’ Of the 1,400 VESTIGATIONS THAN AT ANY TIME SINCE THE REGULATORY ALARMS RING ON WALL STREET unresolved cases in the S.E.C.’s current in- TAKEOVER BOOM OF THE 1980’S (By Susan Antilla) ventory, Mr. McLucas said, 20 percent in- NEW YORK.—A wave of mergers and acqui- With the frenzy of merger deals and take- volve insider trading. sitions in the United States is reviving an over battles these days, it seems like old The initial rounds of suspect trading of the unwanted headache for regulators: insider times on Wall Street in more ways than one. last year or so differed from those of the trading. Securities regulators say they are opening 1980’s in that they generally did not focus on ‘‘We have more insider-trading investiga- investigations into insider trading at a rate big names in the securities business. ‘‘While tions now than at any time since the take- not seen since the mid 1980’s, the era in Wall Street learned some lessons of the over boom in the 1980s,’’ said Thomas which Ivan Boesky, who went to jail for 1980’s, it’s not completely clear that Main Newkirk, associate director of enforcement trading on inside information, became a Street learned all of the lessons,’’ said Har- for the Securities and Exchange Commis- household name. vey Pitt, the former S.E.C. lawyer who de- sion. Regulatory alarm bells went off again ear- fended Mr. Boesky. Several of this year’s largest merger an- lier this week after I.B.M. disclosed its hos- If Wall Street appears to be more honest, nouncements have been preceded by unusual tile $60-a-share offer for the Lotus Develop- though, it is largely a function of increased trading Thursday, shares of Scott Paper Co. ment Corporation. That bid pushed up the surveillance by brokerage firms and by regu- jumped $2.50 to $46.875. Friday morning, the value of Lotus shares by 89 percent on Mon- lators, say defense lawyers and securities Wall Street Journal reported that Kimberly- day, the day it was announced, and caused cops. ‘‘We have not returned to the environ- Clark Corp. was negotiating to buy the com- regulators to begin looking into suspicious ment of the 1980’s where so many defendants pany. trading last week. were investment bankers, brokerage firm During the merger bonanza of the 1980s, in- Other cases brought to light recently in- employees and young lawyers,’’ Mr. McLucas sider trading was equated with greed on Wall volved Lockheed’s merger last year with said. Still, he added, ‘‘We’re seeing people in Street as prosecutors won convictions Martin Marietta, another military contrac- those areas start to crop up, and I wouldn’t against Ivan Boesky, Michael Milken and tor, and AT&T’s acquisition of the NCR Cor- be surprised to see more of them.’’ others. The alleged culprits of the 1990s tend poration. Earlier this week, Frederick A. Moran, a to be more ordinary working folk. ‘‘It’s a growth industry,’’ said William money manager in Greenwich, Conn., said In February, the SEC charged 17 people McLucas, director of the division of enforce- that he was the focus of an S.E.C. investiga- with civil violations of insider-trading laws June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9159 related to trading in shares of AT&T Corp. Mrs. BOXER. That is exactly right. The distinguished Senator from Cali- acquisition targets, including NCR Corp. and Mr. SARBANES. What happens fur- fornia put into the RECORD a long list McCaw Cellular Communications Inc. Two ther along there? They get news, then of organizations that had difficulty were former AT&T employees. Charles revealed, that the insurance for this with this legislation. We were sounding Brumfield, former vice president in the human resources department, pleaded guilty medical company is falling off, is that the warnings about this legislation. in connection with the case. it? The consumer groups all have joined in Earlier this month, the SEC sued a Mrs. BOXER. That is correct. The doing that. Salomon Bros. Inc. analyst, Frederick clients say they are reducing their pay- I hope, as Members approach the end Moran, and his father, a money manager in ments to the T2 Medical Inc. by 15 to 50 of the amendment process and consider Greenwich Conn., for alleged insider trading percent, and the company here dis- the bill itself, they will come to realize in the failed merger of Tele-Communications closes a grand jury investigation which that the burden of the consequences Inc., the nation’s largest cable systems oper- they knew. are going to fall on the supporters. If ator, and Bell Atlantic Corp. Mr. SARBANES. What happens fur- ‘‘We brought 45 cases in the last fiscal year this legislation passes, those voting to and the caseload is running about the same ther along? support it will bear the heavy burden this year,’’ the SEC’s Newkirk said. Mrs. BOXER. It goes on down list. in terms of what the consequences are Opportuunities are increasing for people to They have unloaded at this point, $31 going to be. use advance knowledge of a merger to make million or 571,000 shares of the stock at There is no doubt in my mind that illegal profits. About $178 billion in mergers the high price, and now as this bad honest people will end up being de- have been announced since the beginning of news comes out, we see the stock plum- frauded and not have a remedy as a the year, putting 1995 on course to exceed met, and essentially, the company here consequence of this legislation. The last year’s $368 billion, according to Securi- reports the SEC is investigating them. regulators have warned Members of ties Data Co. Regulators say they are looking at such That is as far as this chart goes. that fact. Groups that have no vested transactions for any sign of trading picking They are under investigation. These economic interest in this legislation up before the agreements were announced. were bad apples. People got snookered have warned Members of that fact. I That was the case for shares of Telular in as this stock went up, left holding just want to sound that warning to my Corp., which said June 22 that it might seek the bag as it goes down. Insiders knew colleagues. a buyer for the company, and for Lotus De- all of this. Mr. D’AMATO. Mr. President, first of velopment Corp., which agreed to be bought And we are saying they should not all, I want to thank the Senator from by International Business Machines Corps. have the ability to get the safe harbor. California for being so gracious and so On June 20, just before a New York state Mr. SARBANES. I want to commend agency proposed a buy-out of Long Island accommodating in attempting to go Lighting Co. for $17.50 a share, the utility’s the Senator for offering this amend- forward in a manner—and I know she stock jumped $1.50 to a seven-month high of ment, for her very clear explanation of was not feeling up to par. Although she $17. it. has made a brilliant case, and has pre- One person who isn’t surprised by the re- I want to underscore one other point sented her case with the eloquence of cent rise in insider-trading cases in Gary the Senator had which I think is ex- someone who believes in what they are Lynch, who as chief of enforcement at the tremely important. Members have saying, and she does believe very SEC during the 1980s was one of the main taken the floor in the sense of a con- strongly, I am forced to oppose this people responsible for bringing about the structive way, trying to propose and convictions of Boesky and Milken. amendment. ‘‘What’s happening now is exactly what ev- get adopted amendments which we Let me say, this is not easy to op- eryone predicted back in the ’80s: that with think should straighten out some of pose. Let me explain why I oppose this the number of high-profile cases brought, the the problems with this legislation. amendment, because this is a very incidence of insider trading would decline for In fact, I am prepared to say if all of complex issue. The fact of the matter a while, but as memories dulled, insider trad- the amendments had been adopted I is that insider trading is not given safe ing would pick up again,’’ said Lynch. ‘‘The would have been prepared to be sup- harbor protection and is absolutely temptation is too great for people to resist.’’ portive of this legislation. covered and will continue to be covered Mrs. BOXER. I yield such time as he But what is happening here is that by section 10(b) and rule 10b–5 of the se- desires to my friend from Maryland. the bill contains provisions that are far curities laws. It prohibits the kind of Mr. SARBANES. How much time in excess of dealing with frivolous fraudulent conduct that we consider to does the Senator have? suits. The provisions in this bill are be insider trading. Fraudulent conduct The PRESIDING OFFICER. Nineteen going to cut off meritorious suits, and and insider trading? The conduct that minutes and 41 seconds. they will make honest, legitimate in- Senator BOXER seeks to prohibit is al- Mr. SARBANES. I will be very brief vestors suffer as a consequence, as the ready prohibited in the securities law. so the Senator can reserve the balance Senator has so carefully outlined. I Let me tell you what the con- of her time. simply want to thank the Senator for sequences this amendment would be. I want to say the distinguished Sen- her very strong statement. They would be devastating. For exam- ator from California has made a very Mr. President, we have had difficulty ple, somebody who routinely takes strong, effective statement on behalf of with respect to these amendments, al- stock options—officers, directors in the her amendment. though we have come increasingly company—would lose safe harbor pro- Does the Senator agree with me that close on some of these amendments. I tection. This amendment would bring there are people who—corporate insid- think that is reflecting a growing sense us back to the situation that lawyers ers—who would sometimes make fraud- within this body that there is some- could simply allege fraud to bring a ulent forward-looking statements, to thing amiss with this legislation. lawsuit. This amendment opens the run up the stock price so they can un- All is not right with this legislation. door for the same kinds of operations load their stock price before it goes I think that is increasingly becoming that this legislation seeks to stop. down? Is that not exactly what has clear. There has been an effort to por- That is why I must oppose this bill, been happening? tray it by the proponents in terms of notwithstanding the fact this amend- Mrs. BOXER. Exactly. And we the competing economic interests. So ment seems to indicate that it pro- showed the same in two examples. Here they engage in long denunciations in hibits insider trading. This amendment is one of the charts. that regard. does not do that. Mr. SARBANES. Could we see the The fact is, every, as it were, inde- What this amendment does is strip other chart? That is Crazy Eddie’s. The pendent observer or outside group, has away, the opportunity for someone to other chart, as I understand it, the sounded warning bells about this legis- make a forward looking statement that Senator shows on the left where we lation. Members need to understand might at some point in time prove to begin, making the statements. That that. The Securities and Exchange be inaccurate. Why should a firm have runs their stock price up. Then they Commission, the North American Secu- the door to litigation opened just be- start unloading their stock, having rities Administrators Association, the cause an executive engaged in any done that. Government Finance Officers Associa- trades or exercised an options and Is that correct? tion. made $50,000? S 9160 CONGRESSIONAL RECORD — SENATE June 27, 1995 Tell me, if someone engages in legal in fact you are able to prove the first argumentative. I am being strong in insider trading should they be tarred point, assuming they met the other my response. and feathered? Should they be sued? qualifications of $50,000, would be pe- The PRESIDING OFFICER. If the However, should you have a right of ac- nalized under your amendment, were it Senator will suspend, I will advise the tion against illegal insider trading as to be enacted? Senators they may speak in third per- prohibited by rule 10b–5? Absolutely. Mrs. BOXER. I say to my friend, we son through the Chair. And that right of action does exist. indicate in the amendment who insid- Mr. D’AMATO. Mr. President, I So I have to oppose the amendment. ers are. It is pretty boilerplate. Yes, it would like to propound a unanimous- But again I commend my colleague for covers insiders, people who would have consent request so we might give, to coming forward and certainly for the inside information. But only, and I un- those of our colleagues who are off the manner in which she has made this derscore only, if in conjunction with Hill, an opportunity to get back and re- presentation tonight, in an attempt to the false or misleading statement they quest that we vote up or down on the accommodate so many of our col- sold stock and made a profit, they Graham amendment. leagues. would be covered. Have the yeas and nays been ordered I yield the floor. Mr. DODD. What about the directors on the Graham amendment? The PRESIDING OFFICER. The Sen- themselves? Not an officer, the direc- The PRESIDING OFFICER. The ator from Connecticut. tor. Directors—one of the compensa- Chair advises they have. Mr. DODD. Mr. President, I am going tions for directors is we offer them Mr. D’AMATO. Mr. President, I ask to wait until my colleague from Cali- stock options. unanimous consent we be permitted to fornia is back at her desk, because I The members of the board of direc- vote on the Graham amendment at 8 have some questions that the amend- tors did not have anything to do with o’clock. In this way we will give oppor- ment raises, that I would legitimately this; the officers of the companies did. tunity to all our Members to get back like to get some answers to. I am try- Let us assume that is the situation, as- and they would get a little extra no- ing to understand the implications of suming everything else is the case and tice. That would not interfere with any the amendment. that director, who had no involvement of the time my colleagues have. On page 2 of the amendment, as I whatsoever with the insider false state- The PRESIDING OFFICER. Is there read this, now—part of the difficulty is ments, as I read this, that innocent di- objection? under the previous amendment—— rector who then sold or bought stock Mr. DODD. I am glad to yield to my The PRESIDING OFFICER. If the innocently, outside of whatever else colleague. Do I not still have the floor? Senator will suspend, who controls the the officers may be doing, would then The PRESIDING OFFICER. Is there time? be subject to the penalties of this? objection to the unanimous consent? Mr. DODD. The Senator from New Mrs. BOXER. That is right. I say to Mr. SARBANES. What is the time York. my friend, we are using a pretty situation on the Boxer amendment? Mr. D’AMATO. Senator DODD is boilerplate definition of what an in- The PRESIDING OFFICER. Senator speaking on the time of the Senator sider is. The insider is the company it- BOXER has 13 minutes and 14 seconds; from New York. self or any officer or director. But only the other side has 5 minutes and 41 sec- The PRESIDING OFFICER. I thank if they sold their securities in connec- onds. the Senator from New York. tion with a false and misleading state- Mr. SARBANES. The time would ex- Mr. DODD. Mr. President, one of the ment, we do not give them the safe pire at 8 o’clock under the agreement difficulties is trying to read and under- harbor. We did not go out of our way to and then vote at 8 on the Graham stand. The previous amendment, of- reach them. We are just saying you amendment. fered by the Senator from Florida, was have to be an officer or director—— Mr. D’AMATO. Then maybe we might a 12-page amendment. Trying to read Mr. DODD. Even though the director be able to dispose of the other amend- through it and understand the implica- had nothing to do with the false and ment by consent. tions in the space of a short amount of misleading statements? We all know Mr. SARBANES. After the Graham time is difficult. how important stock options are, and amendment, the Bingaman amend- Let me come to page 2 of this amend- so forth. I want to know the implica- ment? ment. Starting on the bottom of page tions. Mr. D’AMATO. Possibly before, or 1. Mrs. BOXER. All it says is they can- after. Certainly. The PRESIDING OFFICER. Without Notwithstanding subsection (c), the exclu- not benefit from the safe harbor and sion from liability provided for in subsection the lawsuit can go forward. If, in the objection, it is so ordered. (a) does not apply to a false or misleading course of the lawsuit, it turns out that Mr. D’AMATO. I thank my col- forward-looking statement if, in connection this director is senile and did not know leagues. with the false or misleading forward-looking anything about it, or whatever the de- Mr. DODD. Mr. President, I yield to statement, the issuer or any officer or direc- fense is, that is different. But we are my colleague from California who tor of the issuer— saying as reasonable people that insid- wants to make a request. (A) purchased or sold . . . ers—and we define that as the com- The PRESIDING OFFICER. The Sen- And so forth. pany, any officer or director. ator from California. My concern is this, and correct me if I have to tell my colleague, if my Mrs. BOXER. Thank you, I say to my I am wrong. It seems to me you would friend from Connecticut does not view friend. Mr. President, I ask for the yeas be confronted with a factual situation that as a fair definition of an insider, I and nays on the Boxer amendment. where you have a director who had want to know what is—someone who The PRESIDING OFFICER. Is there a nothing to do with the problems associ- sits on the board of directors, someone sufficient second? ated with the Crazy Eddie case or who knows all the good news and bad There is a sufficient second. whatever else. I heard my colleague, news. The yeas and nays were ordered. and I agreed with her, give eloquent All we are saying is the case will Mr. DODD. Mr. President, if I can, let statements on the importance of stock have to go forward. But in fact, if there me just come back. The point I am try- options. It was on an issue not too is insider trading in connection with a ing to make here, and I say this with many months ago involving the value false or misleading statement, they do all due respect, no one wants to protect of stock options. She talked about not get the safe harbor and the case insider trading—obviously insider trad- what a valuable tool this can be. goes forward. Does it mean they are ing is an abhorrent exercise and prac- The mere action on the part of a di- convicted? Of course not. tice. rector to either purchase or sell a Mr. DODD. I am not trying to be ar- My concern here is that the mere ex- stock that may or may not—let us as- gumentative here. ercise of an option by, for the sake of sume did not have anything to do with Mr. D’AMATO. Will my colleague discussion, an innocent director—there what an officer of the company was yield? can be innocent directors here; not the doing regarding statements. Am I cor- Mrs. BOXER. I am trying to answer assumption that they automatically rect in assuming that director, then, if my friend’s questions. I am not being then take away the safe harbor for the June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9161 entire company because there has been row in scope. I have said, if Senator statements, that would be one thing. a sale or a purchase of an amount trig- SARBANES’ safe harbor provisions had You could have an outside director of a gered by the amounts indicated in the passed, I would not have gone with company that could live literally thou- amendment itself. I appreciate where this. But what I am saying is, why sands of miles away who exercises an my colleague from California wants to should we give such a good, nice, warm, option, and it has nothing to do with get. But my concern here is that she is and cozy safe harbor to crooks? It does the misleading statement. That is my reaching a legal conclusion about not mean automatically that anyone is point here. If the Senator said the di- someone where the assertion has been guilty of anything, I say to my friend. rector or officer makes the misleading made and the mere existence of that All we are saying is this is about get- statements, then I understand, I think, then takes away the safe harbor pro- ting a case brought forward and move where the Senator is going. But I do tections. I think that goes farther even forward. All we are saying is if an in- not understand why you take an out- for those who have strong reservations sider—I defy my friends, seriously, I do sider—— about safe harbor. I think that just not understand how I could have been Mrs. BOXER. Let me ask my friend strips away unnecessarily. That is just more fair in defining who an insider is on my own time. It is true, the director drawing a legal conclusion triggering a other than to say the company, an offi- could have been in Paris. He could have whole response to a safe harbor provi- cer or director. I did not say the sec- a call from someone. ‘‘Hey, Joe, tomor- sion on the mere assumption that retary or anybody else. I am just hit- row, the Wall Street Journal is giving someone has engaged in an illegal ac- ting the top people. If they sell securi- us a bad report.’’ tivity. ties in connection with a false or mis- Mr. DODD. That is different though. As I read the amendment, that is how leading forward-looking statement— Mrs. BOXER. Let me finish my point. I see it being triggered. When you talk when my friend read my amendment, We would not know that. The plaintiffs about any officer or any director who he left out the words ‘‘false or mislead- do not know that. If this man or purchased or sold a material amount of ing,’’—then all we are saying is they do woman is totally innocent, we are not equities and who financially benefited not get the benefit of the safe harbor. taking away his or her right. We are from the forward-looking statement in The case moves forward quicker. If just saying there is a smoking gun if a it, that is, to me, trying to put too they are innocent, this will take care director unloads, by the way, a large much in this with a lot of assumptions of it. amount, a material amount, makes a made that I do not think are nec- My goodness. Let us not make small good profit, and, quess what, in con- essarily borne out by the actions. To investors leap through hurdles when junction with a forward-looking state- assume there is inherently something you have a situation such as this where ment or a bad report coming out in the illegal, that it is an assumption of an clearly the insiders—by the way, there paper. It is worth it, we think, to allow illegal act for someone to exercise an were a lot of insiders here: $31 million that case to go forward. If the director option, and that action becomes a pre- worth of stock. I do not think that the is totally innocent, fine. All we are sumption of guilt in this context, then small investor who got caught in this saying is they should not have the safe stripping away safe harbor, I think, downward plummet should have to leap harbor of this particular bill as the goes too far. That is how I read it and through all sorts of hoops to get into good people should. And if, in fact, it understand it. court in this case. turns out that they were far away, I am going to yield the floor in a I hope my friends who support S. 240 they are on their honeymoon, they did will support this. I think we drew it minute and give my colleague from not take any calls, did not know any- narrowly. I think we are fair. I just California an opportunity to respond to thing about the fact that there was hope that we can get a good vote on how I read this. But that is my concern going to be a false statement, they are this amendment. going to walk away. God, I hope we here. I think it is taking an abhorrent Mr. SARBANES. Mr. President, I say have faith. activity of insider trading and then to the Senator from California, the Mr. DODD. The Senator has triggered using that vehicle as a way to try to Senator from Connecticut says we are a whole legal activity on the mere fi- jam it into the issue of the safe harbor. for it. If I could say, I am for legiti- My colleague from California and nancial transaction. The Senator has mate safe harbor, I am not for exces- then triggered a whole level of activity others have real problems with safe sive or overreaching safe harbor. That on safe harbor merely because she is harbor. I understand that. But it seems is what the whole debate has been assuming something that she has not to me that again we are taking a set of about today. actions where there is not necessarily I thought that the safe harbor issue been able to prove yet. But the mere anything wrong with them, making a should have been sent to the SEC the fact that some director exercises an op- presumption about that, and then tak- way the Senator from Connecticut pro- tion, that then the whole safe harbor ing that activity and immediately posed in his bill and that the SEC could process collapses, the Senator has con- stripping away the veil that protects then develop the safe harbor, taking nected a lot of dots here on the basis of the statements made in the forward- into account all of these complica- some assumptions. That, to me, is ex- looking statements that are made in tions. actly what we are trying to avoid. the context of predictions by compa- This body decided not to do that. So Mrs. BOXER. If this is what the Sen- nies, their direction, and thus triggered we then tried to have a different stand- ator is trying to avoid, then this is, in the safe harbor provisions. I for the life ard governing safe harbor. Again, the my view, a terrible bill. In other words, of me do not understand why we want regulators are telling us that the if you are trying to avoid giving an in- to necessarily do that when I do not standard in this bill is going to permit sider a hard time if he dumps his stock think those actions necessarily should abuse. Under the standard in this bill, and runs over—— trigger that kind of response. there will be abuses. The Senator from Mr. DODD. The Senator has drawn a So for those reasons, I object to the California is offering yet an even more legal conclusion. amendment. Again, I appreciate, I limited amendment addressed to the Mrs. BOXER. Not a bit. What we are think, the direction they want to go in, insider traders. She has demonstrated saying is you will meet a certain but it seems to me to be overreaching in very graphic form the kind of prac- threshold if these facts happen to come in terms of how you deal with safe har- tices that took place in two instances forward, a false and misleading state- bor. With that, I give my colleague a which she is trying to preclude and she ment in conjunction with insider sale. chance to respond to that. has offered a remedy. For the life of Look, I am not too naive about these The PRESIDING OFFICER. The Sen- me, I do not understand why this insider trades because I have seen it ator from California. amendment is being resisted. happen. Business Week did a whole Mrs. BOXER. Thank you, Mr. Presi- Mr. DODD. Will my colleague yield issue on insider trades. Let us bring dent. for the purpose of a question? that up. The Wall Street Journal has Mr. President, let me say to my Mr. SARBANES. It is on the time of run stories on this. Everybody is say- friend, to say that I am overreaching in the Senator from California. ing it is coming back in vogue. That is this amendment could not be farther Mr. DODD. If you told me the officer not BARBARA BOXER. Those are people off the mark, I have made this so nar- or director who made the misleading who are experts in the field. ‘‘Insider S 9162 CONGRESSIONAL RECORD — SENATE June 27, 1995 trades.’’ ‘‘It’s back, but with a new cast you vote for this Boxer amendment, The PRESIDING OFFICER. Without of characters.’’ All we are saying with you will thank those of us who brought objection, it is so ordered. this amendment, and I think this is im- it forward because the handwriting is VOTE ON AMENDMENT NO. 1479 portant, all we are saying is it is an in- on the wall. They are saying it is back The PRESIDING OFFICER. The hour sider, and we have narrowly defined in vogue, insider trading is back in is 8 o’clock. The question now is on that. vogue. If it occurs in connection with a agreeing to the amendment No. 1479 of- I challenge anyone to write a better false or misleading statement, not a fered by the Senator from Florida [Mr. definition of an insider other than the true statement but a false or mislead- GRAHAM]. The yeas and nays have been company itself, the board of directors ing statement, we say why should we ordered. The clerk will call the roll. or the officers. If they pocket huge give the benefit of that safe harbor to The assistant legislative clerk called amounts of money in connection with a those people? Let the case be brought the roll. false and misleading statement, they forward. Let the officer or director Mr. BOND (when his name was should not benefit from the safe har- make the point. But my goodness, to called). Present. bor. Now, the case goes forward. If they argue against this amendment, I just Mr. LOTT. I announce that the Sen- are away and they can prove it, fine. am rather stunned. I was hopeful that ator from Rhode Island [Mr. CHAFEE], But we are changing the law radically we could have an agreement on both the Senator from North Carolina [Mr. here. We are going far beyond anything sides. I thought we could from the be- HELMS], the Senator from Vermont the Senator from Connecticut proposed ginning. I was hit with all kinds of ar- [Mr. JEFFORDS], the Senator from Indi- doing in his original bill. We have a guments the first time I brought this ana [Mr. LUGAR], and the Senator from safe harbor that has caused 48 Senators up: well, it is covered in another sec- Tennessee [Mr. THOMPSON] are nec- in this Chamber to say we want to tion. If you bought the shares the in- essarily absent. change it. We have a safe harbor in S. sider sold, yes, you are covered in an- Mr. FORD. I announce that the Sen- 240 that has the SEC saying they are other section. ator from Hawaii [Mr. INOUYE] is nec- very worried that there will be in- What about the general public? They essarily absent. creases in fraud. are not covered. And yet those direc- The PRESIDING OFFICER (Mr. Now, I think as a Senator from the tors, those officers, who pocketed that ASHCROFT). Are there any other Sen- largest State in the Union, where a lot money are protected by the safe har- ators in the Chamber who desire to of this happens—we look to the bor. vote? Keating people, and a lot of it was Cali- I have reiterated this on a number of The result was announced—yeas 32, fornia—I have an obligation to make occasions, and I do not feel the need to nays 61, as follows: this bill better. continue at this point; my energy level [Rollcall Vote No. 290 Leg.] I would far prefer to have the safe is running down. But I have to come YEAS—32 harbor that my friend from Maryland back tomorrow and present this in 5 Akaka Feingold Levin proposed. Instead, we have this other minutes. So I look forward to that con- Biden Graham McCain safe harbor that my friend from Con- clusion tomorrow, and I hope a favor- Bingaman Harkin Moynihan necticut embraces. And we are saying Boxer Hatfield Nunn able vote. I know that my colleagues Bradley Heflin you are opening it up for everybody. Pell have been hanging on my every word Breaux Hollings Rockefeller How about closing it for some obvious and everything I read here. I know that Bryan Johnston Sarbanes abuses. they are sitting in their offices, and Byrd Kennedy Shelby Conrad Kerrey Simon Mr. DODD. Will my colleague yield they are absolutely intrigued by this Daschle Kohl Wellstone on that point? debate. I hope if they did watch all of Dorgan Lautenberg Mrs. BOXER. I will. it they will come down and vote yes on NAYS—61 Mr. DODD. Again, I am not arguing the Boxer amendment tomorrow after about the spirit of what the Senator is Abraham Ford Moseley-Braun we reiterate this argument and get it Ashcroft Frist Murkowski trying to do. And no one is here trying down to 5 minutes tomorrow morning. Baucus Glenn Murray to defend insider trading. But at this Mr. President, how much time do I Bennett Gorton Nickles juncture, when we have tried to get di- have remaining? Brown Gramm Packwood Bumpers Grams Pressler rectors to buy stock—it is one of the The PRESIDING OFFICER. The Burns Grassley things we have tried to do over the Pryor Chair advises the Senator from Califor- Campbell Gregg Reid Coats Hatch years in our committee, purchase stock nia she has 2 minutes. Robb Cochran Hutchison and get involved—I would have to say Roth Mrs. BOXER. I will save that time, Cohen Inhofe today, if this amendment were adopted, Mr. President, in case something is Coverdell Kassebaum Santorum the last thing you would want to do is stated here to which I feel I must re- Craig Kempthorne Simpson become even a purchaser. Forget a sell- D’Amato Kerry Smith tort. Otherwise, I will be happy to yield DeWine Kyl Snowe er; the amendment says even purchas- back. Dodd Leahy Specter ing stock here. You are removed from Mr. D’AMATO. Mr. President, do we Dole Lieberman Stevens the process. All of a sudden you are have any time remaining? Domenici Lott Thomas trying to buy. My advice to anyone in Exon Mack Thurmond The PRESIDING OFFICER. The time Faircloth McConnell Warner that category, if this amendment were remaining on the Senator’s side of the Feinstein Mikulski to be adopted, would be to stay away aisle is 13 seconds. ANSWERED ‘‘PRESENT’’—1 from this. I would stay entirely away Mr. D’AMATO. Well, Mr. President, I from this. It would have absolutely the am prepared to yield back the remain- Bond countereffect as we try to get people to der of our time. I yield the floor. NOT VOTING—6 acquire this stock. You are subjecting Mrs. BOXER. Mr. President, in the Chafee Inouye Lugar yourself to some very dangerous situa- spirit of comity and good will across Helms Jeffords Thompson tions. the party aisle, I will yield back my 2 So the amendment (No. 1479) was re- Mrs. BOXER. Let me take my time minutes. jected. because my friend is distorting what The PRESIDING OFFICER. All time Mr. D’AMATO. Mr. President, I move this amendment does. He is distorting is yielded back. to reconsider the vote. what this amendment does. No honest Mrs. BOXER. I note the absence of a Mr. BIDEN. I move to lay that mo- director, no honest person has to fear quorum. tion on the table. about this amendment. Only the The PRESIDING OFFICER. The The motion to lay on the table was crooks. Only the crooks. And all we are clerk will call the roll. agreed to. saying is this is a problem. ‘‘Insider- The assistant legislative clerk pro- Mr. D’AMATO. Mr. President, let me Trading Probes Make a Comeback,’’ ceeded to call the roll. say that if we get this unanimous con- Saturday’s edition of the L.A. Times. Mr. D’AMATO. Mr. President, I ask sent agreement, all those Members who I say to my friends in the Senate unanimous consent that the order for have asked to have amendments con- from both sides of the aisle, I think if the quorum call be rescinded. sidered will have them considered. All June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9163 of the votes on those amendments will The PRESIDING OFFICER. Without sylvania for allowing me to move take place tomorrow, or tonight by objection, it is so ordered. ahead. He is always gracious to me and voice. So what I am saying is there will Mr. D’AMATO. Mr. President, I fur- I appreciate it. be no further rollcall votes. And all of ther ask unanimous consent that all of There is a carve-out in this legisla- the debate, with the exception of, I be- the votes after the first vote in the vot- tion, carving out securities fraud from lieve, 7 minutes for one Member, and ing sequence be limited to 10 minutes the application of the civil RICO stat- the intervening times, will take place each, except for final passage. utes. I think that is a bad idea. But I this evening. I am going to propound The PRESIDING OFFICER. Without will not debate that issue tonight. that request. objection, it is so ordered. I have an amendment that is before UNANIMOUS-CONSENT AGREEMENT Mr. D’AMATO. Mr. President, there the body that says such a carve-out ex- Mr. D’AMATO. Mr. President, I ask will be no further rollcall votes this ists, except that it shall not apply if unanimous consent that the following evening, and the first vote tomorrow is any participant in fraud is criminally amendments be the only remaining at 8:45 a.m. The first amendment to be convicted; then RICO can apply, and first degree amendments in order, in order will be the Biden amendment, the statute does not begin to toll until other than the committee-reported which will be kept under 5 minutes. the day of the conviction becomes substitute, that no second-degree Thereafter, the Bingaman amendment final. amendments be in order and that all will follow, which will also be limited Keeping with the admonition of Rus- amendments must be offered and de- to 5 minutes, to be followed by Senator sell Long, I have no further comment bated this evening: The Biden amend- Specter’s three amendments. on the amendment. ment; the Bingaman amendment; the Mr. SARBANES. The first vote in the Mr. D’AMATO. Mr. President, we D’Amato-Sarbanes managers amend- morning will be at 8:45. I remind my have no objection. We accept that ment; the Boxer amendment, re: in- colleagues, that is a vote at 8:45. amendment. sider trading; the Specter amendment, The PRESIDING OFFICER. The first The PRESIDING OFFICER. If there re: fraudulent intent; the Specter vote will be 8:45. is no further debate, the question is on amendment, re: rule 11B; the Specter Mr. D’AMATO. Mr. President, I ask agreeing to the amendment. amendment, re: stay of discovery. unanimous consent that the pending The amendment (No. 1481) was agreed The PRESIDING OFFICER. Without amendment be set aside so the Senator to. objection, it is so ordered. from Delaware can offer his amend- Mr. BIDEN. I move to reconsider the Mr. D’AMATO. I further ask that ment. vote. when the Senate completes its business The PRESIDING OFFICER. Without Mr. SARBANES. I move to table the today, it stand in recess until 8:40 a.m., objection, it is so ordered. The pending motion. and at 8:45 a.m. the Senate proceed to amendment is set aside. The motion to lay on the table was vote on or in relation to the first Spec- AMENDMENT NO. 1481 agreed to. ter amendment, and that following the Mr. BIDEN. Mr. President, I send an AMENDMENT NO. 1482 conclusion of that vote, there be 4 min- amendment to the desk and ask for its (Purpose: To clarify the application of sanc- utes for debate, to be equally divided immediate consideration. tions under rule 11 of the Federal Rules of on the second Specter amendment, to The PRESIDING OFFICER. The Civil Procedure in private securities litiga- be followed by a vote on or in relation clerk will report. tion) to the second Specter amendment. Mr. BINGAMAN. Mr. President, I The PRESIDING OFFICER. Without The legislative clerk read as follows: The Senator from Delaware [Mr. BIDEN] send an amendment to the desk and objection, it is so ordered. ask for its immediate consideration. Mr. D’AMATO. I further ask that fol- proposes an amendment numbered 1481. The PRESIDING OFFICER. The lowing the vote on the second Specter Mr. BIDEN. Mr. President, I ask pending amendment is set aside. The amendment, there be 4 minutes for de- unanimous consent that reading of the clerk will report. bate, to be equally divided, on the third amendment be dispensed with. The legislative clerk read as follows: Specter amendment, to be followed by The PRESIDING OFFICER. Without a vote on or in relation to the Specter objection, it is so ordered. The Senator from New Mexico [Mr. BINGA- amendment. The amendment is as follows: MAN], for himself and Mr. BRYAN, proposes an amendment numbered 1482. The PRESIDING OFFICER. Without At the appropriate place insert: objection, it is so ordered. SEC. . AMENDMENT TO RACKETEER INFLU- Mr. BINGAMAN. Mr. President, I ask Mr. D’AMATO. I further ask that fol- ENCED AND CORRUPT ORGANIZA- unanimous consent that further read- lowing the vote on the third Specter TIONS ACT. ing of the amendment be dispensed amendment, there be 7 minutes for de- Section 1964(c) of title 18, United States with. Code, is amended by inserting before the pe- bate, to be divided under the previous The PRESIDING OFFICER. Without riod ‘‘, except that no person may rely upon objection, it is so ordered. order, to be followed by a vote on or in conduct that would have been actionable as relation to the Boxer amendment. fraud in the purchase of sale of securities to The amendment is as follows: The PRESIDING OFFICER. Without establish a violation of section 1962’’, pro- On page 105, line 25, insert ‘‘, or the respon- objection, it is so ordered. vided however that this exception shall not sive pleading or motion’’ after ‘‘complaint’’. Mr. D’AMATO. I further ask that fol- apply if any participant in the fraud is crimi- On page 107, line 20, insert ‘‘, or the respon- lowing the disposition of the Boxer nally convicted in connection therewith, in sive pleading or motion’’ after ‘‘complaint’’. amendment, the committee substitute, which case the statute of limitations shall Mr. BINGAMAN. Mr. President, I as amended, be agreed to and S. 240 be start to run on the date that the conviction send this amendment on behalf of my- advanced to third reading, and the becomes final. self and Mr. BRYAN. It is a very simple Banking Committee be discharged Mr. BIDEN. Mr. President, I have amendment. from further consideration of H.R. 1058, been here a while. When I first got here The present bill, as it is pending be- the House companion bill, and the Sen- 23 years ago, I learned a lesson from fore the Senate, calls for a mandatory ate proceed to its immediate consider- Russell Long. review by the court in any private ac- ation; that all after the enacting clause I went up to him on a Finance Com- tion arising under the legislation. It be stricken and the text of S. 240, as mittee day and asked to have an says that the court shall establish a amended, be inserted in lieu thereof, amendment accepted, and he said yes. I record with specific findings regarding and H.R. 1058 be considered read the proceeded to speak on it half an hour compliance by each party, and each at- third time. and say why it was a good amendment. torney representing any party with the The PRESIDING OFFICER. Without And he said, ‘‘I changed my mind. Roll- requirements of rule 11 of the Federal objection, it is so ordered. call vote.’’ I lost. He came later and he Rules of Civil Procedure, prohibiting Mr. D’AMATO. I further ask unani- said, ‘‘When I accept an amendment, frivolous pleading or frivolous activity mous consent that at that point there accept the amendment and sit down.’’ by counsel. be 30 minutes for closing remarks, to I will take 30 seconds to explain my The difficulty is that later in the bill be equally divided in the usual form, to amendment because it is about to be where it specifies presumption, that we be followed by a vote on H.R. 1058. accepted. I thank my friend from Penn- call for on page 105 and 107 of the bill, S 9164 CONGRESSIONAL RECORD — SENATE June 27, 1995 we only specify that the appropriate kind of very thoughtful encrustation volving some $262 million recovered sanction apply to pleadings filed by the that comes through common law devel- and some $288 million lost; the $2 bil- plaintiffs. opment and interpretation of the secu- lion lost in the Washington Public Our amendment would change that rities acts. Power Supply System case—mention- and make it more balanced, in that it I have represented both sides in secu- ing only a few. would specify that the sanctions could rities litigation before coming to the The concern that I have on the legis- apply either to pleadings filed by the U.S. Senate in the private practice of lation as it is currently pending is that plaintiff or to responsive pleadings or law. I would remind my colleagues that there is an imbalance which will dis- motions filed by defense. before we proceed to make such enor- courage this very important litigation I think this is acceptable to the man- mous changes by this legislation, we to protect the shareholders. I have sup- agers of the bill. I think it is only rea- need to recall the importance of pro- ported the managers of the bill on a sonable that if we are going to have tecting investors, especially small in- number of the amendments which have this provision in the bill—which is a vestors, small unsophisticated inves- been filed, but I am going to submit a provision, quite frankly, I do not agree tors, in some cases, who put a substan- series of three amendments which, I with—I think that singling out these tial part of their savings, perhaps all of submit, will make the bill more bal- securities cases as the only cases in our their life savings, into securities, and anced. court system where we require a man- how much is involved in the accretion The PRESIDING OFFICER. Without datory review by the court, and the of capital through corporations, objection the pending amendment will finding and imposition of specific find- through common stock, compared to be set aside. ings, is a mistake. If we are going to what is the thrust of this legislation, AMENDMENT NO. 1483 have it, we should make it balanced be- really looking to curb some lawsuits (Purpose: To provide for sanctions for tween plaintiff and defendant. which should not be brought, some abusive litigation) I know the Senator from Nevada frivolous lawsuits which ought not to Mr. SPECTER. At this time, Mr. wishes to speak. I yield the floor. have been filed, and perhaps some of President, I send an amendment to the Mr. BRYAN. Mr. President, first let the excesses in the plaintiffs’ bar, as desk and ask for its immediate consid- me commend my colleague from New there may be excesses in any group. eration. Mexico. I think his amendment is well- What we are looking at is the value The PRESIDING OFFICER. The constructed. We have used the word of shares traded in 1993 on the stock ex- clerk will report. often in the course of the debate—bal- changes, the most recent year avail- The legislative clerk read as follows: anced. This is balanced. What is sauce able for analysis. Mr. President, the The Senator from Pennsylvania [Mr. SPEC- for the goose is sauce for the gander. $6.63 trillion traded on the stock ex- TER] proposes an amendment numbered 1483. Those lawyers, whether they be changes in 1993 is more than half of the Mr. SPECTER. Mr. President, I ask plaintiff’s lawyers or defendant’s law- gross national product of the United unanimous consent that reading of the yers who are involved in frivolous con- States in 1963. The value of initial pub- amendment be dispensed with. duct, now feel the full effect of sanc- lic offerings in 1993, was $57.444 billion. The PRESIDING OFFICER. Without tioned rule 11 under the Federal Rules If we take a look at the comparison objection, it is so ordered. of Civil Procedure. as to how much is spent on attorney’s The amendment is as follows: Much has been said about the frivo- fees, according to a 1990 article in the lous nature of this lawsuit correction Class Action Reports, a review of some Beginning on page 105, strike line 1 and all act. I must say this is one of the few 334 securities class action cases decided that follows through page 108, line 17, and in- sert the following: amendments that actually deals with between 1980 and 1990, a group of cases SEC. 103. SANCTIONS FOR ABUSIVE LITIGATION. this issue. I am pleased to support my in which there was a recovery of $4.281 (a) SECURITIES ACT OF 1933.—Section 20 of colleague and friend from New Mexico, billion, only some 15.2 percent of that the Securities Act of 1933 (15 U.S.C. 77t) is and I am pleased that the managers recovery went to fees and costs, a total amended by adding at the end the following have agreed to accept the amendment. of some $630 million. new subsection: I urge its adoption. In those cases, according to the court ‘‘(j) SANCTIONS FOR ABUSIVE LITIGATION.— The PRESIDING OFFICER. The records, the attorneys for the plaintiffs In any private action arising under this title, question is on agreeing to the amend- spent 1,691,642 hours. if an abusive litigation practice relating to ment. Statistics have already been pre- the action is brought to the attention of the The amendment (No. 1482) was agreed sented on the floor of the Senate which court, by motion or otherwise, the court show a decrease in securities litigation. shall promptly— to. ‘‘(1) determine whether or not to impose Mr. SARBANES. I move to recon- I submit that it is very important to be sanctions under rule 11 or rule 26(g)(3) of the sider the vote. able to continue to protect investors— Federal Rules of Civil Procedure, section Mr. D’AMATO. I move to table the especially small investors—from stock 1927 of title 28, United States Code, or other motion. fraud. authority of the court; and The motion to lay on the table was We know that in the crash of the De- ‘‘(2) include in the record findings of fact agreed to. pression, 1929 and thereafter, tremen- and conclusions of law to support such deter- Mr. SPECTER. Mr. President, I have dous savings were lost at that time. mination.’’. sought recognition to offer three These losses gave rise to the legislation (b) SECURITIES EXCHANGE ACT OF 1934.— Section 21 of the Securities Exchange Act of amendments which I think will provide in 1933 and 1934 to protect investors and 1934 (15 U.S.C. 78u) is amended by adding at some balance to the legislation that is the securities markets. the end the following new subsection: now pending before the Senate. Without speaking at length on the ‘‘(l) SANCTIONS FOR ABUSIVE LITIGATION.— I believe that there is a need for some subject, I would point to a few cases In any private action arising under this title, modification of our securities acts, but where there were very substantial if an abusive litigation practice relating to I think it has to be very, very carefully losses to the public and in which pri- the action is brought to the attention of the crafted. vate actions were brought to enforce court, by motion or otherwise, the court As I take a look at what is occurring the securities laws. For example, the shall promptly— in the courts, compared to what hap- ongoing Prudential Securities litiga- ‘‘(1) determine whether or not to impose sanctions under rule 11 or rule 26(g)(3) of the pens in our legislative process, I think tion, with over $1 billion in losses, per- Federal Rules of Civil Procedure, section that the very deliberative rule in the haps as much as double that; the Mi- 1927 of title 28, United States Code, or other courts, case by case, with very, very chael Milken cases, where there were authority of the court; and careful analysis, has to take prece- recoveries in the range of $1.3 billion, ‘‘(2) include in the record findings of fact dence over the procedures which we use involving Drexel, Burnham & Lambert, and conclusions of law to support such deter- in the Congress where hearings are at- recovered by the Federal Deposit Insur- mination.’’. tended, sometimes by only one or two ance Corporation under the securities Mr. SPECTER. Mr. President, this Senators, and then provisions are laws; we all know the famous Charles amendment is designed to leave discre- added in markup very late in the proc- Keating case, involving his former tion with the trial judge in place of the ess. Legislation does not receive the company, Lincoln Savings & Loan, in- very onerous provisions of the pending June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9165 bill which require a mandatory review Earlier in the consideration of this quate authority to impose appropriate by the court after each securities case bill I made an effort to have these is- sanctions for conduct that violates is concluded and then a requirement sues on procedure referred to the Judi- Rule 11.’’ that the court impose sanctions on a ciary Committee, on which I serve, Mr. President, a number of the judi- party if the court finds that the party which has the most experience of any cial comments which I am about to violated any requirement of rule 11(b) committee in the Congress—certainly read apply to my second amendment as with the presumption being that attor- more than the Banking Committee, well. That second amendment relates ney’s fees will be awarded to the losing which has jurisdiction over this bill— to a provision in the bill which requires party. because hearings were not held and that the court not allow discovery I submit that this is a very harsh consideration was not given to this after a motion to dismiss is filed. On rule which will have a profoundly rule 11 provision. that particular line, the rule is that chilling effect on litigation brought Among the responses which I re- discovery may proceed unless the judge under the securities acts, and will in ceived, some 164 responses from Fed- eliminates discovery. Under the pend- addition spawn an enormous amount of eral judges, there was a general sense ing legislation, there would be no dis- additional work for the Federal courts that the trial judges ought to have the covery as a matter of mandate unless by causing what is called satellite liti- discretion and were in the best position under very extraordinary cir- gation. to make a determination as to whether cumstances, but the mandatory rule That means that in any case where sanctions ought to be imposed without applies. And the comments of Judge the litigation is concluded under the having a mandate from the Congress, Parker would apply to the second securities acts, the judge will be com- the micromanagement from the Con- amendment as well, the second amend- pelled, under the mandatory review gress, saying you must make this de- ment which I propose to bring. provision, to review all the pleadings termination. Even though the winning Mr. President, the statement by filed in the case to determine whether party did not ask for it, even though Judge Bill Wilson of the Eastern Dis- rule 11 was violated, whether or not ei- there are not procedures for one party trict of Arkansas, in a letter dated ther party chooses to have that review to say to the other, ‘‘You are undertak- April 27, is to the same effect, as fol- made, and then will be compelled to ing something which our side considers lows: impose the sanction with the presump- frivolous and, if you do not cease and Federal Rule . . . 11, as it now reads, gives tion being payment of attorney’s fees, desist, we will bring an action to im- a judge all he or she needs to handle im- which is really the British system, not pose sanctions,’’ to have a chance to proper conduct. And I think we should all the United States’ system, where we correct it. keep in mind that we can’t promulgate rules have had open courts. This provision A very lucid statement of the prob- good enough to make a good judge out of a risks causing a tremendous imbalance lem was made by a very distinguished bad one. between plaintiffs and defendants in judge for the Court of Appeals for the On that point, Mr. President, I think these cases because the defendants are Third Circuit, Judge Edward R. Becker, it is fair and appropriate to note that characteristically major corporations who had this to say. we have a very able Federal judiciary with much greater resources to defend, The mandatory sanctions are a mistake which can administer justice if left to contrasted with the plaintiffs who do and will only generate satellite litigation. do so with appropriate discretion. not have those resources, or their law- By satellite litigation, Judge Becker Judge Prentice H. Marshall of the yers who bring the suits on their be- is referring to the situation where an- Northern District of Illinois said this half. other lawsuit, another issue has to be in a May 5 letter: I have surveyed the Federal bench, litigated as to whether a rule 11 sanc- Rule 11 . . . gives the judge greater flexi- the judges in the U.S. district courts tion should be instituted. Again, not at bility in the imposition of sanctions; it af- and in the courts of appeals, to see how the request of the losing party. Judge fords the offending party the opportunity to correct his or her misdeed. the judges respond to changes in rule 11 Becker continues to this effect: to take away the discretion of the trial A letter from Martin F. Loughlin of judges and have what is, in effect, The flexibility afforded by the current re- gime enables judges to use the threat of the District of New Hampshire, dated micromanagement of the judiciary by sanctions to manage cases effectively. Well- May 2 reads: the Congress of the United States. I managed cases almost never result in sanc- Federal Rule of Civil Procedure 11 is work- have done this to try to get a sense as tions. Moreover, the provisions for manda- ing well. It gives the judge adequate discre- to what is going on in the courts. It has tory review, presumably without prompting tion to deal with frivolous litigation and un- been some time since I practiced there. by the parties, will impose a substantial bur- toward conduct by attorneys. I submit that the views of a few Sen- den on the courts and prove completely use- A letter from Federal Judge Miriam less in the vast majority of cases. Requiring ators, the authors of this bill and the Goldman Cedarbaum from the South- Senators who are voting on this legis- courts to impose sanctions without a motion of a party also places the judge in an inquisi- ern District of New York, dated May lation, are a great deal more limited torial role, which is foreign to our legal cul- 10, 1995, says in part: than the insights of the Federal judges ture, which is based on the judge as a neutral I have found the general supervisory power who preside in the administration of arbiter model. of the court as well as 28 U.S.C., Section 1927, these cases day in and day out. The A very cogent reply was made by and Rule 11 adequate sources of judicial au- procedures which are being followed in Judge James A. Parker, of the United thority to discourage frivolous litigation. this legislation are not those cus- States District Court for the District A letter from Federal Judge J. Fred- tomarily followed where the rules of of New Mexico, who had this to say: erick Motz from the District of Mary- civil procedure are formulated by the As a member of the judiciary, I implore land, dated May 9, 1995, referring to the Federal courts under the Rules Ena- members of the legislative branch of govern- mandatory rules said that they are: bling Act—the Supreme Court which ment to follow the Rules Enabling Act proce- . . . counterproductive in that it increased has the authority to do so, and the del- dures for amending rules of evidence and pro- judges’ workloads and contributed to litiga- egation of that authority to commit- cedure that the courts must apply. Congress tion cost and delay by requiring judges to tees where the judges work with it all demonstrated great wisdom in passing the impose sanctions whenever a Rule 11 viola- the time, and representatives of the Rules Enabling Act which defines the appro- tion was found. Satellite litigation in which bar, as opposed to the Members of Con- priate roles of the legislative and judicial one lawyer or party sought fees from another gress, who have very, very limited ex- branches of government in adopting new became commonplace. rules or amending existing rules. Those who Continuing to quote: perience in this field and, in this par- hold the strong and sincere belief that ticular case, had this provision added changes should be made to the current for- I oppose any amendment to the Rule that very late in the process, late in May, a mulation of Rule 11 should present their would make imposition of sanctions manda- few days before there was final markup views and proposals in accordance with the tory. of the bill in the Banking Committee, procedures set forth in the Rules Enabling A similar view was expressed by which does not normally deal with is- Act. Judge Ilana Diamond Rovner of the sues of the Federal Rules of Civil Pro- Judge Parker further writes that Court of Appeals for the Seventh Cir- cedure. ‘‘Rule 11 * * * gives federal judges ade- cuit in a letter dated April 1995: S 9166 CONGRESSIONAL RECORD — SENATE June 27, 1995 The current Rule 11 gives the District Mr. President, I submit to my col- tremely detrimental to the orderly function- Court ample discretion to address frivolous leagues that leaving the discretion to ing of the courts. litigation. the judge really is the right way to (3) What suggestions, if any, do you have in relation to this issue? A letter from Senior Judge Floyd R. handle these matters. These judges sit Gibson from the U.S. Court of Appeals Response: As a member of the judiciary I on these cases, know the cases, and implore members of the legislative branch of for the Eighth Circuit, dated April 20, have ample authority as a discre- government to follow the Rules Enabling Act 1995: tionary matter to impose the sanction. procedures for amending rules of evidence I believe more discretion should be given As one judge said, all these rules can- and procedure that the courts must apply. to the district judge in the how and when to not make a bad judge do the right Congress demonstrated great wisdom in apply the sanctions under Rule 11(c) on sanc- passing the Rules Enabling Act which de- tions. thing. But I think we can rely upon the discretion of the judges without tying fines the appropriate roles of the legislative Similarly, Judge Avern Cohn from and judicial branches of government in their hands. adopting new rules or amending existing the Eastern District of Michigan, dated Mr. President, I would be glad to May 5, 1995, says, in part: rules. Those who hold a strong and sincere yield the floor at this time to argu- belief that changes should be made to the I firmly believe that Congress involves it- ment by the managers if they would current formulation of Rule 11 should self too deeply in the procedural aspects of present their views and proposals in accord- the litigation process. care to do so. We can then proceed to conclude the argument on this amend- ance with the procedures set forth in the A letter from Martin Feldman from ment. Rules Enabling Act. the Eastern District of Louisiana, says, If you wish, I will be happy to provide addi- in part: EXHIBIT 1 tional information on this subject either I believe that giving district courts more UNITED STATES DISTRICT COURT, orally or in writing. discretion in applying the Rule was good DISTRICT OF NEW MEXICO, Sincerely, thinking. Albuquerque, New Mexico, May 2, 1995. JAMES A. PARKER. Hon. ARLEN SPECTOR, And Judge Jimm Larry Hendren of U.S. Senate, Committee on the Judiciary, U.S. DISTRICT COURT, the Western District of Arkansas, Wsshington, DC. EASTERN DISTRICT OF ARKANSAS, writes, in part: DEAR SENATOR SPECTOR: Thank you for Little Rock, AR, April 27, 1995. I am not sure the Congress needs to pass your letter of April 24, 1995 and the oppor- Hon. ARLEN SPECTER, any legislation. I think the courts, them- tunity to express comments on issues involv- U.S. Senate, Committee on the Judiciary, selves, can handle this matter with the rules ing Rule 11 of the Federal Rules of Civil Pro- Washington, DC. already in place and their inherent powers. cedure. DEAR SENATOR SPECTER: Thank you very And a letter from Judge Leonard I. For purposes of clarity, I have restated much for your letter of April 6, 1995. each question posed in your April 24, 1995 let- Garth, a distinguished member of the In the year and a half that I have been on ter followed by my response. the bench I have had no problem with frivo- Court of Appeals for the Third Circuit, (1) Is there a significant problem with friv- lous litigation. I have sanctioned two law- says: olous litigation in the Federal Courts such yers for engaging in what I thought to be in- In my opinion, abandoning mandatory as to justify ‘‘loser pays’’ and strengthening appropriate discovery procedures, but have sanctions and permitting district court of FRCP 11? had no experience with FRCP 11 as a trial judges to exercise their judicial discretion Response: Rule 11, as amended effective judge. was a welcome measure. December 1, 1993, gives federal judges ade- I am strongly opposed to the ‘‘loser pays’’ A good many of these comments quate authority to impose appropriate sanc- proposal. I am told by my scholarly friends apply to the change in rule 11, which tions for conduct that violates Rule 11. Rule that this is a British rule. With all due re- 11(c) states that if Rule 11 has been violated had been mandatory from 1983 to 1993. spect for our kinfolks across the Atlantic, ‘‘the Court may, subject to the conditions many of our ancestors got on a ship and It would apply equally well to the kind stated below, impose an appropriate sanction came to the United States because they were of a rule which is in effect here. upon the attorneys, law firms, or parties not particularly fond of the justice system in The letter from Senior Judge Wil- that have violated subdivision (b) or are re- Britain. In all seriousness, I do have a lot of liam Schwarzer from San Francisco sponsible for the violation.’’ Rule 11(c)(2) de- respect for some aspects of the system in says that the sanctions ought to be dis- scribes the sanctions that may be imposed England, but, in my opinion, ours is much cretionary. for a violation. These include directives of a superior. Mr. President, I ask unanimous con- non-monetary nature, an order to pay a pen- The ‘‘loser pays’’ will obviously slam the sent that these letters, which represent alty into Court, or an Order directing that courthouse door shut in the face of deserving an unsuccessful movant who has violated only a small sample of the responses I citizens who are not well heeled financially. Rule 11 pay ‘‘some or all the reasonable at- It appears to me that the 1993 Amendment received supporting discretionary im- torneys’ fees and other expenses incurred as to FRCP 11 was much needed. The rule, be- position of sanctions, appear in the a direct result of the violation.’’ At this fore these changes, tended to be too rigid, at RECORD at the conclusion of my state- point there appears to be no need to change least on the surface. It encouraged satellite ment, with the exception of the letter Rule 11, or to pass legislation, to introduce a litigation. FRCP 11, as it now reads, gives a from Judge Becker. more stringent ‘‘loser pays’’ sanction. judge all she or he needs to handle improper The PRESIDING OFFICER. Without (2) How well did FRCP 11 work after the conduct. And I think we should all keep in objection, it is so ordered. 1983 Amendment, which strengthened the mind that we can’t promulgate rules good (See exhibit 1.) rule, and since the 1993 Amendment, which enough to make a good judge out of a bad Mr. SPECTER. Mr. President, I now weakened the rule? one. Response: In this judicial district, consid- refer again to the letter from Judge Finally, I would like to comment on the erable satellite litigation developed under ‘‘crisis’’ claims that are being made about Becker citing the draft of a rule from Rule 11 after the 1983 amendment. This re- the case load in federal district courts. I Circuit Judge Patrick Higginbotham, quired judges to devote significant time to quote from Judge G. Thomas Eisele: Differing who is chairman of the Judicial Con- resolving squabbles among counsel unrelated Visions—Differing Values: A Comment on Judge ference Advisory Committee on Civil to the merits of the case. The 1993 amend- Parker’s Reformation Model for Federal District Rules, which sets out the amendment ment of Rule 11 has dramatically reduced the Courts, 46 SMU L. Rev. 1935 (1993): which I have submitted, and it is to number of motions alleging Rule 11 viola- .. . In 1985 the total case filings in all U.S. this effect: that the sanction for abu- tions. This I attribute directly to the ‘‘safe District Courts came to 299,164; in 1986, harbor’’ provision found in Rule 11(c)(1)(A). 282,074; in 1987, 268,023; in 1988, 269,174; in 1989, sive litigation would arise in any pri- The ‘‘safe harbor’’ provision has forced law- 263,896; in 1990, 251,113; in 1991, 241,420; and in vate action when the abusive litigation yers to communicate and to resolve their 1992, 261,698. So in a period of seven years the practice is brought to the district disputes in most instances without the need total filings have fallen from 299,164 to court’s attention by motion or other- for Court intervention. My personal opinion 261,698. The number of civil filings per judge- wise. The court shall promptly decide is that this feature of the 1993 amendment of ship fell from 476 in 1985 to 379 in 1990—a pe- with written findings of fact and con- Rule 11 strengthened instead of weakened riod when the number of judgeships re- clusions of law whether to impose sanc- Rule 11. It has made the lawyers talk to each mained constant at 575. In 1991 the number of tions under rule 11, and upon the adju- other about claims or defenses perceived by judgeships increased to 649 and the number their opponents to be frivolous and this has of civil cases per judgeship fell to 320. For dication, the district court shall in- resulted in most disputes being resolved 1992 the figure is 350. clude the conclusions and shall impose without extensive briefing and devotion of ‘‘We are frequently told that our criminal the sanctions which the court in the valuable court time. Removal of the ‘‘safe dockets are interfering with our civil dock- court’s discretion finds appropriate. harbor’’ provision from Rule 11 would be ex- ets, and this has certainly been true in a few June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9167 of our federal districts. But the number of With respect to question #2 FRCP 11 is cases a significant incentive for attorneys to felony filings per judgeship only increased working well. It gives the judge adequate forum shop. from forty-four in 1985 to fifty-eight in 1990. discretion to deal with frivolous litigation Similarly, I oppose any amendments to In 1992, that number fell to fifty-three. The and untoward conduct by attorneys. strengthen FRCP 11. I believe that as a gen- total filings per judgeship, criminal and Candidly, I hope that the Senate does not eral matter, Rule 11 is a valuable tool for civil, have been lower than they were in 1991 pass the ‘‘loser pays’’ legislation. I have one judges to use, and I have occasionally im- (372) in only two years since 1975. And the comment related to strengthening of FRCP posed Rule 11 sanctions myself to punish or weighted filings per judgeship have likewise 11. Although there may be and there is some deter inappropriate behavior. However, I fur- fallen in the past five years from 461 in 1986 justification for losers pay, I do not believe ther believe that Rule 11, as it existed prior to 405 in 1992. it is necessary. There are many cases where to the 1993 amendments, had a deleterious ef- ‘‘So there is not much support for the oft- an indigent, well-intentioned litigant may be fect upon the professional relationships of repeated assertions that ‘federal court sys- penalized by strict adherence to a rule that members of the bar. Furthermore, I think tem has entered a period of crisis;’ that our losers pay. I have been a New Hampshire Su- that in its pre-1993 form the Rule was coun- courts are ‘on the verge of buckling under perior Court judge for sixteen years and a terproductive in that it increased judges’ the strain;’ that ‘our courts are swamped and Federal Judge for an equal amount of time. workloads and contributed to litigation cost unmanageable’. . . . The actual figures and While not strictly restricted to the Federal and delay by requiring judges to impose trends simply do not support such doomsday Courts, we are being inundated with paper, sanctions whenever a Rule 11 violation was hyperbole. usually by the party who is well-off finan- found. Satellite litigation in which one law- ‘‘On the issue of delay we find, as always, cially. This unfortunately sometimes puts yer or party sought fees from another be- that a few district courts are having consid- pressure on the non-affluent litigant to set- came commonplace. erable trouble moving their dockets, but tle or withdraw his or her claim. For these reasons I oppose any amendment overall we find the same median time from Sincerely, to the Rule that would make imposition of filing to disposition in civil cases (nine MARTIN F. LOUGHLIN. sanctions mandatory; to a somewhat lesser months) for each year from 1985 until 1992. extent, I also oppose elimination of the And the period between issue and trial in U.S. DISTRICT COURT, Rule’s ‘‘safe harbor’’ provision provided in 1992 (fourteen months) is the same as it was SOUTHERN DISTRICT OF NEW YORK, the 1993 amendments. in 1985. A Rand Corporation study confirms New York, NY, May 10, 1995. I hope that these comments are helpful to that the rhetoric about unconscionable and Hon. ARLEN SPECTER, you. If I can be of any further assistance, escalating delays in processing and trying U.S. Senate, Committee on the Judiciary, please do not hesitate to contact me. cases in the federal district court system is Washington, DC. Sincerely, nothing more than myth. . . .’’ DEAR SENATOR SPECTER: Thank you for J. FREDERICK MOTZ, In other words, the sky is not falling down. your letter dated April 24 inquiring about United States District Judge. Again, thank you very much for permit- frivolous litigation in the federal courts. I ting me to comment on these questions. have been a federal trial judge for nine and U.S. COURT OF APPEALS Cordially, one-half years in one of the busiest districts FOR THE SEVENTH CIRCUIT, WM. R. WILSON, JR. in the country. During that period, Chicago, IL, April 19, 1995. Fed.R.Civ.P. 11 has been both strengthened Senator ARLEN SPECTER, U.S. DISTRICT COURT, and weakened. I have not observed a signifi- U.S. Senate, Committee on the Judiciary, NORTHERN DISTRICT OF ILLINOIS, cant problem that requires a legislative rem- Washington, DC. Chicago, Illinois, May 5, 1995. edy. DEAR SENATOR SPECTER: Thank you for Senator ARLEN SPECTER, The only noticeable effect of the weaken- your letter requesting my views on the U.S. Senate, Committee on the Judiciary, ing of FED.R.Civ.P. 11 has been a welcome ‘‘loser pays’’ and Rule 11 issues. I very much Washington, DC. diminution in the number of Rule 11 mo- appreciate being given an opportunity to DEAR SENATOR SPECTER: I respond to yours tions. With respect to ‘‘loser pays,’’ it is my comment. My thoughts on the specific ques- of April 19 inquiring about the need to strongly-held view that the founders of this tions you pose are as follows: strengthen Rule 11 of the Federal Rules of Republic wisely chose to eliminate certain (1) In my judgment, there is no significant Civil Procedure. problem with frivolous litigation in the fed- 1. In my 22 years on the federal trial bench aspects of the English legal system as con- eral courts such as would justify ‘‘loser I state unequivocally that there is not a sig- trary to the egalitarian ideals of American pays’’ legislation or strengthening FRCP 11. nificant problem with frivolous litigation in democracy. Two of the most important of The current Rule 11 gives the district court the federal courts warranting a ‘‘loser pays’’ these reforms were the abolition of the dis- ample discretion to address frivolous litiga- sanction. I have encountered two or three tinction between barristers and solicitors repetitious/abusive plaintiffs. But their first and the elimination of the British practice of tion. If a given case is sufficiently frivolous, complaints were not frivolous. They just had requiring the losing party in civil litigation a court is not hampered from invoking Rule difficulty taking ‘‘No’’ for an answer. to pay the lawyers fees of the winning party. 11 to shift the entire cost of the case to the Of course, in all litigation which is tried, Indeed, the system of having each party bear loser. Rule 11 also grants the district court somebody wins and somebody loses. But the its own legal fees has come to be known as discretion to impose more modest penalties losers are not frivolous complainers. the American Rule. It is based on the belief or to refrain from a penalty, depending on 2. The 1993 amendment to Rule 11 of the that people of limited means would be de- what is appropriate in a given case. Federal Rules of Civil Procedure did not terred from suing on meritorious claims by (2) After the 1983 amendment, FRCP 11 cre- ‘‘weaken’’ it. Quite the contrary: it made the the fear that if they were not successful, the ated a cottage industry of satellite litigation Rule bilateral, i.e., it applies to unfounded costs would ruin them. which consumed an enormous amount of denials as well as unfounded contentions; it I have found the general supervisory power court time and did not succeed in improving gives the judge greater flexibility in the im- of the court as well as 38 U.S.C. § 1927 and the overall quality of litigation. The fact position of sanctions; it affords the offending Rule 11 adequate sources of judicial author- that penalties were mandatory if a violation party the opportunity to correct his or her ity to discourage frivolous litigation, and do was found simply raised the stakes of Rule 11 misdeed. The rule should not revert to 1983. not believe that the American Rule should litigation and encouraged the filing of re- 3. I suggest that Rule 11 be left just the be abolished. quests for sanctions, even if the breach was way it is. It is working well. The collateral Sincerely, slight and the damage minimal. In many litigation provoked by the 1983 version has MIRIAM GOLDMAN CEDERBAUM. cases, it turned a dispute between the liti- diminished. gants into a dispute between the lawyers, Respectfully yours, UNITED STATES DISTRICT COURT, and hampered or prevented altogether the PRENTICE H. MARSHALL. DISTRICT OF MARYLAND, pre-trial settlement of cases. The 1993 Baltimore, Maryland, May 9, 1995. amendment has improved matters greatly by UNITED STATES DISTRICT COURT, Hon. ARLEN SPECTER, making sanctions discretionary. This per- DISTRICT OF NEW HAMPSHIRE, U.S. Senate, Committee on the Judiciary, mits much greater flexibility and has re- Concord, NH, May 2, 1995. Washington, DC. moved the incentive to file Rule 11 motions Hon. ARLEN SPECTER, DEAR SENATOR SPECTER: Thank you for when the case for sanctions is weak. U.S. Senate, Committee on the Judiciary, your letter of April 19, 1995, in which you so- (3) I strongly recommend that Congress Washington, DC. licit my views on a ‘‘loser pays’’ rule and the leave Rule 11 as is and not adopt the ‘‘loser DEAR SENATOR SPECTER: This is to ac- possible strengthening of FRCP 11. pays’’ rule. A ‘‘loser pays’’ provision will not knowledge receipt of your letter dated April There is, of course, a fair amount of frivo- add anything substantive to the district 24, 1995 with respect to the recently passed lous litigation in the federal courts. How- court’s arsenal of tools to deal with frivolous United States House of Representatives leg- ever, the bulk of that litigation is conducted litigation. It is likely merely to discourage islation providing for a form of ‘‘loser pays.’’ by impecunious litigants as to whom a litigants with limited resources to pursue In response to question #1, I do not believe ‘‘loser pay’’ rule would have no effect. Ac- their cases, particularly when the litigant there is a significant problem with frivolous cordingly, I do not support the adoption of seeks a change in the law. The ability to pur- litigation in the Federal Courts to justify such a rule. I particularly oppose the rule in sue such cases seems to me one of the fun- ‘‘loser pays.’’ diversity cases since it would provide in such damental protections of individual rights in S 9168 CONGRESSIONAL RECORD — SENATE June 27, 1995

this country, and I believe if we want to re- there were frequent occasions of overuse. U.S. DISTRICT COURT, duce litigation, rather than disincentives for That overuse no longer appears. Rarely is WESTERN DISTRICT OF ARKANSAS, pursuing novel theories we ought to intro- there a need for Rule 11 sanctions of any sig- Fort Smith, AR, April 20, 1995. duce incentives for settlement. ‘‘Loser pays’’ nificant amount. Re: Your Letter of April 6, 1995. would act as a disincentive to settlement by Senator ARLEN SPECTER, 3. I suggest that Congress stay out of this introducing the question of fees and costs U.S. Senate, Committee on the Judiciary, Wash- area. What is pushing the Congress now is into settlement discussions. It would also ington, DC. the better heeled part of society. More de- generate an enormous amount of fees litiga- DEAR SENATOR SPECTER: With respect to fendants win in court than plaintiffs. ‘‘Loser tion. The net effect would thus be delete- your request for comment, I would make the pays’’ and a stricter FRCP 11 would discour- rious to individual liberties without signifi- following observations: age otherwise potentially meritorious cases cantly reducing the amount of litigation, (1) Is there a significant problem with friv- from coming to federal courts. and would in my judgment merely exacer- olous litigation in the Federal Courts such bate the core problem—the amount of time Lastly, published statistics show a 14% as to justify ‘‘loser pays’’ and strengthening that judges are increasingly required to de- drop in the number of civil filings in federal of FRCP 11? vote to non-substantive matters. courts between 1985 and 1994. Why all the ex- Response: I cannot speak for all federal Thank you again for inviting me to com- citement? courts but, with respect to those with which ment. I hope that my thoughts will be of aid Sincerely yours, I am involved, the answer is ‘‘no.’’ to you in your deliberations, and I send, as AVERN COHN. (2) How well did FRCP 11 work after the always, warmest good wishes and my thanks 1983 Amendment, which strengthened the for your many kindnesses through the years. U.S. DISTRICT COURT, rule, and since the 1993 Amendment, which With best regards, EASTERN DISTRICT OF LOUISIANA, weakened the rule? ILANA DIAMOND ROVNER. New Orleans, LA, May 1, 1995. Response: I did not commence my duties as Hon. ARLEN SPECTER, a federal district judge until April 15, 1992. U.S. COURT OF APPEALS, U.S. Senate, Committee on the Judiciary, Wash- Accordingly, I don’t feel qualified to make EIGHTH CIRCUIT, ington, DC. an appropriate comment on this issue. Kansas City, MO, April 20, 1995. (3) What suggestions, if any, do you have in Re FRCP 11. DEAR SENATOR SPECTER: This is in response relation to this issue? Hon. ARLEN SPECTER, to your letter of April 19th, which I assume Response: I am not sure the Congress needs Committee on the Judiciary, U.S. Senate, Wash- went to all members of the judiciary (unless to pass any legislation. I think courts, them- ington, DC. our mutual good friend, Ed Becker, sug- selves, can handle this matter with the rules DEAR SENATOR SPECTER: In reply to your gested that you write to me). already in place and their inherent powers. letter of April 6, positing inquiry on three is- Let me say at the outset that after having Respectfully, sues related to FRCP 11, I would like to re- been a lawyer who practiced principally in JIMM LARRY HENDREN. spond as follows: federal courts for some 26 years and a United 1. There is a significant problem with friv- States District Judge for nearly 12 years, I U.S. COURT OF APPEALS olous litigation in the Federal Courts. I support some form of ‘‘loser pay’’ legislation. FOR THE THIRD CIRCUIT, think a trial run with ‘‘loser pays’’ proposal Newark, NJ, April 24, 1995. would be in order provided the district judge There is indeed a problem with frivolous Hon. ARLEN SPECTER, would have the discretion to apply or not to litigation in the Federal Courts which, in my U.S. Senator, Committee on the Judiciary, apply such sanction in any given case. view, justifies some form of ‘‘loser pay’’ rule. Washington, DC. 2. I think FRCP 11 worked better after the ‘‘Loser pay’’ legislation would serve as a de- DEAR SENATOR SPECTER: Your letter of 1983 Amendment; and, has some difficulty terrent to many lawsuits that ought not be April 6th asks for my comments respecting since the 1993 Amendment. filed, including suits by lawyers and pro se congressional proposals to strengthen Rule 3. I believe more discretion should be given litigants. Moreover, ‘‘loser pay’’ legislation to the district judge in the how and when to 11 and to enact ‘‘loser pays’’ legislation. I am would also deter frivolous defenses in the pleased to respond to your inquiries as best apply the sanctions authorized under FRCP early stages of the litigation. That, to me, is 11(c) on sanction. Also, some revisions of I can. the main difference between ‘‘loser pay’’ and The 1983 amendment to Rule 11 generated a subsection (d) might be in order relating to Rule 11. discovery as there has been many abuses re- rash of Rule 11 motions, which themselves ported of extensive, unnecessary and costly I believe Rule 11 has worked after the 1983 often generated responding Rule 11 motions. discovery procedures which makes the whole Amendment, but its weakness is that Rule 11 These motions were frequently groundless. legal system too expensive for many citizens addresses matters that might have occurred According to a 1989 Federal Judicial Center to handle or even participate in the legal at the outset of litigation but that usually (FJC) survey, approximately 31 percent of process. occur as an abuse of the adversary process in judges believed that many or most Rule 11 I have been sitting with the Ninth Circuit a later stage of the litigation. On the other motions for sanctions are themselves frivo- in San Francisco since the receipt of your hand, ‘‘loser pay’’ would serve as a deterrent lous. Federal Judicial Center, Rule 11: Final letter, hence my slight delay in reply. from the very beginning of the litigation. I Report of the Advisory Committee on Civil Sincerely, haven’t had much involvement with Rule 11 Rules § 2A at 7 (1990). Indeed, the post-1983 FLOYD R. GIBSON. since the 1993 Amendment, but I believe that Rule 11 jurisprudence gave rise, in my opin- giving district courts more discretion in ap- ion, to tangential ‘‘satellite’’ proceedings U.S. DISTRICT COURT, plying the Rule was a good thing and I would which, in many instances, not only delayed EASTERN DISTRICT OF MICHIGAN, not consider the 1993 Amendment to have but appeared to dwarf the controversy on the Detroit, MI, May 5, 1995. been a weakening of the Rule. merits. I make special reference here to the prac- Hon. ARLEN SPECTER, As to specific suggestions, ‘‘loser pay’’ tice of counsel who file a Rule 11 motion in U.S. Senate, Committee on the Judiciary, Wash- comes in many forms as you no doubt are an attempt to recover fees, which is met ington, DC. aware. I don’t have a specific model in mind, DEAR SENATOR SPECTER: Thank you for with a Rule 11 motion by adversary counsel, only a concept. I like the English rule but claiming that the initial Rule 11 motion was asking my views on pending ‘‘loser pays’’ they have a much more sophisticated Legal legislation. itself frivolous. According to the Judicial Aid system. The question of whether or not Center, the majority of judges (and I count I firmly believe the Congress involves it- pro se litigants should be dealt with the self too deeply in the procedural aspects of myself among them) believe that the possi- same way as lawyers and other litigants is a bility of ‘‘dueling’’ Rule 11 motions can the litigation process. Federal judges are ca- close call. I guess what I am saying is that pable of dealing with abusive lawyering. Leg- make litigation even more contentious if the there are several models of ‘‘loser pay’’ and threat of cost shifting materializes. Id. § 2A islation is not needed. I handle my docket your Committee would no doubt want to just fine. I control abusive lawyering within at 10. Further, judicial time spent defining consider many of them and, perhaps, even a what is ‘‘frivolous’’ and resolving arguments the existing rules. Giving me more authority refinement of them that would accommodate to deal with abusive lawyering is likely to over the appropriate fee award, allowable the Federal system. But some form of ‘‘loser costs, and the like deprives judges of time make me more abusive. pay’’ is most appropriate now and I would be Specifically, which they could otherwise devote to the pleased to work with any group who was in- 1. There is no problem with frivolous liti- merits of other matters. terested in drafting such legislation. gation in the federal courts. FRCP 11 does Additionally, about 65 percent of judges be- not need to be strengthened and ‘‘loser pays’’ Thank you very much for writing me. You lieve that frivolous litigation represents a is not justified. We have gotten along very may also be interested to know that one of small or very small problem, accounting for well for 220 years without much fee shifting my present law clerks is Marc DuBois, whose only 1–10 cases per judge in a year. Id. § 2A at and there is no need for it now. father I understand is also a close friend of page 2–3. In combination, these statistics 2. FRCP 11 worked less well after the 1983 yours. suggest to me that the 1983 version of Rule 11 Amendment than it has since the 1993 Sincerely, itself may have contributed to needless pro- Amendment. After the 1983 Amendment MARTIN L.C. FELDMAN. ceedings in the courts. June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9169 The 1993 Amendment, of course, altered may be discouraged from filing meritorious rule is not practical for the United States for Rule 11 so that district court judges may ex- complaints due to fears that they will be as- several reasons: (1) it impacts everyone, ercise their discretion over whether to im- sessed ‘‘shifted’’ fees in excess of their abil- plaintiff and defendant alike, on the basis of pose sanctions. Further, it explicitly pro- ity to pay. risk averseness, not frivolity, i.e. perfectly vides for the option of penalties (fines) paid You have asked what suggestions I have non-frivolous cases are lost every day and it to the court in lieu of attorney’s fees, and in- with respect to these issues. I would retain makes no sense to punish defendants or corporates a 21 day ‘‘safe harbor’’ provision. the 1993 Amendment to Rule 11 in its present plaintiffs for losing a case; (2) a loser-pays Each provision reduces the likelihood that form and revisit the effect of the Amend- rule, unless carefully drafted, would under- attorneys will fine Rule 11 motions to shift ment at some future time, perhaps in an- mine contingent fee practice and over 100 costs while still permitting judges to target other five years. Because Federal Rule of federal fee-shifting statutes, and (3) to the violators with appropriate sanctions aimed Civil Procedure 11 and Federal Rule of Ap- extent it works in England, it is made pos- at deterring future frivolous proceedings. pellate Procedure 38 give the courts power to sible by legal aid which pays attorneys fees In my opinion, abandoning mandatory sanction frivolous actions when necessary, for lower income litigants and exempts them sanctions and permitting district court my inclination is not to remove that discre- from the rule. judges to exercises their judicial discretion tion, but to encourage it. A more constructive approach is to amend was a welcome measure. Some frivolous liti- I am similarly conservative as to ‘‘loser FRCP 68 to provide for fee-shifting offers of gation will always exist, and judges should pays.’’ I note that even in Great Britain judgment but in a way that will make the have the power and discretion to address there has been recent criticism, both in the rule serve as an incentive, not as a sanction. such behavior. After experience on the dis- press and among scholars, of the English If you are interested in this, I refer you to trict court and more than twenty years ex- Rule. My experience tells me that ‘‘each side the enclosed copies of an article I published amining district court records on appeal, I pays’’ has resulted in a just balance of inter- on the subject and of a letter I wrote re- am confident that district court judges ests. I am also a firm believer in the old cently to Senator Hatch. through the exercise of their discretion can adage. ‘‘if it ain’t broke, don’t fix it.’’ I (2) How well did FRCP 11 work after the control the evil that Rule 11 was originally therefore recommend against abandoning 1983 Amendment, which strengthened the promulgated to cure. This is the same power our present system until such time as stud- rule, and since the 1993 Amendment, which and discretion which we in the Courts of Ap- ies of the two system reveal the desirability weakened the rule? peal exercise over litigants through Federal of change. The Federal Judicial Center undertook a Rule of Appellate Procedure 38. I am certain that you and your office have study of the operation of the 1983 amend- I am also of the opinion that there has not considered all of the matters that I have ment. It showed, among other things, that been sufficient time since the 1993 Amend- written about before receiving this note, but Rule 11 activity occurred only rarely (in 2 ment has gone into effect to assess the insti- I did want to respond and explain to you why percent of the cases) and that sanctions were tutional and judicial problems that may I entertain the views that I have advanced imposed in only about a quarter of the af- have arisen. I think that before further with respect to Rule 11 and ‘‘loser pays’’ leg- fected cases, that eighty percent of the amendment to Rule 11 is sought, or further islation. Certainly, I would be pleased to re- judges thought that its overall effect was legislation in this area is contemplated, spond to any inquires you may have. positive but also that it had a potential for there should be a period for judicial matura- Thank you writing to me in this regard. causing satellite litigation and exacerbating tion, study and evaluation. Sincerely, relations among lawyers, and that the rule In this regard, let me state a final concern LEONARD I. GARTH. probably had a disparate impact on plain- that I have with the proposed congressional tiffs, particularly in civil rights cases. This changes to the Federal Rules. The procedure San Francisco, CA, May 1, 1995. is discussed in some detail in the enclosed for Rule amendments provided in the Rules Hon. ARLEN SPECTER, article. Enabling Act—consideration by committees, U.S. Senate, Committee on the Judiciary, Wash- While I believe that on the whole the 1983 the Judicial Conference, and the Supreme ington, DC. rule worked well, there is wide agreement Court followed by submission to Congress— DEAR SENATOR SPECTER: This letter re- among bench and bar that the 1993 amend- represents a prudent and conservative allo- sponds to yours of April 19 posing the follow- ment is an improvement and ought to be cation of rulemaking authority between the ing questions relating to legislation that given a chance to operate before further judiciary and Congress. I am concerned that would amend Rule 11 of the Federal Rules of changes are considered. The rule, as amend- the initiation of rule changes by Congress Civil Procedure. ed, will preserve the incentive for lawyers to without study and input from the judiciary, (1) Is there a significant problem with friv- use care in filing pleadings while minimizing and without a developmental process involv- olous litigation in the Federal Courts such costly and unproductive satellite litigation ing the bench and bar, risks overlooking rel- as to justify ‘‘loser pays’’ and strengthening over sanctions by making sanctions discre- evant considerations. Moreover, the ever- of FRCP 11? tionary (which in practical effect they are present separation of powers problems which The short answer is that there is no signifi- anyway), by providing a safe harbor, and by lurk in the background of congressional at- cant problem with frivolous litigation in the lessening the emphasis on the rule as a fee tempts to fashion procedural rules for the federal courts. To the extent there is frivo- shifting device. The amendment will mod- Federal Courts suggests that Rules such as lous litigation, it consists mostly of cases erate what on occasion had become excessive Rule 11 should be processed through tradi- brought by prisoners. Existing law ade- reliance on the rule. The amendment now tional judicial channels before congressional quately enables judges to dismiss those cases pending in Congress will inevitably result in action is taken. summarily with a minimum of work. And more expense and delay by stimulating Rule As for my thoughts on the ‘‘loser pays’’ as- neither Rule 11 nor fee shifting would have 11 litigation without giving any assurance pect of the Attorneys Accountability Act, I any impact on prisoners filing cases. that the people who are prone to file frivo- will be brief. It is clear to me that the pri- More generally, it is a misconception to lous cases will be deterred from doing so. I mary results of such legislation can only be look at Rule 11 or fee shifting as a way to believe that the amendment will be counter- to (1) reduce the number of cases that go to deter frivolous litigation. On the whole, Rule productive and self-defeating and therefore trial, and (2) spur plaintiffs to take lower 11 has had a beneficial impact in making recommend that Congress leave the rule settlements than they would otherwise have lawyers more careful about the pleadings alone and observe its operation for a few accepted. However, this is just my opinion they file, i.e. encouraging them to take a years. and it is not based on empirical data. closer look to see whether a particular plead- I note, for instance, that the Proposed ing is justified. Most frequently its applica- Sincerely, Long Range Plan for the Federal Courts, in tion has been to motions and other proce- WILLIAM W. SCHWARZER. its March 1995 publication, recognizes that dural activities rather than to complaints or Mr. BENNETT. Mr. President, as I ‘‘appropriate data are needed to assess the answers. But if it has been a deterrent at all, have said earlier in this debate, I am potential impact of fee and cost shifting on its impact has been mostly on persons who unburdened with the blessing of having users of the Federal Courts.’’ Id. at 61. The are risk averse-persons who may not want to been to law school, and as a con- take a chance that a borderline case will be Plan rejects the ‘‘English’’ rule but rec- sequence feel myself inadequate to re- ommends continuing a study of the problem found to be in violation of Rule 11 leading to of fee shifting to decrease frivolous or abu- possible sanctions. In this way, it functions spond to the learned legal arguments of sive litigational conduct. I share those not so much as a filter based on frivolity but one of the Senate’s best lawyers. As a views. as a gauge of risk averseness. I believe that consequence, Mr. President, I will I am generally of the opinion that the it has functioned in this way in very few leave that argument to be made by the American Rule is consonant with our tradi- cases but the civil rights bar believes that it chairman of the committee at some fu- tion of liberal access to the courts. I have al- has deterred filing of some civil rights cases. ture point. I have no response at this ways taken great pride in the fact that in On the question of whether there is a jus- time. our country, plaintiffs with legitimate tification for what you call a ‘‘loser pays’’ claims may have their ‘‘day in court’’ with- rule, in my view fee shifting has little to do Mr. SPECTER. Mr. President, I ask out fear of sanctions should their suits prove with control of frivolous litigation. There unanimous consent that the amend- unsuccessful. I am also concerned that public are of course various ways in which to ap- ment be set aside so that I may proceed interest groups and civil rights claimants proach fee shifting. The so-called English to offer my second amendment. S 9170 CONGRESSIONAL RECORD — SENATE June 27, 1995 The PRESIDING OFFICER. Without tion of any party, that a particularized dis- Mr. BENNETT. I will concede that objection, it is so ordered. covery is necessary to preserve evidence or this Senator is not prepared to mount prevent undue prejudice to that party. AMENDMENT NO. 1484 that response. I suggest, Mr. President, (Purpose: To provide for a stay of discovery It is more than a little surprising, that the Senator proceed in his schol- in certain circumstances, and for other Mr. President, to find securities litiga- arly and learned way. purposes) tion separated out from all of the other Mr. SPECTER. It is a little difficult Mr. SPECTER. Mr. President, I send litigation in the Federal courts. And to proceed, Mr. President, without op- an amendment to the desk and ask for for those who may be watching this position. But permit me at this time, its immediate consideration. matter on C–SPAN, while this may be Mr. President—and may I note ascen- The PRESIDING OFFICER. The viewed as somewhat esoteric, some- sion to power of my distinguished col- clerk will report. what hypertechnical, it will not be league from Pennsylvania, Senator The bill clerk read as follows: hypertechnical if you are a stockholder SANTORUM. The Senator from Pennsylvania [Mr. SPEC- and the stock goes down and you find Mr. President, in the absence of a TER] proposes an amendment numbered 1484. you have been misled and defrauded by reply, I would ask unanimous consent Beginning on page 108, strike line 24 and people who have made misrepresenta- to proceed with the third amendment all that follows through page 109, line 4, and tions. which I propose to offer. insert the following: What this means in common par- The PRESIDING OFFICER (Mr. ‘‘(k) STAY OF DISCOVERY.— lance, common English, is that a law- ‘‘(1) IN GENERAL.—In any private action SANTORUM). Without objection, the arising under this title, the court may stay suit is started. It is a class action pending amendment is set aside. discovery upon motion of any party only if started, and this private right of action AMENDMENT NO. 1485 has been developed in order to protect the court determines that the stay of discov- (Purpose: To clarify the standard plaintiffs ery— shareholders, especially small share- must meet in specifying the defendant’s ‘‘(A) would avoid waste, delay, duplication, holders who band together in a class, state of mind in private securities litiga- or unnecessary expense; and and after the complaint is filed the tion) ‘‘(B) would not prejudice any plaintiff. plaintiffs’ attorney seeks to find out ‘‘(2) ADDITIONAL LIMITATIONS ON DISCOV- Mr. SPECTER. Mr. President, I now the details as to what happened with ERY.—In any private action arising under send a third amendment to the desk this title— the defendant; the plaintiff does not and ask for its immediate consider- ‘‘(A) prior to the filing of a responsive know all the details of the facts at the ation. pleading to the complaint, discovery shall be time of filing suit. The corporation or The PRESIDING OFFICER. The limited to materials directly relevant to the officers may have made some very clerk will report the amendment. facts expressly pleaded in the complaint; and fine promises which sounded very good The bill clerk read as follows: ‘‘(B) except as provided in subparagraphs when the promises were made but no (A) and (B), or otherwise expressly provided The Senator from Pennsylvania [Mr. SPEC- in this title, discovery shall be conducted one can tell about the details of the TER] proposes an amendment numbered 1485: pursuant to the Federal Rules of Civil Proce- facts unless you go into the records of On page 110, strike lines 12 through 19, and dure.’’. that party because those facts are not insert the following: On page 111, strike lines 1 through 7, and generally known. ‘‘(b) REQUIRED STATE OF MIND.— insert the following: In lawsuits, discovery is permitted ‘‘(1) IN GENERAL.—In any private action ‘‘(2) STAY OF DISCOVERY.— where one party seeks to take the dep- arising under this title in which the plaintiff ‘‘(A) IN GENERAL.—In any private action osition, that is, to ask the other party may recover money damages only on proof that the defendant acted with a particular arising under this title, the court may stay questions, or propounds interrog- discovery upon motion of any party only if state of mind, the complaint shall, with re- the court determines that the stay of discov- atories, that is, submits written ques- spect to each act or omission alleged to vio- ery— tions, or makes a motion for the dis- late this title, specifically allege facts giving ‘‘(i) would avoid waste, delay, duplication, covery of documents to take a look at rise to a strong inference that the defendant or unnecessary expense; and records. acted with the required state of mind. ‘‘(ii) would not prejudice any plaintiff. In discussing this issue with the pro- ‘‘(2) STRONG INFERENCE OF FRAUDULENT IN- ‘‘(B) ADDITIONAL LIMITATIONS ON DISCOV- ponents of the legislation, I was given TENT.—For purposes of paragraph (1), a ERY.—In any private action arising under a response—it is a little disappointing strong inference that the defendant acted with the required state of mind may be es- this title— not to find somebody to argue against ‘‘(i) notwithstanding any stay of discovery tablished either— issued in accordance with subparagraph (A), here. It is not easy to make an argu- ‘‘(A) by alleging facts to show that the de- the court may permit such discovery as may ment when there is nobody to disagree. fendant had both motive and opportunity to be necessary to permit a plaintiff to prepare Perhaps my distinguished colleague commit fraud; or an amended complaint in order to meet the from Iowa wishes to disagree with me. ‘‘(B) by alleging facts that constitute pleading requirements of this section; My distinguished colleague from Utah strong circumstantial evidence of conscious ‘‘(ii) prior to the filing of a responsive chooses not to. misbehavior or recklessness by the defend- pleading to the complaint, discovery shall be The response I got was that it ant. limited to materials directly relevant to changes the mindset of the litigation, Mr. SPECTER. Mr. President, I facts expressly pleaded in the complaint; and thank the clerk. I sense that the clerk ‘‘(iii) except as provided in clauses (i) and and I would say that the trial judge (ii), or otherwise expressly provided in this who is sitting on the spot has ample was surprised I had not asked unani- title, discovery shall be conducted pursuant discretion, if it is inappropriate discov- mous consent and permitted the clerk to the Federal Rules of Civil Procedure. ery, to say the discovery is not going to read the amendment. But I did so Mr. SPECTER. Mr. President, this is to go on, instead of having a manda- just for a change of scene on C–SPAN2. the amendment which I referred to ear- tory change singling out this legisla- Since there is nobody here to argue lier dealing with a provision of the bill tion from all other legislation. with me, at least let there be some in its current form which prohibits any Well, may I defer to my distinguished break in the action. The formulation of discovery after a motion to dismiss has colleague from Utah, who I know, hav- the amendment by my distinguished been filed, except under very limited ing warning in advance, now has had chief counsel, Richard Hertling, was as circumstances. ample opportunity to muster the legal clear and succinct as I could have ar- The general rule of Federal procedure arguments, or am I to infer that the ticulated it. is that discovery may proceed after a managers of the bill have fled the scene Mr. President, this again involves a complaint has been filed and a motion because there is nothing to be said in question which might be viewed as to dismiss has been filed unless on ap- response to the overwhelming argu- being esoteric and legalistic unless you plication by the defendant the judge ments I have presented? are someone who has lost money in the stays the discovery. Mr. BENNETT. I would not concede stock market and seek to make a re- The current bill provides as follows: that there is nothing to be said in re- covery, unless you are one of the peo- In any private action arising under this sponse to the overwhelming argu- ple who has participated in the stock title during the pendency of any motion to ments. transactions in excess of $3.5 trillion or dismiss, all discovery proceedings shall be Mr. SPECTER. Good. Will the Sen- have been among those who have stayed unless the Court finds, upon the mo- ator yield for a question or two? bought stock in the market, more than June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9171 $54 billion worth in 1993, the most re- And what the draftsmen have done is from Utah will have a response at this cent year available for statistical sum- gone to the Court of Appeals for the time, or Senator GRASSLEY will, or the mary. And what this amendment seeks second circuit, and they have drafted a Chair will—as to why the—I am just to do, Mr. President, is to amplify the type of pleading requirement which joking about that because there is no- language of the bill which imposes a was articulated by the chief judge of body here to argue with me about this. very difficult pleading burden on the the court of appeals by the name of And it may create some change in my plaintiff. Let me take just a moment or John Newman, who was a classmate of agreeing to the unanimous consent for two to say what goes on in a lawsuit. mine in law school and studied at the 2 minutes tomorrow to discuss this When somebody loses money because same one as the distinguished jurist, with the managers of the bill. they bought stock where there has Charles Clark, the chief judge. And now But the committee does say here been a misrepresentation, and that per- Judge Newman is chief judge in his that they are not adopting a new and son goes to a lawyer, they may have a place. And this required state of mind untested pleading standard. They are relatively small amount of stock, say provides that: correct. This is tested by the second $1,000 worth, or $10,000 worth, or even In any private action arising under this circuit. But the second circuit in the $100,000 worth. That is not a sufficient title, the plaintiff’s complaint shall, with re- whole series of cases has found that the sum to be able to carry forward litiga- spect to each act or omission alleged to vio- way to make this determination is late this title, specifically allege facts giving through these inferences which I have tion which is very, very costly on all rise to a strong inference that the defendant sides, so class actions are authorized added in this amendment. And the acted with the required state of mind. committee does say accurately that under the rules of civil procedure Now, that is the toughest standard where many plaintiffs can join to- this is the most stringent pleading around. And that is fine. We ought to standard around. And then the com- gether and there is a sufficient sum so move away from notice pleading and mittee says that it does not intend to that the lawsuit can be brought for- really make the plaintiff state with ‘‘codify the second circuit’s caselaw in- ward. specificity the state of mind. But when terpreting this pleading standard, al- Then the lawyer—and I have been on the Court of Appeals for the second cir- though the courts may find this body both sides, filing complaints and filing cuit handed down this very tough rule, of law instructive.’’ motions to dismiss—has to prepare a they went just a little farther and said Well, if we do not have it the way the complaint, and the complaint involves what would give rise to an inference so second circuit says you plead it, but allegations. An allegation is a state- that there would not be guessing on the only saying this is instructive, then ment of what the party represents hap- part of the plaintiffs. And this is what this bill allows courts to interpret this pened. And then there is an answer Judge John Newman, who established tougher pleading standard anyway filed by the defendant or the defendant this standard in the case of Beck ver- they choose, and courts may impose may file what is called a motion to dis- sus Manufacturers Hanover Trust Co., some standards which go far beyond miss, if the defendant makes the rep- said: what the second circuit and Judge resentation that even assuming every- These factual allegations must give rise to Newman had in mind in imposing this thing in the complaint is true, there is a ‘‘strong inference’’ that the defendants tough pleading standard. And it is one not a sufficient statement to con- possessed the requisite fraudulent intent. thing for the committee to say that stitute a claim for relief under the Fed- A common method for establishing a they are not adopting a new and eral rules, to warrant a recovery. strong inference of scienter is to allege facts untested pleading standard, but it is showing a motive for committing fraud and When these rules of civil procedure a clear opportunity for doing so. Where mo- only halfway if it does not put into the were formulated back in the 1930’s, and tive is not apparent, it is still possible to statute but leaves open the question of I had the good fortune in law school to plead scienter by identifying circumstances how you meet this standard. have the distinguished author of the indicating conscious behavior by the defend- I do wish I had the managers here to Federal Rules of Civil Procedure, ant, though the strength of the circumstan- question them about precisely what Charles E. Clark, the former dean of tial allegations must be correspondingly they have in mind. And I am going to Yale Law School who was then a judge greater. have to figure out some way, Mr. Presi- on the Court of Appeals for the Second Now, what my amendment seeks to dent, to raise this issue. Maybe I will Circuit and came to the law school to do, Mr. President, is to put into the offer this amendment in another form instruct us law students—there was statute the same things that Judge later so we can have some discussion done what was called notice pleading Newman was citing when he posed this and debate on it, because there is not so that there did not have to be any very tough standard pleading. Judge really any explanation or any way to elaborate statement as to what the Newman and the court said that the respond to or to understand what the case was about. It could be very simple. strong inference that the defendant committee has done here, because what There was a case called Jabari versus acted with the required state of mind they have done in essence is say the Durning, if my recollection is correct, may be established either: second circuit has a tough pleading where a person just scribbled some (a) alleging facts to show the defendant standard; let us take it. But when the notes on a piece of paper, went to the had both motive and opportunity to commit second circuit amplifies and says how clerk’s office and filed it. fraud, or (b) by alleging facts that constitute you meet that standard, the committee strong circumstantial evidence of conscious And the effort was made at that time says no, no, we are not going to adopt misbehavior or recklessness by the defend- that. to have a notice pleading, contrasted ant. What I am trying the do in this with a common law pleading under Now, in the committee report, which amendment is simply complete the pic- Chitty where the averments had to be accompanies this bill, the committee ture and have in the statute this stand- very, very specific. If he did not say it says this: ard so that people know what they are exactly right, you were thrown out of The Committee does not adopt a new and to do on the pleading. Now, I know my court. It was very complicated. And I untested pleading standard that would gen- colleague from Utah will have a com- can recall the early days practicing, erate additional litigation. Instead, the com- prehensive reply on this substantive going to the prothonotary in the Phila- mittee chose a uniform standard modeled issue. upon the pleading standard of the second cir- delphia Court of Common Pleas, which Mr. BENNETT. Comprehensive is in draws a smile from my learned col- cuit. Regarded as the most stringent plead- ing standard, the second circuit requires the eye of the beholder, Mr. President. league who is also a lawyer. There was Mr. SPECTER. If the Senator will no way that I could draw the complaint that the plaintiff plead facts that give rise to a ‘‘strong inference’’ of the defendant’s yield for a question? with sufficient specificity to satisfy fraudulent intent. The committee does not Can you give me in a beholder’s eye the clerks, who would take some de- intend to codify the second circuit’s caselaw what you are about to say is com- light in rejecting legal papers filed by interpreting this pleading standard, al- prehensive? young lawyers. So at any rate, this bill though courts may find this body of law in- Mr. BENNETT. I would say— seeks to have a very tough standard for structive. Mr. SPECTER. I think that question pleading. And I think that it is a good Now, I am a little bit at a loss—and may be even understandable on C- point. I know that the distinguished Senator SPAN2. S 9172 CONGRESSIONAL RECORD — SENATE June 27, 1995 Mr. BENNETT addressed the Chair. able period of time, but only that, in scrupulous lawyers and professional The PRESIDING OFFICER. The Sen- view of the lateness of the hour. plaintiffs. The companies that are the ator from Utah. Mr. DORGAN. Mr. President, I rise targets of such lawsuits are rightfully Mr. BENNETT. The issue did come today to discuss briefly my thoughts concerned about frivolous lawsuits. up. We did discuss it in the committee about the securities litigation reform Meritless cases unnecessarily divert at some length. And even though I am bill, S. 240 sponsored by Senators DODD the much-needed resources and atten- not a lawyer, I think I did follow the and DOMENICI that is being considered tion of firm personnel to defending conversation on this one. My under- on the Senate floor. these cases rather than allowing the standing —which I think is what the No one disagrees with the goals of S. companies to focus on product im- Senator has said, but I will repeat it so 240, which are to help pull the plug on provement and on their global com- that we have a common basis here—my frivolous and unmeritorious securities petitors. understanding is that there was con- fraud lawsuits and to secure greater But I think that S. 240 as drafted cern about different standards and dif- protections for those innocent victims goes too far toward immunizing those ferent circumstances. And the commit- in fraud litigation. But regrettably this who are guilty of securities violations tee decided they wanted to codify the bill, as it is currently drafted, will from liability. The provisions that standard from the second circuit. Now, make it more difficult for innocent shield these wrongdoers in securities the committee intentionally did not fraud victims to bring legitimate fraud fraud cases from liability are unfair to provide language to give guidance on cases. It also limits their ability to re- the innocent victims of fraud. And it exactly what evidence would be suffi- cover all of their losses from fraud per- sends the wrong message to our securi- cient to prove facts giving rise to a petrators in those cases that they win. ties market that fraudulent behavior strong inference of fraud. They felt For these reasons, I intend to vote no. will be tolerated, if not sanctioned. that adopting the standard would be Some of the provisions in the bill are We must not insulate the white col- sufficient. long overdue. The bill would limit un- lar crowd who would exploit unwary in- Obviously, the Senator from Penn- reasonable attorney’s fees in securities vestors for their own personal gains. sylvania disagrees with that decision. fraud cases. It also prohibits bonus Those responsible for the S&L scandal But the decision was intentional. This payments and referral fees which may and those responsible for fraud in the is not an inadvertent thing that the create an incentive to file frivolous future should pay. That’s why I will committee did. And they felt that with cases. Moreover, it requires lawyers to vote against S. 240, unless it is substan- the second circuit standard being writ- provide all plaintiffs with more infor- tially improved before the Senate votes ten into the bill, it was best to stop at mation about the nature of a proposed on final passage. that point and allow the courts then settlement in class action cases—in- Mr. HATFIELD. Mr. President, the the latitude that would come beyond cluding a statement about the reasons Private Securities Litigation Reform that point. for settlement, about an investor’s av- Act of 1995, of which I am a cosponsor, Beyond assuring the Senator that erage share of the award and the is not about aiding perpetrators of this was a deliberate decision within amount of the attorney’s fees and fraud in the financial markets or hurt- the committee by the drafters of the costs. I support all of these provisions. ing small investors. This legislation is bill, both staff and members, I probably But other provisions in the bill could about curtailing the abuses in this cannot give him any further enlight- effectively shield from liability those country’s securities litigation system ened knowledge on this particular sub- perpetrators who knowingly mislead or and empowering defrauded investors ject. defraud investors. And if there is one with greater control over the class ac- Mr. SPECTER. Mr. President, I thing that the investors of this country tion process. This legislation would re- thank my distinguished colleague for have a right to expect, it is that those store fairness and integrity to our se- that response. who commit fraud or those who sub- curities litigation system. The PRESIDING OFFICER. The Sen- stantially assist in fraud get punished This legislation assists small inves- ator from Pennsylvania. and that they are forced to return their tors by requiring lawyers to provide Mr. SPECTER. But I must say, I do ill-gotten gains to honest victims of greater disclosure of settlement terms, not understand the logic of what the their misdeeds. including reasons why plaintiffs should committee has done when they utilize In the 1980’s, a flood of S&L execu- accept a settlement. This is a common the second circuit standard which they tives openly flouted the law and the sense approach which is often lacking say is the most stringent standard, and trust of their investors and depositors. under the current system. This legisla- the second circuit is given a road map Some of them lived like maharajahs tion also incorporates public auditor as to how you meet it. while building monuments of worthless disclosure language. S. 240 requires The legislation might not say this is paper. This charade perpetrated by that independent public accountants the only way to meet it, but this is one these swindlers contributed to a bail- report to their client’s management of the ways to meet it so that when out of the industry that is costing the any illegal act found during the course somebody is drafting a pleading, a taxpayers of America as much as $500 of an audit. If the management of the party has knowledge and notice as to billion to clean up. Innocent investors company or the board of directors fail how to go about it. When the commit- were bilked out of tens of billions of to notify the Securities and Exchange tee takes credit here for not adopting a dollars and their ability to recover Committee of the illegal act, the audi- new and untested pleading standard, I their losses has been limited. tor is required to inform the SEC or give them credit, because it is some- Congress enacted tough legislation to face civil penalties. This is needed re- thing which has already been tested. It ensure that this debacle will not hap- form which assists all investors who is not new, but is incomplete if it does pen again. I recall legislation that I of- rely on accountants to act in an inde- not have the second part of what the fered, which passed Congress, prohibit- pendent manner on their behalf. second circuit said as to how you meet ing S&L’s from investing in risky junk I would like to close my statement the standard. It simply to me does not bonds and requiring them to divest the on the Private Securities Litigation follow. ones they already own. Some S&L’s Reform Act of 1995 by highlighting I shall not pursue it because I under- were actually selling worthless junk some statistics from an article in to- stand the distinguished Senator from bonds to investors out of their lobbies. day’s issue of the Wall Street Journal. Utah is not the draftsman. It never should have happened. But The article notes that the net legal Mr. President, that concludes the ar- still many unwary investors lost a bun- costs of accounting firms has increased gument, and I do not think there is any dle on junk bonds offered by these de- from 8 percent of their total revenue in point at this late hour in keeping the ceptive fast-buck artists before Con- 1990 to 12 percent of revenue in 1993. staff here if we are not going to have gress acted to stop this activity. That is a 50 percent increase in net any reply. So, Mr. President, I yield We ought to pass tough, reformed- legal costs in just 3 years. In one of the the floor. If my colleagues are here and minded securities legislation that stops cases cited in the article, it notes that intend to make some reply, if they are the abusive legal cases that are filed to an accounting firm spent $7 million de- on the premises, I will wait a reason- simply line the financial pockets of un- fending itself in a case where the jury June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9173 ruled in the accounting firms favor. Mr. President, this legislation is long ‘‘(II) requires’’. That is $7 million spent just to prove overdue. I am pleased this day has On page 115, line 4, strike ‘‘(iii) deter- mines’’ and insert the following: that the firm was innocent. As these come, and I am pleased that this re- ‘‘(III) determines’’. statistics show, common sense should form has overwhelming bipartisan sup- On page 116, between lines 11 and 12, insert be reintroduced to our securities litiga- port. the following: tion system, and this legislation does It is time we look at liability issues ‘‘(D) made in connection with an initial just that. Common sense benefits all and liability reform not on a partisan public offering; parties in the securities litigation sys- basis but on an American basis. It is in On page 116, line 12, strike ‘‘(D)’’ and insert ‘‘(E)’’. tem, especially investors, which is fun- the best interest of business and it is in On page 116, line 17, strike ‘‘(E)’’ and insert damental to this legislation. the best interest of the consumers. We ‘‘(F)’’. Ms. MIKULSKI. Mr. President, I rise can do both, because this bill does On page 118, line 13, before the period in- today to speak in support of the Secu- both. sert ‘‘that are not compensated through final rities Litigation Reform Act. I like Mr. GRASSLEY addressed the Chair. adjudication or settlement of a private ac- this bill for three reasons: It stops the The PRESIDING OFFICER. The Sen- tion brought under this title arising from ator from Iowa. the same violation’’. bounty hunters, it puts people who On page 121, line 7, strike ‘‘has been,’’. have lost money in charge, and it pe- Mr. GRASSLEY. Mr. President, I ask On page 121, strike line 9, and insert the nalizes people who commit fraud. unanimous consent to speak for 6 min- following: ‘‘made— Mr. President, we are finally moving utes as in morning business. ‘‘(i) was convicted of any felony or mis- on this issue. We’ve moved beyond dis- The PRESIDING OFFICER. Without demeanor’’. cussing whether or not there is a prob- objection, it is so ordered. On page 121, strike line 11 and insert the Mr. GRASSLEY. I thank the Chair. following: ‘‘15(b)(4)(B); or lem—to discussing exactly what re- ‘‘(ii) has been made the subject of a ju-’’. forms are needed. (The remarks of Mr. GRASSLEY per- On page 121, line 14, strike ‘‘(i) prohibits’’ Here is what I think. First, let us taining to the introduction of S. 974 are and insert the following: stop the bounty hunters. This bill says located in today’s RECORD under ‘‘(I) prohibits’’. that lawyers can’t shop around for cli- ‘‘Statements on Introduced Bills and On page 121, line 16, strike ‘‘(ii) requires’’ Joint Resolutions.’’) and insert the following: ents. I mean—a lawyer will not be able ‘‘(II) requires’’. to pay a commission to someone else to Mr. GRASSLEY. Mr. President, I On page 121, line 19, strike ‘‘(iii) deter- find them a client. suggest the absence of a quorum. mines’’ and insert the following: I have heard of instances where law- The PRESIDING OFFICER. The ‘‘(III) determines’’. yers seek out clients just so they can clerk will call the roll. On page 122, between lines 20 and 21, insert The assistant legislative clerk pro- the following: have cases to litigate. ‘‘(D) made in connection with an initial Second, I think the people who lose ceeded to call the roll. Mr. BENNETT. Mr. President, I ask public offering; the most money should have the most On page 122, line 21, strike ‘‘(D)’’ and insert to say. By that I mean—with this bill unanimous consent that the order for ‘‘(E)’’. the court will be able to pick one per- the quorum call be rescinded. On page 123, line 1, strike ‘‘(E)’’ and insert The PRESIDING OFFICER. Without son—who has lost a lot of money in a ‘‘(F)’’. objection, it is so ordered. On page 124, line 21, insert before the pe- class action suit—to be the leader. This Mr. BENNETT. Mr. President, I ask riod ‘‘that are not compensated through way the system works for investors in- unanimous consent that the pending final adjudication or settlement of a private stead of against them. amendment be set aside. action brought under this title arising from Third, Mr. President, I am all for The PRESIDING OFFICER. Without the same violation’’. ending fraud and protecting businesses On page 128, line 25, strike ‘‘the liability objection, it is so ordered. that are just trying to create jobs. This of’’ and insert ‘‘if’’. bill will not apply to people who know- AMENDMENT NO. 1486 On page 128, line 25, strike ‘‘offers or sells’’ and insert ‘‘offered or sold’’. ingly cheat investors. (Purpose: To make certain technical amendments, and for other purposes) On page 129, line 1, strike ‘‘shall be limited I have talked to several investors and to damages if that person’’. I have heard from the people of Mary- Mr. BENNETT. Mr. President, I send On page 129, line 9, strike ‘‘and such por- land on this issue. Accountants tell me an amendment to the desk and ask for tion or all of such amount’’ and insert ‘‘then that some attorneys pay stockbrokers, its immediate consideration. such portion or amount, as the case may and others, in return for information The PRESIDING OFFICER. The be,’’. On page 131, lines 19 and 20, strike ‘‘that about possible lawsuits and possible clerk will report. The assistant clerk read as follows: person’s degree’’ and insert ‘‘the percent- clients. That is unacceptable. Courts The Senator from Utah [Mr. BENNETT], for age’’. are for protecting the rights of people On page 131, line 20, insert ‘‘of that person’’ Mr. D’AMATO, for himself and Mr. SARBANES, before the comma. and promoting fairness, not for frivo- proposes an amendment numbered 1486. lous lawsuits. Mr. BENNETT. Mr. President, I ask Companies are hit with higher insur- Mr. BENNETT. Mr. President, I ask unanimous consent that reading of the unanimous consent that the amend- ance costs, time in court and are gen- ment be agreed to and that the motion erally distracted from the mission of amendment be dispensed with. The PRESIDING OFFICER. Without to reconsider be laid upon the table. creating jobs. Lawsuits mean that The PRESIDING OFFICER. Without objection, it is so ordered. companies are reluctant to provide the The amendment is as follows: objection, the amendment is agreed to. kind of public information that can So the amendment (No. 1486) was benefit investors. On page 84, line 11, strike ‘‘, if’’ and insert agreed to. ‘‘in which’’. In Maryland, high-technology compa- On page 111, beginning on line 2, strike f nies are hit the most by this problem. ‘‘during the pendency of any motion to dis- That means these unnecessary lawsuits miss,’’. MORNING BUSINESS are costing Maryland citizens—lost On page 111, line 4, insert ‘‘during the pend- Mr. BENNETT. Mr. President, I ask jobs and lost opportunities. ency of any motion to dismiss,’’ after unanimous consent that there now be a Mr. President, this is not about pro- ‘‘stayed’’. period for the transaction of routine tecting some ‘‘savings and loan con On page 114, line 13, strike ‘‘has been,’’. On page 114, strike line 15 and insert the morning business, with Senators per- artist’’ as the ads say. This bill is following: ‘‘made— mitted to speak therein for up to 5 about saving jobs and keeping the ‘‘(i) was convicted of any felony or mis- minutes each. courthouse doors open to those who demeanor’’. The PRESIDING OFFICER. Without really need to get inside. On page 114, strike line 17 and insert the objection, it is so ordered. I support this bill because I believe it following: ‘‘15(b)(4)(B); or f will create jobs. We needs investors. We ‘‘(ii) has been made the subject of a ju-’’. need new companies. We need new jobs. On page 114, line 20, strike ‘‘(i) prohibits’’ IS CONGRESS IRRESPONSIBLE? and insert the following: THE VOTERS HAVE SAID YES But we will not have any new jobs if ‘‘(I) prohibits’’. companies cannot invest or ask people On page 115, line 1, strike ‘‘(ii) requires’’ Mr. HELMS. Mr. President, the im- to invest in their future. and insert the following: pression simply will not go away: The S 9174 CONGRESSIONAL RECORD — SENATE June 27, 1995 existing $4.8 trillion Federal debt is a INTRODUCTION OF BILLS AND and for other purposes; to the Commit- sort of grotesque parallel to the JOINT RESOLUTIONS tee on Finance. engerizer bunny that appears and ap- The following bills and joint resolu- THE BEAR PROTECTION ACT pears and appears on television—the tions were introduced, read the first Mr. MCCONNELL. Mr. President, I same way that the Federal debt keeps and second time by unanimous con- introduce the Bear Protection Act. going and going and going—up, of sent, and referred as indicated: This measure is aimed at controlling course, always to the added burdens on poaching of bears such as the American By Mr. MCCONNELL: the American taxpayers. S. 968. A bill to require the Secretary of black bear which is found in Kentucky. So many politicians talk a good the Interior to prohibit the import, export, It addresses several enforcement and game—and talk is the operative word— sale, purchase, and possession of bear viscera jurisdictional loopholes that are caused about reducing the Federal deficit and or products that contain or claim to contain by a patchwork of State laws. The cur- bringing the Federal debt under con- bear viscera, and for other purchases; to the rent inconsistencies enable a wildly trol. Committee on Finance. profitable underground black market In any event, Mr. President, as of By Mr. BRADLEY (for himself, Mrs. for bear parts to flourish in the United KASSEBAUM, and Mr. ROCKEFELLER): yesterday, Monday, June 26, at the States. close of business, the total Federal S. 969. A bill to require that health plans provide coverage for a minimum hospital Mr. President, my bill would in no debt stood—down to the penny—at ex- stay for a mother and child following the way affect legal hunting of bears. Hun- actly $4,889,052,929,226.24 or $18,558.93 birth of the child, and for other purposes; to ters would still be allowed to keep tro- per man, woman, child on a per capita the Committee on Labor and Human Re- phies and furs of bears killed during basis. Res ipsa loquitur. sources. legal hunts. This measure would only f By Mrs. HUTCHISON: prohibit the sale or barter of the inter- S. 970. A bill to authorize the Adminis- nal organs of the bear which are re- MESSAGES FROM THE PRESIDENT trator of General Services to enter into ferred to as bear viscera. Messages from the President of the agreements for the construction and im- This bill is made necessary because United States were communicated to provement of border stations on the United States international borders with Canada of the booming illegal trade in bear the Senate by Mr. Thomas, one of his and Mexico, and for other purposes; to the viscera. At least 18 Asian countries are secretaries. Committee on Environment and Public known to participate in the illegal f Works. trade in bear parts. Bear viscera are By Mr. COATS (for himself, Mr. HELMS, also illegally sold and traded in large EXECUTIVE MESSAGES REFERRED Mr. GREGG, and Mr. ASHCROFT): urban areas in the United States such As in executive session the Presiding S. 971. A bill to amend the Public Health as San Francisco, Seattle, Portland, Officer laid before the Senate messages Service Act to prohibit governmental dis- and New York City. These cities serve from the President of the United crimination in the training and licensing of health professionals on the basis of the re- as primary ports for export shipments States submitting sundry nominations fusal to undergo or provide training in the of these goods. which were referred to the appropriate performance of induced abortions, and for Bear parts, such as gall bladders, are committees. other purposes; to the Committee on Labor used in traditional Asian medicine to (The nominations received today are and Human Resources. treat everything from diabetes to heart printed at the end of the Senate pro- By Mr. DASCHLE (for himself, Mr. disease. Due to the increasing demand ceedings.) INOUYE, Mr. HARKIN, Mr. HOLLINGS, for bear viscera, the population of f Mr. BINGAMAN, Mrs. BOXER, and Mr. Asian black bears has been totally an- AKAKA): nihilated over the last few years. This EXECUTIVE AND OTHER S. 972. A bill to amend title XIX of the So- has led poachers to turn to American COMMUNICATIONS cial Security Act to provide for medicaid coverage of all certified nurse practitioners bears to fill the increasing demand. I, The following communications were and clinical nurse specialists services; to the for one, will not stand by and allow our laid before the Senate, together with Committee on Finance. own bear populations to be decimated accompanying papers, reports, and doc- By Mr. INOUYE: by poachers. uments, which were referred as indi- S. 973. A bill to amend the Internal Reve- Mr. President, it is estimated that cated: nue Code of 1986 to provide for the tax treat- Kentucky has only 50 to 100 black bears EC–1130. A communication from the Sec- ment of residential ground rents, and for remaining in the wild. Black bears other purposes; to the Committee on Fi- retary of Transportation, transmitting, a once roamed free across the Appalach- draft of proposed legislation entitled ‘‘The nance. By Mr. GRASSLEY: ian mountains, through the rolling District of Columbia Emergency Highway hills of the bluegrass, all the way to Relief Act’’; to the Committee on Environ- S. 974. A bill to prohibit certain acts in- ment and Public Works. volving the use of computers in the further- the Mississippi river. Although we can- EC–1131. A communication from the Chair- ance of crimes, and for other purposes; to the not restore the numbers we once had, man of the National Labor Relations Board, Committee on the Judiciary. we can insure that the remaining bears transmitting, pursuant to law, the report f are not sold for profit to the highest under the Freedom of Information Act for bidder. calendar year 1993; to the Committee on the SUBMISSION OF CONCURRENT AND Poaching has become an astound- Judiciary. SENATE RESOLUTIONS ingly profitable enterprise. It is esti- EC–1132. A communication from the Chief Justice of the Supreme Court, transmitting, The following concurrent resolutions mated that over 40,000 bears are pursuant to law, the report of the proceed- and Senate resolutions were read, and poached in the United States every ings of the Judicial Conference; to the Com- referred (or acted upon), as indicated: year. That equals the number that are mittee on the Judiciary. By Mr. LAUTENBERG (for himself and taken by legal hunting. EC–1133. A communication from the Board Mr. BRADLEY): Mr. President, the main reason be- Members of the Railroad Retirement Board, S. Res. 142. A resolution to congratulate hind these astounding numbers is transmitting, pursuant to law, the annual the New Jersey Devils for becoming the 1995 greed. In South Korea, bear gall blad- actuarial report for calendar year 1995; to NHL champions and thus winning the Stan- ders are worth their weight in gold, the Committee on Labor and Human Re- ley Cup; considered and agreed to. sources. and an average bear gall bladder can EC–1134. A communication from the Sec- f bring as high as $10,000 on the black retary of Health and Human Services, trans- market. mitting, pursuant to law, a report entitled STATEMENTS ON INTRODUCED Currently, U.S. law enforcement offi- ‘‘Health, United States, 1994’’; to the Com- BILLS AND JOINT RESOLUTIONS cials have little power to address the mittee on Labor and Human Resources. By Mr. MCCONNELL: poaching of bears and the sale of their EC–1135. A communication from the Chair- S. 968. A bill to require the Secretary parts in an effective manner. The De- man of the Federal Election Commission, transmitting, pursuant to law, a proposal of the Interior to prohibit the import, partment of the Interior has neither relative to authorized committees of presi- export, sale, purchase, and possession the manpower nor the budget to test dential and vice presidential candidates; to of bear viscera or products that con- all bear parts sold legally in the United the Committee on Rules and Administration. tain or claim to contain bear viscera, States. Without extensive testing, law June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9175 enforcement officials cannot determine Interior to be the leading importers, export- There are several reasons why they if gall bladders or other parts have ers, or consumers of bear viscera; and state this: First, numerous health from threatened or endangered species. (2) attempt to establish coordinated efforts problems faced by newborns, such as with the countries to protect bears. This problem perpetuates the poaching dehydration and jaundice, do not ap- of endangered or threatened bears. SEC. 6. RELATIONSHIP TO STATE LAW. pear until after the first 24 hours of Nothing in this Act precludes the regula- The Bear Protection Act will estab- tion under State law of the sale, barter, offer life. Since many of these illnesses can lish national guidelines for trade in of sale or barter, purchase, or possession only be detected by health profes- bear parts, but it will not weaken any with intent to sell or barter, of bear viscera sionals, early hospital discharge can existing State laws that have been in- or products that contain or claim to contain cause these conditions to go unde- stituted to deal with this issue. My bill bear viscera, if the regulation— tected, leading to brain damage, will also instruct the Secretary of the (1) does not authorize any sale, barter, strokes, or even death. Interior and the U.S. Trade Represent- offer of sale or barter, purchase, or posses- Second, the mother can also develop ative to establish a dialog with the ap- sion with intent to sell or barter, of bear many serious health problems, includ- viscera or products that contain or claim to propriate countries to coordinate ef- contain bear viscera, that is prohibited ing pelvic infections, breast infections, forts aimed at curtailing the inter- under this Act; and and hemorrhaging. national bear trade. (2) is consistent with the international ob- Third, a 24-hour stay does not provide Mr. President, this measure is craft- ligations of the United States.∑ sufficient opportunity for the mother ed narrowly enough to deal with the to be taught basic infant-care skills poaching of the American black bear By Mr. BRADLEY (for himself, such as breastfeeding. This, combined for profit, while still ensuring the Mrs. KASSEBAUM, and Mr. with the fact that many mothers are rights of American sportsmen. I urge ROCKEFELLER): simply too exhausted to care for their my colleagues to join me in support of S. 969. A bill to require that health child 24 hours after delivery, often this much-needed legislation. plans provide coverage for a minimum leads to newborns receiving inadequate Mr. President, I ask unanimous con- hospital stay for a mother and child care and nourishment during their cru- sent that the full text of the bill be following the birth of the child, and for cial first few days of life. printed in the RECORD. other purposes; to the Committee on Let me assure you that these con- There being no objection, the bill was Labor and Human Resources. cerns are not just theoretical. A range ordered to be printed in the RECORD, as THE NEWBORNS’ AND MOTHERS’ HEALTH of anecdotal and scientific evidence in- follows: PROTECTION ACT dicates that these problems are real, S. 968 Mr. BRADLEY. Mr. President, I rise and growing. A researcher at Dart- Be it enacted by the Senate and House of Rep- today with Senator KASSEBAUM, the mouth’s medical school recently con- resentatives of the United States of America in distinguished chairwoman of the Labor cluded that newborns discharged less Congress assembled, and Human Resources Committee and than 2 days after birth are more likely SECTION 1. SHORT TITLE. Mr. ROCKEFELLER, to introduce legisla- to be readmitted for jaundice, mal- This Act may be cited as the ‘‘Bear Protec- tion which seeks to ensure that new- nutrition, and other problems. Physi- tion Act’’. born babies and their mothers receive cians across the country have noted a SEC. 2. DEFINITION OF BEAR VISCERA. adequate health care in the critical resurgence in the number of jaundiced In this Act, the term ‘‘bear viscera’’ means first few days following birth. babies they are treating. And news- the body fluids or internal organs (including Mr. President, we all know that the papers across the country in recent the gallbladder) of a species of bear. first few days after birth are a critical weeks have relayed devastating stories SEC. 3. PROHIBITED ACTS. and challenging time for both the in- about how local mothers and infants The Secretary of the Interior shall pro- fant and the mother. At this crucial hibit— have been affected by these policies. (1) the import into the United States, or stage in life, infants and their mothers Our bill seeks to counteract these export from the United States, of bear truly need the support of health care negative effects of premature dis- viscera or products that contain or claim to providers. Yet, more and more families charges by ensuring that newborns and contain bear viscera; and are finding their access to health pro- mothers receive adequate care during (2) the sale, barter, offer of sale or barter, viders at this time is being limited se- those critical first days. It does this by purchase, or possession with intent to sell or verely. requiring health insurers to allow new barter, in interstate or foreign commerce, of I say this because it is becoming mothers and their infants to remain in bear viscera or products that contain or common practice for health insurers to claim to contain bear viscera. the hospital for a minimum of 48 hours require that new mothers and their in- after a normal birth and 96 hours after SEC. 4. REPORT BY SECRETARY OF THE INTE- RIOR. fants be discharged from the hospital a caesarean section. Shorter hospital Not later than 180 days after the date of 24 hours after an uncomplicated vagi- stays are permitted provided that nei- enactment of this Act, the Secretary of the nal delivery, and 72 hours after a cesar- ther the mother nor the attending phy- Interior, in consultation with the Secretary ean section. In some parts of the coun- sician object, and that follow-up home of the Treasury, shall prepare and submit to try, the hospital stay for a normal de- health care is provided for the mother Congress a report that describes— livery is being reduced to 12 hours, and and infant. (1) how to improve the effectiveness of the there is even talk of cutting it back to To those who would argue that a 48- wildlife monitoring and inspection program of the Department of the Interior (including 6 hours. And in many cases, the mother hour stay is longer than is medically the computerized information system or any and infant receive no professional fol- necessary, I would like to point out other system of the United States Fish and low-up care at home. The American that this is a significantly shorter time Wildlife Service or the United States Cus- Medical Association has dubbled these than medical experts recommend for toms Service that records data) with respect practices ‘‘drive-through deliveries.’’ uncomplicated deliveries. In their to the importation or exportation of bear Drive-through deliveries are not sim- guidelines for caring for newborns and viscera and other bear and other wildlife ply a matter of sending home mothers mothers, the American College of Ob- body parts to and from the United States; who are often exhausted and still in stetricians and Gynecologists [ACOG] and (2) any plans of the United States Fish and pain, and who may not have adequate and the American Academy of Pediat- Wildlife Service to monitor the illegal move- social supports at home. They can also rics recommend stays of 48 hours for ment of, or commercial activity in, bear pose severe health risks for both the uncomplicated vaginal birth, and 96 viscera or other bear body parts. infant and the mother. National medi- hours following a caesarean birth—in SEC. 5. DISCUSSIONS CONCERNING TRADE PRAC- cal organizations, including the Amer- addition to the day of delivery. ACOG TICES. ican Academy of Pediatrics, the Amer- has also pointed out that there is inad- The United States Trade Representative ican Medical Association, and the equate evidence to prove that early dis- and the Secretary of the Interior shall— American College of Obstetricians and charge is safe, and therefore that the (1) discuss issues involving trade in bear viscera with the appropriate representatives Gynecologists, have all stated that the recent trend toward shorter stays of such countries trading with the United trend toward shorter hospital stays is ‘‘could be the equivalent of a large, un- States as are determined jointly by the Sec- placing the health of many newborns controlled, uninformed experiment’’ on retary of Commerce and the Secretary of the and mothers at risk. newborns and their mothers. S 9176 CONGRESSIONAL RECORD — SENATE June 27, 1995 A 48-hour minimum stay is also con- Mr. President, I ask unanimous con- the Secretary determines that such a policy sistent with steps being considered by sent that the text of the bill be printed provides sufficiently comprehensive coverage some States. For example, our bill is in the RECORD. of a benefit so that it should be treated as a health plan). very similar to one which recently was There being no objection, the bill was (H) Such other plan or arrangement as the passed unanimously by the New Jersey ordered to be printed in the RECORD, as Secretary of Health and Human Services de- Legislature, and which should soon be follows: termines is not a health plan. signed into law. Maryland has also re- S. 969 (3) CERTAIN PLANS INCLUDED.—Such term cently passed a law dealing with early Be it enacted by the Senate and House of Rep- includes any plan or arrangement not de- discharges, and similar measures are resentatives of the United States of America in scribed in any subparagraph of paragraph (2) being considered in New York and Cali- Congress assembled, which provides for benefit payments, on a periodic basis, for— fornia. SECTION 1. SHORT TITLE. (A) a specified disease or illness, or Mr. President, insurers may argue This Act may be cited as the ‘‘New Borns’ (B) period of hospitalization, that they will pay for stays beyond 24 and Mothers’ Health Protection Act of 1995’’. without regard to the costs incurred or serv- hours if there is a valid medical reason. SEC. 2. REQUIRED COVERAGE FOR MINIMUM ices rendered during the period to which the However, many physicians have told HOSPITAL STAY FOLLOWING BIRTH. payments relate. me—off the record—that it is very dif- (a) IN GENERAL.—A health plan that pro- SEC. 3. EFFECTIVE DATE. vides maternity benefits, including benefits The provisions of section 2 shall apply to ficult to convince insurers to grant an for child birth, shall ensure that coverage is extension, no matter how valid the rea- all health plans offered, sold, issued, or re- provided for a minimum of 48 hours of in-pa- newed after the date of enactment of this son. They also state that the final deci- tient care following a vaginal delivery and a Act. sion is often made by someone with no minimum of 96 hours of in-patient care fol- Mrs. KASSEBAUM. Mr. President, I lowing a caesarean section for a mother and ∑ experience in obstetrics. Finally, they join today with my colleague from New state that many doctors are under fi- her newly born child in a health care facil- Jersey, Senator BRADLEY, in introduc- nancial pressures to avoid having pa- ity. (b) EXCEPTION.— ing the Newborns’ and Mothers’ Health tients stay beyond the 24-hour limit, so (1) IN GENERAL.—Notwithstanding sub- Protection Act of 1995. they are faced with a real quandary section (a), a health plan that provides cov- This legislation seeks to ensure that when a patient needs an extension. A erage for post-delivery care provided to a adequate care is provided to mothers recent report by Maryland’s Depart- mother and her newly born child in the home and newborns in the critical first few ment of Health and Mental Hygiene shall not be required to provide coverage of days following birth. Modeled after leg- raises further concerns about what is in-patient care under subsection (a) unless such in-patient care is determined to be islation recently considered in Mary- considered a valid medical reason. This land and passed unanimously by the report found that among babies who medically necessary by the attending physi- cian or is requested by the mother. New Jersey Legislature, it requires were born prematurely, who were not (2) ATTENDING PHYSICIAN.—For purposes of health insurers to allow new mothers fully developed, or who were diagnosed paragraph (1), the term ‘‘attending physi- and their infants to remain in the hos- with a significant problem, about 22 cian’’ shall include the obstetrician, pedia- pital for a minimum of 48 hours after a percent were discharged from the hos- trician, or other physician attending the normal birth, and 96 hours after a ce- pital within 24 hours of birth. This mother or newly born child. (c) PROHIBITION.—In implementing the re- sarean delivery. If the mother and the study was based on data from 1992. I doctor agree, shorter hospital stays are can only assume that the situation has quirements of this section, a health plan may not modify the terms and conditions of permitted, provided that there is a fol- gotten worse in the 3 years since. coverage based on the determination by an low-up visit. Mr. President, there is no greater ad- enrollee to request less than the minimum ‘‘Guidelines for Perinatal Care’’ is- vocate for controlling health care costs coverage required under subsection (a). sued by the American Academy of Pe- than this Senator. And I am impressed (d) NOTICE.—A health plan shall provide diatrics [AAP] and the American Col- by some health insurers’ success in notice to each enrollee under such plan re- lege of Obstetricians and Gynecologists slowing health inflation by reducing garding the coverage required by this section in accordance with regulations promulgated [ACOG] state that in uncomplicated de- unnecessary care. At the same time, I liveries the postpartum hospital stay also recognize that there is a very fine by the Secretary of Health and Human Serv- ices, in consultation with the National Asso- should range from 48 hours for vaginal line between eliminating unnecessary ciation of Insurance Commissioners. Such births to 96 hours for cesarean sections, care and reducing access to care which notice shall be in writing and prominently exclusive of the day of delivery. truly is needed. And when we end up on positioned in any literature or correspond- However, as hospitalization costs the wrong side of that line—as I think ence made available or distributed by the continue to climb, it has become in- is happening in the case of newborns health plan and shall be transmitted— creasingly common for health insurers (1) in the next mailing made by the plan to and their mothers—I believe it is both to require that new mothers and their appropriate and necessary for us to the employee; (2) as part of the yearly informational babies be discharged from the hospital take steps to protect the health of the packet sent to the enrollee; or 24 hours after birth. In some parts of American public. Concerns about con- (3) not later than January 1, 1996; the country, hospital stays for a rou- trolling costs are justified, but they whichever is earlier. tine delivery can be as short as 12 must not be allowed to outweigh con- (e) HEALTH PLAN.— hours. cerns about doing what is best for pa- (1) IN GENERAL.—As used in this Act, the The American Medical Association tients. And let us not forget, Mr. Presi- term ‘‘health plan’’ means any plan or ar- [AMA], ACOG, and the Academy of Pe- rangement which provides, or pays the cost dent, that discharging mothers and diatrics all have stated that the trend newborns early creates its own costs, of, health benefits. (2) EXCLUSIONS.—Such term does not in- toward shorter hospital stays is plac- the cost to insurers of treating pa- clude the following, or any combination ing the health of newborns and their tients for conditions which could have thereof: mothers at risk. been prevented or lessened if caught (A) Coverage only for accidental death or Early hospital discharges have earlier, and the costs to the individual dismemberment. caused conditions such as jaundice— and society when a child suffers brain (B) Coverage providing wages or payments that do not appear until after the first damage or other permanent disabilities in lieu of wages for any period during which 24 hours of life and which may lead to because they did not receive adequate the employee is absent from work on ac- count of sickness or injury. brain damage—to go undetected. early care. (C) A medicare supplemental policy (as de- A 24-hour stay is often too short for Mr. President, America’s newborns fined in section 1882(g)(1) of the Social Secu- new mothers to be taught basic infant deserve a better welcome to the world rity Act). care skills, such as breastfeeding. And than they are getting under the (D) Coverage issued as a supplement to li- many mothers are not physically capa- present system. Their mothers also de- ability insurance. ble of providing for a newborn’s needs serve better. It is very important that (E) Worker’s compensation or similar in- 24 hours after giving birth. This can surance. health care costs be controlled, but the (F) Automobile medical-payment insur- lead to inadequate nourishment during ultimate decision about health care ance. a child’s crucial first few days of life. must be based on medical factors, not (G) A long-term care policy, including a Mr. President, I must say that I have financial ones. nursing home fixed indemnity policy (unless agreed to cosponsor this legislation June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9177 with some reservation. I generally view cent of hospitals now require training ditioning of such benefit, assistance, or any effort to influence private con- in induced abortion. A third more do license on the provider’s compliance tracting arrangements with great skep- not offer any such training and the rest with accredition standards that require ticism. However, I view this situation offer it only as an option. Of course, the performance, training, or arranging as limited and unique. What is at stake those programs still are required to for training of induced abortions. The here is not merely an impediment to train residents to manage medical and amendment applies only to State ac- the traditional doctor-patient relation- surgical complications of pregnancy. tion and does not proscribe a private ship, but instead the health and safety And that includes training procedures accrediting body from requiring abor- of millions of America’s children. than might in the case save the life of tion training. My primary concern is that the most the mother, as well as training D and C Providers who choose to offer abor- recent trend toward shorter hospital procedures involving preborn children tion training, and individuals who seek stays appears to be motivated pri- that died as a result of a spontaneous abortion training, may continue to do marily by financial considerations—in- abortion, miscarriage, or stillbirth. so. The amendment does not prevent stead of sound medicine. But all this will change now that the any program from offering abortion In calling for a moratorium on short- Accreditation Council for Graduate training. er hospital stays last week, ACOG stat- Medical Education [ACGME] has voted Providers will continue to train the ed that: to require all hospitals to train or ar- management of complications of in- The routine imposition of a short and arbi- range for training in induced abortion. duced abortion as well as train to han- trary time limit on hospital stays that does The press has indicated that training dle situation involving miscarriage and not take maternal and infant need into ac- in late-term, second-trimester abor- stillbirth or a threat to the life of the count could be equivalent to a large, uncon- tions would be required. The ACGME mother. The amendment requires no trolled, uninformed experiment that may po- has proposed to make exceptions only change in the practice of good obstet- tentially affect the health of American in the case of an institution that can rics and gynecology. women and their babies. formulate a cohesive, institutional ob- This legislation has broad bipartisan Like ACOG, I fear that insurers may jection based on religious or moral support. On the House side Congress- be acting prematurely, without suffi- principles. man HOEKSTRA, LAFALCE, VOLKMER, cient information about the long-term What is particularly shocking is that COBURN, and WELDON have introduced health implications of shorter hospital the Federal Government no only con- identical language in the House follow- stays. As more conclusive data be- dones this compulsion but actually ing hearings. comes available, I would be open to re- punishes those who do not submit. I urge my colleagues to join me and visiting this issue. Until then, I believe Here’s how: Failure to do the abortion protect the rights of health providers we should proceed with caution. training could result in loss of accredi- against Federal and State government I strongly believe that decisions re- tation by the ACGME. Loss of accredi- action that forces them to become in- garding early discharge must be indi- tation would result in loss of Federal volved in training or providing induced vidualized and should place primary funding. For example, Medicare will abortions against their will. emphasis on the health of a mother and not reimburse the Part A costs of in- I ask unanimous consent that the her child. I believe that the legislation tern and resident services if the teach- text of the bill be inserted in the we are introducing today will help re- ing program is not accredited. Further, RECORD. store that perspective to this impor- ob-gyn residents in a program not ac- There being no objection, the bill was tant decision. ∑ credited by the ACGME are ineligible ordered to be printed in the RECORD, as for deferral of repayment on Federal By Mr. COATS (for himself, Mr. follows: Health Education Assistance Loans S. 971 GREGG, Mr. HELMS, and Mr. [HEAL]. The HEAL loan program is re- Be it enacted by the Senate and House of Rep- ASHCROFT): authorized in S. 555, now before the S. 971. A bill to amend the Public resentatives of the United States of America in Senate. Congress assembled, Health Service Act to prohibit govern- Why the change in the standards? In- SECTION 1. SHORT TITLE. mental discrimination in the training ternal correspondence with the ACGME and licensing of health professionals on This Act may be cited as the ‘‘Medical panel suggests that the policy change Training Non-discrimination Act of 1995’’. the basic of the refusal to undergo or was motivated by concern over the de- SEC. 2. ESTABLISHMENT OF PROHIBITION provide training in the performance of clining number of doctors willing to AGAINST ABORTION-RELATED DIS- induced abortions, and for other pur- perform abortions and the need to CRIMINATION IN TRAINING AND LI- poses; to the Committee on Labor and destigmatize abortion providers. This CENSING OF PHYSICIANS. Human Resources. concern over the stigmatization of Part B of title II of the Public Health Serv- ice Act (42 U.S.C. 238 et seq.) is amended by THE MEDICAL TRAINING NONDISCRIMINATION abortion providers was dramatically adding at the end the following section: ACT OF 1995 characterized during the debate on the ‘‘ABORTION-RELATED DISCRIMINATION IN GOV- ∑ Mr. COATS. Mr. President, I intro- Foster nomination when one ‘‘pro- ERNMENTAL ACTIVITIES REGARDING TRAINING duce the Medical Training Non- choice’’ Senator demanded an apology AND LICENSING OF PHYSICIANS discrimination Act of 1995. This bill from another pro-life Senator who had ‘‘SEC. 245. (a) IN GENERAL.—The Federal would prevent any State or Federal ‘‘defamed’’ Dr. Foster by calling him Government, and any State that receives Government from discriminating an abortionist. Would an apology have Federal financial assistance; may not sub- against a health care provider because been demanded if Dr. Foster had been ject any health care entity to discrimination that provider does not perform induced called a heart surgeon or a podiatrist? on the basis that— abortions or train its ob-gyn residents No, there remains substantial negative ‘‘(1) the entity refuses to undergo training to perform induced abortions. stigma associated with being an abor- in the performance of induced abortions, to It is, quite frankly, disturbing to me tion provider—stigma that might be provide such training, to perform such abor- that this legislation is even necessary. tions, or to provide referrals for such abor- eliminated if all obstetricians and gyn- tions; I would venture that few of my col- ecologists had to perform abortions as ‘‘(2) the entity refuses to make arrange- leagues could believe that our society part of their residency training. ments for any of the activities specified in is anywhere near to condoning a re- The Medical Training Nondiscrimina- paragraph (1); or quirement that any person or any hos- tion Act of 1995 would protect the civil ‘‘(3) the entity attends (or attended) a pital be required to perform abortions rights of health care providers by pre- postgraduate physician training program, or or offer training in abortions. venting the Government from discrimi- any other program of training in the health Indeed, as it stands now, our proud nating against any health care pro- professions, that does not (or did not) re- tradition of tolerance toward those vider on the basis that it will not per- quire, provide or arrange for training in the performance of induced abortions, or make who abhor abortion and any participa- form, train, or undergo training to per- arrangements for the provision of such train- tion in that act, has generally pro- form an induced abortion. Discrimina- ing. tected hospitals from having to provide tory actions include denial of any bene- ‘‘(b) ACCREDITATION OF POSTGRADUATE PHY- or train abortions. In fact, only 12 per- fit, assistance, or license, and the con- SICIAN TRAINING PROGRAMS.— S 9178 CONGRESSIONAL RECORD — SENATE June 27, 1995 ‘‘(1) IN GENERAL.—With respect to the Studies have shown that nurse prac- text of the bill be printed in the State government involved, or the Federal titioners provide care that both pa- RECORD. Government, restrictions under subsection tients and cost cutters can praise. There being no objection, the bill was (a) include the restriction that, in granting a Their advanced clinical training en- ordered to be printed in the RECORD, as legal status to a health care entity (includ- ing a license or certificate), or in providing ables them to assume responsibility for follows: to the entity financial assistance, a service, up to 80 percent of the primary care S. 972 or another benefit, the government may not services usually performed by physi- Be it enacted by the Senate and House of Rep- require that the entity be an accredited post- cians, many times at a lower cost and resentatives of the United States of America in graduate physician training program, or that with a high level of patient satisfac- Congress assembled, the entity have completed or be attending tion. SECTION 1. MEDICAID COVERAGE OF ALL CER- such a program, if the applicable standards Congress has already recognized the TIFIED NURSE PRACTITIONER AND for accreditation of the program include the expanding contributions of nurse prac- CLINICAL NURSE SPECIALIST SERV- standard that the program must require, ICES. provide or arrange for training in the per- titioners. For more than a decade, CHAMPUS has provided direct pay- (a) IN GENERAL.—Section 1905(a)(21) of the formance of induced abortions, or make ar- Social Security Act (42 U.S.C. 1396d(a)(21)) is rangements for the provision of such train- ment to nurse practioners. In 1990, Con- amended to read as follows: ing. gress mandated direct payment for ‘‘(21) services furnished by a certified nurse ‘‘(2) RULE OF CONSTRUCTION.—With respect nurse practitioner services under the practitioner (as defined by the Secretary) or to subclauses (I) and (II) of section Federal employee health benefit plan. clinical nurse specialist (as defined in sub- 705(a)(2)(B)(i) (relating to a program of in- Recent legislation has required direct section (t)) which the certified nurse practi- sured loans for training in the health profes- Medicare reimbursement for nurse tioner or clinical nurse specialist is legally sions), the requirements in such subclauses authorized to perform under State law (or regarding accredited internship or residency practitioners practicing in rural areas and direct Medicaid reimbursement for the State regulatory mechanism provided by programs are subject to paragraph (1) of this State law), whether or not the certified subsection. family nurse practitioners. nurse practitioner or clinical nurse special- ‘‘(c) DEFINITIONS.—For purposes of this sec- Mr. President, the ramifications of ist is under the supervision of, or associated tion: this issue extend beyond the Medicaid with, a physician or other health care pro- ‘‘(1) The term ‘financial assistance’, with program and its beneficiaries; there is vider;’’ respect to a government program, includes a broader lesson here that applies to (b) CLINICAL NURSE SPECIALIST DEFINED.— governmental payments provided as reim- Section 1905 of such Act (42 U.S.C. 1396d) is bursement for carrying out health-related our search for ways to make cost-effec- amended by adding at the end the following activities. tive, high-quality health care services ‘‘(2) The term ‘health care entity’ includes available and accessible to all of our new subsection: an individual physician, a postgraduate phy- citizens. ‘‘(t) The term ‘clinical nurse specialist’ sician training program, and a participant in One of the cornerstones of this kind means an individual who— a program of training in the health profes- ‘‘(1) is a registered nurse and is licensed to of care is the expansion of primary and practice nursing in the State in which the sions. preventive care, delivered to individ- ‘‘(3) The term ‘postgraduate physician clinical nurse specialist services are per- training program’ includes a residency train- uals in convenient, familiar places formed; and ing program.’’.∑ where they live, work, and go to ‘‘(2) holds a master’s degree in a defined school. More than 2 million of our Na- area of clinical nursing from an accredited By Mr. DASCHLE (for himself, tion’s nurses currently provide care in educational institution.’’. Mr. INOUYE, Mr. HARKIN, Mr. these sites—in home health agencies, (c) EFFECTIVE DATE.—The amendments HOLLINGS, Mr. BINGAMAN, Mrs. nursing homes, ambulatory care clin- made by this section shall become effective with respect to payments for calendar quar- BOXER, and Mr. AKAKA): ics, and schools. ters beginning on or after January 1, 1996. S. 972. A bill to amend title XIX of In places like my home State of the Social Security Act to provide for South Dakota, nurses are often the ∑ Mr. AKAKA. Mr. President, I am Medicaid coverage of all certified nurse only health care professionals avail- pleased to join Senator DASCHLE as a practioners and clinical nurse special- able in the small towns and rural coun- cosponsor of the Medicaid Nursing In- ists services; to the Committee on Fi- ties across the State. centive Act of 1995. This legislation nance. These nurses and other nonphysican would provide direct Medicaid reim- THE MEDICAID NURSING INCENTIVE ACT OF 1995 health professionals play an important bursement to nurse practitioners and Mr. DASCHLE. Mr. President, today role in the delivery of care. And, this clinical nurse specialists for services I am introducing the Medicaid Nursing role will increase as we move from a they provide within their scope of prac- Incentive Act of 1995, a bill to provide system that focuses on the costly tice, regardless of whether these serv- direct Medicaid reimbursement to treatment of illness to one that empha- ices are performed under the super- nurse practitioners. sizes primary care and health pro- vision of a physician. The ultimate goal of this proposal is motion. With the current shortage of primary to enhance the availability of cost-ef- But, first we must revaluate out- health care services in our Nation, mil- fective primary care to our Nation’s dated attitudes and break down bar- lions of Americans are without essen- most needy citizens. riers that prevent nurses from using tial health services. Medicaid recipi- Studies have documented the fact the full range of their training and ents are particularly vulnerable. that millions of Americans each year skills in caring for patients. In 1994, By allowing direct Medicaid reim- do without the health care services the Pew Health Professions Commis- bursement to nurse practitioners and they need, because physicians simply sion concluded that nurse practitioners clinical nurse specialists, I believe that are not available to care for them. This are not being fully utilized to deliver this legislation will not only improve problem plagues rural and urban areas primary care services and rec- access to much needed health care alike, in parts of the country as diverse ommended eliminating fiscal discrimi- services, but will strengthen our health as south central Los Angeles and nation by paying them directly for the care delivery system. A number of re- Lemmon, SD. services they provide. This step will cent studies have documented the im- Medicaid beneficiaries are particu- help nurse practitioners provide the ac- portant roles that nurse practitioners larly vulnerable, since in recent years cess to primary care that so many and clinical nurse specialists play in an increasing number of health profes- communities currently lack. providing cost-effective, quality health sionals have chosen not to care for Mr. President, I hope my colleagues care services. For example, a December them or have been unwilling to locate will support the measure I am intro- 1986 study by the Office of Technology in the inner city and rural commu- ducing today, recognizing the impor- Assessment detailed the significant nities where they live. Fortunately, tant role that nurse practitioners and contributions nurse practitioners have there is an exception to this trend: other nonphysician health profes- made in reducing health care costs, im- Nurse practitioners frequently accept sionals can play in our health care de- proving the quality of care, and in- patients whom others will not treat livery system and the increasing con- creasing the accessibility of services. and serve in areas where others refuse tribution they can make in the future. I urge my colleagues to support this to work. I ask unanimous consent that the full legislation. It will enhance access to June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9179 cost-effective, quality care for individ- ulation increases created a demand for eral Government if this legislation is uals with limited access to health care housing and other types of real estate enacted into law. services.∑ development. Federal income tax pol- Mr. President, I ask unanimous con- icy encouraged the retention of land to sent that the text of my bill be printed By Mr. INOUYE: avoid payment of large capital gains in the RECORD. S. 973. A bill to amend the Internal taxes. There being no objection, the bill was Revenue Code of 1986 to provide for the Hawaii’s land tenure system is now ordered to be printed in the RECORD, as tax treatment of residential ground anomalous to the rest of the United follows: rents, and for other purposes; to the States because of the concentration of S. 973 Committee on Finance. land in the hands of government, large Be it enacted by the Senate and House of Rep- THE RESIDENTIAL GROUND RENTS ACT OF 1995 charitable trusts, large agriculturally- resentatives of the United States of America in Mr. INOUYE. Mr. President, I rise based companies and owners of small Congress assembled, today to speak on an issue of great im- parcels or urban properties. SECTION 1. MORTGAGE INTEREST DEDUCTION portance to Hawaii’s leasehold home- High land prices and high renegoti- FOR QUALIFIED NON-REDEEMABLE owners. In fiscal year 1992, at my re- ated rents continue to create instabil- GROUND RENTS. quest, the Congress appropriated ity in Hawaii’s residential leasehold (a) IN GENERAL.—Section 163(c) of the In- $400,000 to study the feasibility of re- system. In 1967, the Hawaii State legis- ternal Revenue Code of 1986 is amended to forming the Internal Revenue Code to lature enacted a land reform act which read as follows: address ground lease rent payments did not become effective until the U.S. ‘‘(c) GROUND RENTS.—For purposes of this and to determine what role, if any, the subtitle, any annual or periodic rental under Supreme Court issued its 1984 decision, a redeemable ground rent (excluding Federal Government should play in en- Hawaii Housing Authority versus amounts in redemption thereof) or a quali- couraging lease to fee conversions. The Midkiff. The act and the Supreme fied non-redeemable ground rent shall be nationwide study was conducted by the Court decision basically divided the treated as interest on an indebtedness se- Hawaii Real Estate and Research Cen- market into a ‘‘single-family home cured by a mortgage.’’ ter. market in which leaseholds were sub- (b) TREATMENT OF QUALIFIED NON-REDEEM- The legislation I am introducing ject to mandatory conversion, and a ABLE GROUND RENTS.— today is based on the recommendations leasehold condominium market which (1) IN GENERAL.—Subsections (a), (b), and of this study. The bill would: First, did not come within the scope of the (d) of section 1055 of the Internal Revenue provide a mortgage interest deduction Code of 1986 (relating to redeemable ground law.’’ rents) are amended by inserting ‘‘or qualified for residential leasehold properties by Mandatory conversions on the single- non-redeemable’’ after ‘‘redeemable’’ each allowing the nonredeemable ground family home market occurred from place it appears. lease rents to be claimed as an interest 1979 to 1982, and 1986 to 1990. As of 1992, (2) DEFINITION.—Section 1055 of such Code deduction; and, second, include a tax there are approximately 4,600 single- is amended by redesignating subsection (d) credit for up to $5,000 for certain trans- family homes remaining in residential as subsection (e) and by inserting after sub- action costs on the transfer of certain leaseholds. However, resolution over section (c) the following new subsection: residential leasehold land for a 5-year condominium leasehold reform remains ‘‘(d) QUALIFIED NON-REDEEMABLE GROUND period, ending on December 31, 1999. uncertain. In 1990, the Honolulu City RENT.—For purposes of this subtitle, the term ‘qualified non-redeemable ground rent’ Transaction costs include closing Council enacted legislation that would means a ground rent with respect to which— costs, attorneys’ fees, surveys, and ap- cap lease rent increases. The law was ‘‘(1) there is a lease of land which is for a praisals, and telephone, office, and challenged in Federal district court as term in excess of 15 years, travel expenses. to its validity and eventually ruled as ‘‘(2) no portion of any payment is allocable In most private home ownership situ- unconstitutional because the formula to the use of any property other than the ations in this country, a homeowner it used to arrive at permitted lease land surface, owns both the building and land. Under rent was irrational. ‘‘(3) the lessor’s interest in the land is pri- a leasehold arrangement a homeowner In 1991, due to the State legislature’s marily a security interest to protect the owns the building—single-family home, rental payments to which the lessor is enti- unwillingness to address the leasehold tled under the lease, and condominium, or cooperative apart- problems, the Honolulu City Council ‘‘(4) the leased property must be used as ment—on leased land. The research again enacted a mandatory leasehold the taxpayer’s principal residence (within conducted under the leasehold study conversion law for leasehold condomin- the meaning of section 1034).’’ shows that residential leaseholds are iums (Ordinance 01–95). The law is cur- (3) CONFORMING AMENDMENTS.— not uncommon in other parts of the rently being challenged in the Federal (A) The heading for section 1055 of such United States and elsewhere in the courts as to its constitutionality. An- Code is amended by striking ‘‘redeemable’’. world. Residential leaseholds exist in other bill which linked lease rent in- (B) The item relating to section 1055 in the places such as Baltimore, MD, Irvine, table of sections for part IV of subchapter O creases with the Consumer Price Index of chapter 1 of subtitle A of such Code is CA, native American lands in Palm and the level of disposable income amended by striking ‘‘Redeemable ground’’ Springs, CA, Fairhope, AL, Pearl River available to condominium owners was and inserting ‘‘Ground’’. Basin, MS, and New York, NY. also considered. This bill, similar to (c) EFFECTIVE DATE.—The amendments The study further indicates that the one enacted in 1990, was found to be made by this section shall take effect on the there are few States that regulate resi- unconstitutional. date of the enactment of this Act, with re- dential leaseholds. Of those that do, The uncertainty in the residential spect to taxable years ending after such the most common requirement applies leasehold market continues to create date. only to condominium or time share emotional distress for the leasehold SEC. 2. CREDIT FOR TRANSACTION COSTS ON THE TRANSFER OF LAND SUBJECT units and is one requiring adequate dis- residents of Hawaii. Voluntary conver- TO CERTAIN GROUND RENTS. closure of the lease terms. For the sion has helped to ease the situation (a) IN GENERAL.—Subpart B of part IV of most part, States are unaware of any and substantially reduce the stock of subchapter A of chapter 1 of the Internal leasehold problems in their jurisdic- leasehold residential units in Hawaii. Revenue Code of 1986 (relating to foreign tax tions. However, residential leaseholds Yet, voluntary conversion is not credit, etc.) is amended by inserting after have proven to be problematic for the enough to resolve the residential lease- section 30 the following new section: State of Hawaii. hold problems. ‘‘SEC. 30A. CREDIT FOR TRANSACTION COSTS. The formation of Hawaii’s land ten- My legislation will help reduce the ‘‘(a) ALLOWANCE OF CREDIT.— ure system can be traced back to 1778 economic hardship due to the uncer- ‘‘(1) IN GENERAL.—At the election of the when British Capt. James Cook made tainty in Hawaii’s residential leasehold taxpayer, there shall be allowed as a credit his first contact with the Hawaiian civ- system. The leasehold study contains against the tax imposed by this chapter for ilization. Leasing was the preferred an analysis of the tax revenue effects the taxable year an amount equal to the transaction costs relating to any sale or ex- system to maintain control and retain of this legislation by allowing individ- change of land subject to ground rents with a portfolio asset value. Residential ual tax deductions for residential respect to which immediately after and for leaseholds were first developed on the ground rent. The analysis suggests that at least 1 year prior to such sale or ex- Island of Oahu after World War II. Pop- there is potential revenues to the Fed- change— S 9180 CONGRESSIONAL RECORD — SENATE June 27, 1995 ‘‘(A) the transferee is the lessee who owns serting after the item relating to section 30 so my bill corrects that so that if pros- a dwelling unit on the land being trans- the following new item: ecutors cannot, with the exercise of ef- ferred, and ‘‘Sec. 30A. Credit for transaction costs on fort, give the court a location, then ‘‘(B) the transferor is the lessor. the transfer of land subject to those prosecutors can still get a wire- ‘‘(2) CREDIT ALLOWED TO BOTH TRANSFEROR certain ground rents.’’ tapping order. And for law enforcers— AND TRANSFEREE.—The credit allowed under (c) EFFECTIVE DATE.—The amendments paragraph (1) shall be allowed to both the both State and Federal—who have made by this section shall apply to expendi- transferor and the transferee. seized a computer which contains both tures paid or incurred in taxable years begin- contraband or evidence and purely pri- ‘‘(b) LIMITATIONS.— ning after December 31, 1994. vate material, I have created a good- ‘‘(1) LIMITATION PER DWELLING UNIT.—The amount of the credit allowed to a taxpayer By Mr. GRASSLEY: faith standard so that law enforcers are under subsection (a) for any taxable year S. 974. A bill to prohibit certain acts not shackled by undue restrictions but shall not exceed the lesser of— involving the use of computers in the will also be punished for bad faith. ‘‘(A) $5,000 per dwelling unit, or furtherance of crimes, and for other Mr. President, this brave new world ‘‘(B) 10 percent of the sale price of the land. purposes; to the Committee on the Ju- of electronic communications and glob- ‘‘(2) LIMITATION BASED ON TAXABLE IN- diciary. al computer networks holds much COME.—The amount of the credit allowed to promise. But like almost anything, THE ANTI-ELECTRONIC RACKETEERING ACT a taxpayer under subsection (a) for any tax- there is the potential for abuse and able year shall not exceed the sum of— Mr. GRASSLEY. Mr. President, I rise harm. That is why I urge my col- ‘‘(A) 20 percent of the regular tax for the this evening to introduce the Anti-elec- leagues to support this bill and that is taxable year reduced by the sum of the cred- tronic Racketeering Act of 1995. This why I urge industry to support this its allowable under subpart A and sections bill makes important changes to RICO 27, 28, 29, and 30, plus bill. and criminalizes deliberately using On a final note, I would say that we ‘‘(B) the alternative minimum tax imposed computer technology to engage in by section 55. should not be too scared of technology. criminal activity. I believe this bill is After all, we are still just people and ‘‘(c) DEFINITIONS AND SPECIAL RULES.—For a reasonable, measured and strong re- purposes of this section— right is still right and wrong is still sponse to a growing problem. Accord- wrong. Some things change and some ‘‘(1) TRANSACTION COSTS.— ing to the computer emergency and re- ‘‘(A) IN GENERAL.—The term ‘transaction things do not. All that my bill does is costs’ means any expenditure directly associ- sponse team at Carnegie-Mellon Uni- say you can’t use computers to steal, ated with a transaction, the purpose of versity, during 1994, about 40,000 com- to threaten others or conceal criminal which is to convey to the lessee, by the les- puter users were attacked. Virus hack- conduct. sor, land subject to ground rents. er, the FBI’s national computer crime Mr. President, I ask unanimous con- ‘‘(B) SPECIFIC EXPENDITURES.—Such term squad has investigated over 200 cases sent that the text of the bill be printed includes closing costs, attorney fees, surveys since 1991. So, computer crime is clear- in the RECORD. and appraisals, and telephone, office, and ly on the rise. travel expenses incurred in negotiations with There being no objection, the bill was Mr. President, I suppose that some of ordered to be printed in the RECORD, as respect to such transaction. this is just natural. Whenever man de- ‘‘(C) LOST RENTS NOT INCLUDED.—Such term follows: velops a new technology, that tech- does not include lost rents due to the pre- S. 974 mature termination of an existing lease. nology will be abused by some. And that is why I have introduced this bill. Be it enacted by the Senate and House of Rep- ‘‘(2) DWELLING UNIT.—A dwelling unit shall resentatives of the United States of America in include any structure or portion of any I believe we need to seriously recon- Congress assembled, structure which serves as the principal resi- sider the Federal Criminal Code with SECTION 1. SHORT TITLE. dence (within the meaning of section 1034) an eye toward modernizing existing This Act may be cited as the ‘‘Anti-Elec- for the lessee. statutes and creating new ones. In tronic Racketeering Act of 1995’’. ‘‘(3) REDUCTION IN BASIS.—The basis of other words, Mr. President, Elliot Ness SEC. 2. PROHIBITED ACTIVITIES. property acquired in a transaction to which needs to meet the Internet. this section applies shall be reduced by the (a) DEFINITIONS.—Section 1961(1) of title 18, amount of credit allowed under subsection Mr. President, I sit on the Board of United States Code, is amended— (a). the Office of Technology Assessment. (1) by striking ‘‘1343 (relating to wire fraud)’’ and inserting ‘‘1343 (relating to wire ‘‘(4) ELECTION.—This section shall apply to That Office has clearly indicated that any taxpayer for the taxable year only if organized crime has entered cyberspace and computer fraud)’’; such taxpayer elects to have this section so in a big way. International drug cartels (2) by striking ‘‘that title’’ and inserting apply. ‘‘this title’’; use computers to launder drug money (3) by striking ‘‘or (E)’’ and inserting ‘‘(d) CARRYOVER OF CREDIT.— and terrorists like the Oklahoma City ‘‘(E)’’; and ‘‘(1) CARRYOVER PERIOD.—If the credit al- bombers use computers to conspire to (4) by inserting before the semicolon the lowed to the taxpayer under subsection (a) commit crimes. following: ‘‘or (F) any act that is indictable for any taxable year exceeds the amount of Computer fraud accounts for the loss under section 1030, 1030A, or 1962(d)(2)’’. the limitation imposed by subsection (b)(2) of millions of dollars per year. And (b) USE OF COMPUTER TO FACILITATE RACK- for such taxable year (hereafter in this sub- often times, there is little that can be ETEERING ENTERPRISE.—Section 1962 of title section referred to as the ‘unused credit done about this because the computer 18, United States Code, is amended— year’), such excess shall be a carryover to (1) by redesignating subsection (d) as sub- each of the 5 succeeding taxable years. used to commit the crimes is located section (e); and ‘‘(2) AMOUNT CARRIED TO EACH YEAR.— overseas. So, under my bill, overseas (2) by inserting after subsection (c) the fol- ‘‘(A) ENTIRE AMOUNT CARRIED TO FIRST computer users who employ their com- lowing new subsection: YEAR.—The entire amount of the unused puters to commit fraud in the United ‘‘(d) It shall be unlawful for any person— credit for an unused credit year shall be car- States would be fully subject to the ‘‘(1) to use any computer or computer net- ried to the earliest of the 5 taxable years to Federal criminal laws. Also under my work in furtherance of a racketeering activ- which (by reason of paragraph (1)) such cred- bill, Mr. President, the wire fraud stat- ity (as defined in section 1961(1)); or it may be carried. ute which has been successfully used ‘‘(2) to damage or threaten to damage elec- ‘‘(B) AMOUNT CARRIED TO OTHER 4 YEARS.— tronically or digitally stored data.’’. by prosecutors for many users, will be The amount of unused credit for the unused (c) CRIMINAL PENALTIES.—Section 1963(b) of credit year shall be carried to each of the re- amended to make fraudulent schemes title 18, United States Code, is amended— maining 4 taxable years to the extent that which use computers a crime. (1) by striking ‘‘and’’ at the end of para- such unused credit may not be taken into ac- It is not enough to simply modernize graph (1); count for a prior taxable year because of the the Criminal Code. We also have to re- (2) by striking the period at the end of limitation imposed by subsection (b)(2). consider many of the difficult proce- paragraph (2) and inserting ‘‘; and’’; and (3) by adding at the end the following new ‘‘(e) TERMINATION.—This section shall not dural burdens that prosecutors must paragraph: apply to any transaction cost paid or in- overcome. For instance, in the typical ‘‘(3) electronically or digitally stored curred in taxable years beginning after De- case, prosecutors must identify a loca- data.’’. cember 31, 1999.’’ tion in order to get a wiretapping (d) CIVIL REMEDIES.—Section 1964(c) of title (b) CLERICAL AMENDMENT.—The table of order. But in cyberspace, it is often im- 18, United States Code, is amended by strik- sections for such subpart B is amended by in- possible to determine the location. And ing ‘‘his property or business’’. June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9181 (e) USE AS EVIDENCE OF INTERCEPTED WIRE deemed to have been committed within the 304, a bill to amend the Internal Reve- OR ORAL COMMUNICATIONS.—Section 2515 of territorial jurisdiction of the United States. nue Code of 1986 to repeal the transpor- title 18, United States Code, is amended by ‘‘(B) Any action taken in furtherance of an tation fuels tax applicable to commer- act described in subparagraph (A) shall be inserting before the period at the end the fol- cial aviation. lowing: ‘‘, unless the authority in possession deemed to have been committed in the terri- of the intercepted communication attempted torial jurisdiction of the United States. S. 327 in good faith to comply with this chapter. If ‘‘(2) In any prosecution under this section At the request of Mr. HATCH, the the United States or any State of the United involving acts deemed to be committed with- name of the Senator from Missouri States, or subdivision thereof, possesses a in the territorial jurisdiction of the United [Mr. BOND] was added as a cosponsor of communication intercepted by a nongovern- States under this subsection, venue shall be S. 327, a bill to amend the Internal proper where the computer, computer facil- mental actor, without the knowledge of the Revenue Code of 1986 to provide clari- United States, that State, or that subdivi- ity, or computer network was physically sit- sion, the communication may be introduced uated at the time at least one of the wrong- fication for the deductibility of ex- into evidence’’. ful acts was committed.’’. penses incurred by a taxpayer in con- (f) AUTHORIZATION FOR INTERCEPTION OF (i) WIRE AND COMPUTER FRAUD.—Section nection with the business use of the WIRE, ORAL, OR ELECTRONIC COMMUNICA- 1343 of title 18, United States Code, is amend- home. TIONS.—Section 2516(1) of title 18, United ed by striking ‘‘or television communica- S. 426 States Code, is amended— tion’’ and inserting ‘‘television communica- At the request of Mr. SARBANES, the (1) by striking ‘‘and’’ at the end of para- tion, or computer network or facility’’. graph (n); (j) PRIVACY PROTECTION ACT.—Section 101 name of the Senator from Illinois [Ms. (2) by striking the period at the end of of the Privacy Protection Act of 1980 (42 MOSELEY-BRAUN] was added as a co- paragraph (o) and inserting ‘‘; and’’; and U.S.C. 2000aa) is amended— sponsor of S. 426, a bill to authorize the (3) by adding at the end the following new (1) in subsection (a)— Alpha Phi Alpha Fraternity to estab- paragraph: (A) by striking ‘‘or’’ at the end of para- lish a memorial to Martin Luther King, ‘‘(p) any violation of section 1962 of title graph (1); Jr., in the District of Columbia, and for 18.’’. (B) by striking the period at the end of other purposes. (g) PROCEDURES FOR INTERCEPTION.—Sec- paragraph (2) and inserting ‘‘; or’’; and tion 2518(4)(b) of title 18, United States Code, (C) by adding at the end the following new S. 436 is amended by inserting before the semicolon paragraph: At the request of Mr. CAMPBELL, the the following: ‘‘to the extent feasible’’. ‘‘(3) there is reason to believe that the im- names of the Senator from Kansas (h) COMPUTER CRIMES.— mediate seizure of such materials is nec- [Mrs. KASSEBAUM] and the Senator (1) NEW PROHIBITED ACTIVITIES.—Chapter 47 essary to prevent the destruction or alterca- from Illinois [Mr. SIMON] were added as of title 18, United States Code, is amended by tion of such documents.’’; and cosponsors of S. 436, a bill to improve adding at the end the following new section: (2) in subsection (b)— the economic conditions and supply of ‘‘§ 1030A. Racketeering-related crimes involv- (A) by striking ‘‘or’’ at the end of para- ing computers graph (3); housing in Native American commu- ‘‘(a) It shall be unlawful— (B) by striking the period at the end of nities by creating the Native American ‘‘(1) to use a computer or computer net- paragraph (4) and inserting ‘‘; or’’; and Financial Services Organization, and work to transfer unlicensed computer soft- (C) by adding at the end the following new for other purposes. ware, regardless of whether the transfer is paragraph: S. 448 performed for economic consideration; ‘‘(5) in the case of electronically stored data, the seizure is incidental to an other- At the request of Mr. GRASSLEY, the ‘‘(2) to distribute computer software that name of the Senator from Rhode Island encodes or encrypts electronic or digital wise valid seizure, and the government offi- [Mr. CHAFEE] was added as a cosponsor communications to computer networks that cer or employee— the person distributing the software knows ‘‘(A) was not aware that work product ma- of S. 448, a bill to amend section 118 of or reasonably should know, is accessible to terial was among the data seized; the Internal Revenue Code of 1986 to foreign nationals and foreign governments, ‘‘(B) upon actual discovery of the existence provide for certain exceptions from regardless of whether such software has been of work product materials, the government rules for determining contributions in designated as nonexportable; and officer or employee took reasonable steps to aid of construction, and for other pur- protect the privacy interests recognized by ‘‘(3) to use a computer or computer net- poses. work to transmit a communication intended this section, including— S. 641 to conceal or hide the origin of money or ‘‘(i) using utility software to seek and other assets, tangible or intangible, that identify electronically stored data that may At the request of Mrs. KASSEBAUM, were derived from racketeering activity; and be commingled or combined with non-work the name of the Senator from Maine ‘‘(4) to operate a computer or computer product material; and [Ms. SNOWE] was added as a cosponsor network primarily to facilitate racketeering ‘‘(ii) upon actual identification of such ma- of S. 641, a bill to reauthorize the Ryan activity or primarily to engage in conduct terial, taking reasonable steps to protect the privacy of the material, including seeking a White CARE Act of 1990, and for other prohibited by Federal or State law. purposes. ‘‘(b) For purposes of this section, each act search warrant.’’. of distributing software is considered a sepa- f S. 892 rate predicate act. Each instance in which At the request of Mr. GRASSLEY, the nonexportable software is accessed by a for- ADDITIONAL COSPONSORS name of the Senator from Utah [Mr. eign government, an agent of a foreign gov- S. 256 HATCH] was added as a cosponsor of S. ernment, a foreign national, or an agent of a At the request of Mr. DOLE, the name 892, a bill to amend section 1464 of title foreign national, shall be considered as a sep- 18, United States Code, to punish trans- arate predicate act. of the Senator from Rhode Island [Mr. ‘‘(c) It shall be an affirmative defense to CHAFEE] was added as a cosponsor of S. mission by computer of indecent mate- prosecution under this section that the soft- 256, a bill to amend title 10, United rial to minors. ware at issue used a universal decoding de- States Code, to establish procedures for S. 955 vice or program that was provided to the De- determining the status of certain miss- At the request of Mr. HATCH, the partment of Justice prior to the distribu- ing members of the Armed Forces and names of the Senator from Wisconsin tion.’’. certain civilians, and for other pur- [Mr. KOHL] and the Senator from Wash- (2) CLERICAL AMENDMENT.—The analysis at the beginning of chapter 47, United States poses. ington [Mr. GORTON] were added as co- Code, is amended by adding at the end the S. 267 sponsors of S. 955, a bill to clarify the following new item: At the request of Mr. STEVENS, the scope of coverage and amount of pay- ‘‘1030A. Racketeering-related crimes involv- name of the Senator from Oregon [Mr. ment under the medicare program of ing computers.’’. PACKWOOD] was added as a cosponsor of items and services associated with the (3) JURISDICTION AND VENUE.—Section 1030 S. 267, a bill to establish a system of li- use in the furnishing of inpatient hos- of title 18, United States Code, is amended by censing, reporting, and regulation for pital services of certain medical de- adding at the end the following new sub- vessels of the United States fishing on vices approved for investigational use. section: the high seas, and for other purposes. S. 959 ‘‘(g)(1)(A) Any act prohibited by this sec- tion that is committed using any computer, S. 304 At the request of Mr. HATCH, the computer facility, or computer network that At the request of Mr. SANTORUM, the name of the Senator from Idaho [Mr. is physically located within the territorial name of the Senator from Maine [Ms. KEMPTHORNE] was added as a cosponsor jurisdiction of the United States shall be SNOWE] was added as a cosponsor of S. of S. 959, a bill to amend the Internal S 9182 CONGRESSIONAL RECORD — SENATE June 27, 1995 Revenue Code of 1986 to encourage cap- AMENDMENTS SUBMITTED ON (d) INVESTMENT ADVISERS ACT OF 1940.— ital formation through reductions in JUNE 26, 1995 Section 209(d) of the Investment Advisers taxes on capital gains, and for other Act of 1940 (15 U.S.C. 80b–9) is amended) (1) in subsection (d)— purposes. (A) by striking ‘‘or that any person has THE PRIVATE SECURITIES SENATE RESOLUTION 103 aided, abetted, counseled, commanded, in- LITIGATION REFORM ACT OF 1995 duced, or procured, is aiding, abetting, coun- At the request of Mr. DOMENICI, the seling, commanding, inducing, or procuring, name of the Senator from Washington or is about to aid, abet, counsel, command, [Mrs. MURRAY] was added as a cospon- BRYAN AMENDMENT NO. 1474 induce, or procure such a violation,’’; and sor of Senate Resolution 103, a resolu- Mr. BRYAN proposed an amendment (B) by striking ‘‘or in aiding, abetting, tion to proclaim the week of October 15 to the bill (S. 240) to amend the Securi- counseling, commanding, inducing, or pro- through October 21, 1995, as National curing any such act or practice’’; and ties Exchange Act of 1934 to establish a (2) by adding at the end the following new Character Counts Week, and for other filing deadline and to provide certain subsection: purposes. safeguards to ensure that the interests ‘‘(f) PROSECUTION OF PERSONS WHO AID OR ABET VIOLATIONS.—For purposes of sub- SENATE RESOLUTION 117 of investors are well protected under the implied private action provisions of sections (d) and (e), any person who know- At the request of Mr. ROTH, the name the act; as follows: ingly or recklessly provides substantial as- sistance to another person in the violation of of the Senator from Washington [Mr. On page 127, strike line 20 and all that fol- a provision of this title, or of any rule, regu- GORTON] was added as a cosponsor of lows through page 128, line 15, and insert the lation, or order promulgated under this title, Senate Resolution 117, a resolution ex- following: pressing the sense of the Senate that shall be deemed to violate such provision to SEC. 108. AUTHORITY OF COMMISSION TO PROS- the same extent as the person to whom such the current Federal income tax deduc- ECUTE AIDING AND ABETTING. assistance is provided. No person shall be lia- tion for interest paid on debt secured (a) SECURITIES ACT OF 1933.—Section 20 of ble under this subsection based on an omis- by a first or second home located in the the Securities Act of 1933 (15 U.S.C. 77t) is sion or failure to act unless such omission or United States should not be further re- amended by adding at the end the following failure constituted a breach of duty owed by new subsection: stricted. such person.’’. ‘‘(n) PROSECUTION OF PERSONS WHO AID OR f ABET VIOLATIONS.—For purposes of sub- sections (b) and (d), any person who know- BOXER (AND BINGAMAN) ingly or recklessly provides substantial as- AMENDMENT NO. 1475 SENATE RESOLUTION 142—TO CON- sistance to another person in the violation of Mrs. BOXER (for herself and Mr. GRATULATE THE NEW JERSEY a provision of this title, or of any rule or reg- DEVILS ulation promulgated under this title, shall BINGAMAN) proposed an amendment to be deemed to violate such provision to the the bill, S. 240, supra; as follows: Mr. LAUTENBERG (for himself and same extent as the person to whom such as- On page 98, strike line 3, and all that fol- Mr. BRADLEY) submitted the following sistance is provided. No person shall be liable lows through page 100, line 22, and insert the resolution; which was considered and under this subsection based on an omission following: agreed to: or failure to act unless such omission or fail- ‘‘(2) APPOINTMENT OF LEAD PLAINTIFF OR ure constituted a breach of a duty owed by PLAINTIFFS.—Not later than 90 days after the S. RES. 142 such person.’’. date on which a notice is published under Whereas on October 5, 1982, the New Jersey (b) SECURITIES EXCHANGE ACT OF 1934.— subparagraph (A) or (B) of paragraph (1), the Devils played their first National Hockey Section 20 of the securities exchange Act of court shall determine whether all named League game in New Jersey, embarking on a 1934 (15 U.S.C. 78t) is amended— plaintiffs acting on behalf of the purported quest for the Stanley Cup which was satis- (1) by adding at the end the following new plaintiff class who have moved the court to fied 13 years later; subsection: be appointed to serve as lead plaintiff under ‘‘(e) PROSECUTION OF PERSONS WHO AID OR paragraph (1)(A)(ii) have unanimously se- Whereas the Devils epitomize New Jersey ABET VIOLATIONS.—For purposes of para- lected a named plaintiff or plaintiffs to serve pride with their heart, stamina, and drive graphs (1) and (3) of section 21(d), or an ac- as lead plaintiff or plaintiffs of the purported and thus have become a part of New Jersey tion by a self-regulatory organization, or an plaintiff class, and— culture; express or implied private right of action ‘‘(A) if so, shall appoint such named plain- Whereas the New Jersey Devils won 10 arising under this title, any person who tiff or plaintiffs to serve as lead plaintiff or games on the road during the Stanley Cup knowingly or recklessly provides substantial plaintiffs of the purported plaintiff class; or playoffs, thus demolishing the previous assistance to another person in the violation ‘‘(B) if not, after considering all relevant record; of a provision of this title, or of any rule or factors, including, but not limited to finan- regulation promulgated under this title, cial interest in the relief sought, work done Whereas the Devils have implemented an shall be deemed to violate such provision and to develop and prosecute the case, the qual- ingenious system known as the ‘‘trap’’ that shall be liable to the same extent as the per- ity of the claim, prior experience represent- was designed by head coach Jacques Lemaire son to whom such assistance is provided. No ing classes, possible conflicting interests, which constantly stifled and frustrated their person shall be liable under this subsection and exposure to unique defenses, shall select opponents; based on an omission or failure to act unless and appoint a named plaintiff or plaintiffs to Whereas Conn Smythe trophy winner such omission or failure constituted a breach serve as lead plaintiff or plaintiffs of the pur- Claude Lemieux led the league with 13 play- of a duty owed by such person.’’; and ported plaintiff class. off goals, three of which were game-winners, (2) by striking the section heading and in- ‘‘(3) SELECTION OF LEAD COUNSEL.—The lead and goalie Martin Brodeur led the league serting the following: plaintiff or plaintiffs appointed under para- with a 1.67 goals-against average during the ‘‘SEC. 20. LIABILITY OF CONTROLLING PERSONS graph (2) shall, subject to the approval of the playoffs; AND PERSONS WHO AID OR ABET court, select and retain counsel to represent Whereas the New Jersey hockey fans are VIOLATIONS.’’. the class.’’ the best fans in the nation and deserve com- (c) INVESTMENT COMPANY ACT OF 1940.—Sec- On page 102, strike line 3, and all that fol- mendation for helping build the team into tion 42 of the Investment Company Act of lows through page 104, line 22, and insert the championship caliber and for supporting the 1940 (15 U.S.C. 81a–41) is amended by adding following: Devils during their drive for the Stanley at the end the following new subsection: ‘‘(2) APPOINTMENT OF LEAD PLAINTIFF OR Cup; ‘‘(f) PROSECUTION OF PERSONS WHO AID OR PLAINTIFFS.—Not later than 90 days after the ABET VIOLATIONS.—For purposes of sub- date on which a notice is published under Whereas the New Jersey Devils during the sections (d) and (e), any person who know- subparagraph (A) or (B) of paragraph (1), the playoffs beat Boston, Pittsburgh, Philadel- ingly or recklessly provides substantial as- court shall determine whether all named phia and in the finals swept the heavily fa- sistance to another person in the violation of plaintiffs acting on behalf of the purported vored Detroit Red Wings in four games giv- a provision of this title, or of any rule, regu- plaintiff class who have moved the court to ing the state of New Jersey its first-ever lation, or order promulgated under this title, be appointed to serve as lead plaintiff under championship for a major league team offi- shall be deemed to violate such provision to paragraph (1)(A)(ii) have unanimously se- cially bearing the state’s name: Now, there- the same extent as the person to whom such lected a named plaintiff or plaintiffs to serve fore, be it assistance is provided. No person shall be lia- as lead plaintiff or plaintiffs of the purported Resolved, That the Senate congratulates ble under this subsection based on an omis- plaintiff class, and— the New Jersey Devils for their outstanding sion or failure to act unless such omission or ‘‘(A) if so, shall appoint such named plain- discipline, determination, emotion, and inge- failure constituted a breach of a duty owed tiff or plaintiffs to serve as lead plaintiff or nuity, in winning the 1995 NHL Stanley Cup. by such person.’’. plaintiffs of the purported plaintiff class; or June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9183

‘‘(B) if not, after considering all relevant (c) SECURITIES EXCHANGE ACT OF 1934.— ‘‘(A) defendants shall not be required to factors, including, but not limited to finan- Title I of the Securities Exchange Act of 1934 answer or otherwise respond to any com- cial interest in the relief sought, work done (15 U.S.C. 73a et seq.) is amended by insert- plaint; to develop and prosecute the case, the qual- ing after section 13 the following new sec- ‘‘(B) plaintiffs may file a consolidated or ity of the claim, prior experience represent- tion: amended complaint at any time and may dis- ing classes, possible conflicting interests, ‘‘SEC. 37. APPLICATION OF SAFE HARBOR FOR miss the action or actions at any time with- and exposure to unique defenses, shall select FORWARD-LOOKING STATEMENTS. out sanction; and appoint a named plaintiff or plaintiffs to ‘‘(a) IN GENERAL.—In any implied private ‘‘(C) unless otherwise ordered by the court, serve as lead plaintiff or plaintiffs of the pur- action arising under this title that alleges no formal discovery shall occur, except that ported plaintiff class. that a forward-looking statement concerning parties may propound discovery requests to ‘‘(3) SELECTION OF LEAD COUNSEL.—The lead the future economic performance of an is- third parties to preserve evidence; plaintiff or plaintiffs appointed under para- suer registered under section 12 was materi- ‘‘(D) the parties shall evaluate the merits graph (2) shall, subject to the approval of the ally false or misleading, if a party making a of the action under the supervision of a per- court, select and retain counsel to represent motion in accordance with subsection (b) re- son (hereafter in this section referred to as the class.’’. quests a stay of discovery concerning the the ‘mediator’) agreed upon by them or des- f claims or defenses of that party, the court ignated by the court in the absence of agree- shall grant such a stay until the court has ment, which person may be another district AMENDMENTS SUBMITTED ON ruled on the motion. court judge, any magistrate-judge or a spe- ‘‘(b) SUMMARY JUDGMENT MOTIONS.—Sub- JUNE 27, 1995 cial master, each side having one peremptory section (a) shall apply to any motion for challenge of a mediator designated by the summary judgment made by a defendant as- court by filing a written notice of challenge serting that a forward-looking statement not later than 5 days after receipt of an THE PRIVATE SECURITIES was within the coverage of any rule which order designating the mediator; LITIGATION REFORM ACT OF 1995 the Commission may have adopted concern- ing such predictive statements, if such mo- ‘‘(E) the parties shall promptly provide ac- tion is made not less than 60 days after the cess to or exchange all nonprivileged docu- D’AMATO AMENDMENT NO. 1476 plaintiff commences discovery in the action. ments relating to the allegations in the com- ‘‘(c) DILATORY CONDUCT; DUPLICATIVE DIS- plaint or complaints, and any documents Mr. D’AMATO proposed an amend- COVERY.—Notwithstanding subsection (a) or withheld on the grounds of privilege shall be ment to the bill (S. 240) to amend the (b), the time permitted for a plaintiff to con- sufficiently identified so as to permit the Securities Exchange Act of 1934 to es- duct discovery under subsection (b) may be mediator to determine if they are, in fact, tablish a filing deadline and to provide extended, or a stay of the proceedings may privileged; and certain safeguards to ensure that the be denied, if the court finds that— ‘‘(F) the parties shall exchange damage interests of investors are well pro- ‘‘(1) the defendant making a motion de- studies and such other expert reports as may be helpful to an evaluation of the action on tected under the implied private action scribed in subsection (b) engaged in dilatory or obstructive conduct in taking or opposing the merits, which materials shall be treated provisions of the act; as follows: any discovery; or as prepared and used in the context of settle- On page 121, line 1, delete the word ‘‘expec- ‘‘(2) a stay of discovery pending a ruling on ment negotiations. tation,’’. a motion under subsection (b) would be sub- ‘‘(3) FAILURE TO PRODUCE DOCUMENTS.—Any stantially unfair to the plaintiff or to any party that fails to produce documents rel- SARBANES (AND LAUTENBERG) other party to the action.’’. evant to the allegations of the complaint or complaints during the early evaluation pro- AMENDMENT NO. 1477 cedure described in paragraph (1) may be Mr. SARBANES (for himself and Mr. SARBANES (AND LAUTENBERG) sanctioned by the court pursuant to the Fed- AMENDMENT NO. 1478 LAUTENBERG) proposed an amendment eral Rules of Civil Procedure. Notwithstand- to the bill S. 240, supra; as follows: Mr. SARBANES (for himself and Mr. ing paragraph (2), subject to review by the court, the mediator may order the produc- Beginning on page 112, strike line 1 and all LAUTENBERG) proposed an amendment tion of evidence by any party and, to the ex- that follows through page 126, line 14, and in- to the bill S. 240, supra; as follows: tent necessary properly to evaluate the case, sert the following: On page 114, strike lines 7 and 8, and insert may permit discovery of nonparties and the following: SEC. 105. SAFE HARBOR FOR FORWARD-LOOKING depositions of parties for good cause shown. STATEMENTS. ‘‘(1) made with the actual knowledge that ‘‘(4) EVALUATION BY THE MEDIATOR.— (a) CONSIDERATION OF REGULATORY OR LEG- it was false or misleading; ‘‘(A) IN GENERAL.—If, at the end of the ISLATIVE CHANGES.—In consultation with in- On page 121, strike lines 1 and 2, and insert early evaluation procedure described in para- vestors and issuers of securities, the Securi- the following: graph (1), the action has not been volun- ties and Exchange Commission shall con- ‘‘(1) made with the actual knowledge that tarily dismissed or settled, the mediator sider adopting or amending rules and regula- it was false or misleading; shall evaluate the action as being— tions of the Commission, or making legisla- ‘‘(i) clearly frivolous, such that it can only tive recommendations, concerning— GRAHAM AMENDMENT NO. 1479 (1) criteria that the Commission finds ap- be further maintained in bad faith; propriate for the protection of investors by Mr. GRAHAM proposed an amend- ‘‘(ii) clearly meritorious, such that it can which forward-looking statements concern- ment to the bill S. 240, supra; as fol- only be further defended in bad faith; or ing the future economic performance of an lows: ‘‘(iii) described by neither clause (i) nor issuer of securities registered under section On page 104, after line 22, insert the follow- clause (ii). 12 of the Securities Exchange Act of 1934 will ing: ‘‘(B) WRITTEN EVALUATION.—An evaluation be deemed not be in violation of section 10(b) (c) EARLY EVALUATION PROCEDURES.— required by subparagraph (A) with respect to of that Act; and (1) SECURITIES ACT OF 1933.—Section 20 of the claims against and defenses of each de- (2) procedures by which courts shall timely the Securities Act of 1933 (15 U.S.C. 77t) is fendant shall be issued in writing not later dismiss claims against such issuers of securi- amended by adding at the end the following than 10 days after the end of the early eval- ties based on such forward-looking state- new subsection: uation procedure and provided to the parties. ments if such statements are in accordance ‘‘(j) EARLY EVALUATION PROCEDURES IN The evaluation shall not be admissible in the with any criteria under paragraph (1). CLASS ACTIONS.— action, and shall not be provided to the court (b) COMMISSION CONSIDERATIONS.—In devel- ‘‘(1) IN GENERAL.—In a private action aris- until a motion for sanctions under paragraph oping rules or legislative recommendations ing under this title that is filed as a class ac- (5) is timely filed. in accordance with subsection (a), the Com- tion pursuant to the Federal Rules of Civil ‘‘(5) MANDATORY SANCTIONS.— mission shall consider— Procedure, if the class representatives and ‘‘(A) CLEARLY FRIVOLOUS ACTIONS.—In an (1) appropriate limits to liability for for- each of the other parties to the action agree action that is evaluated by the mediator ward-looking statements; and any party so requests, or if the court under paragraph (4)(A)(i), upon final adju- (2) procedures for making a summary de- upon motion of any party so decides, not dication of the action, the court shall in- termination of the applicability of any Com- later than 60 days after the filing of the class clude in the record specific findings regard- mission rule for forward-looking statements action, the court shall order an early evalua- ing compliance by each party and each attor- early in a judicial proceeding to limit pro- tion procedure. The period of the early eval- ney representing any party with each re- tracted litigation and expansive discovery; uation procedure shall not extend beyond 150 quirement of rule 11(b) of the Federal Rules (3) incorporating and reflecting the days after the filing of the first complaint of Civil Procedure. scienter requirements applicable to implied subject to the procedure. ‘‘(B) MANDATORY SANCTIONS.—If the court private actions under section 10(b); and ‘‘(2) REQUIREMENTS.—During the early makes a finding under subparagraph (A) that (4) providing clear guidance to issuers of evaluation procedure described under para- a party or attorney violated any require- securities and the judiciary. graph (1)— ment of rule 11(b) of the Federal Rules of S 9184 CONGRESSIONAL RECORD — SENATE June 27, 1995 Civil Procedure, the court shall impose sanc- court by filing a written notice of challenge On page 105, line 5, strike ‘‘(j)’’ and insert tions on such party or attorney in accord- not later than 5 days after receipt of an ‘‘(i)’’. ance with rule 11 of the Federal Rules of order designating the mediator; On page 106, line 25, strike ‘‘(l)’’ and insert Civil Procedure. ‘‘(E) the parties shall promptly provide ac- ‘‘(k)’’. ‘‘(C) PRESUMPTION IN FAVOR OF ATTORNEYS’ cess to or exchange all nonprivileged docu- On page 108, line 24, strike ‘‘(k)’’ and insert FEES AND COSTS.— ments relating to the allegations in the com- ‘‘(j)’’. ‘‘(i) IN GENERAL.—Subject to clauses (ii) plaint or complaints, and any documents On page 109, line 8, strike ‘‘(l)’’ and insert and (iii), for purposes of subparagraph (B), withheld on the grounds of privilege shall be ‘‘(k)’’. the court shall adopt a presumption that the sufficiently identified so as to permit the On page 126, line 19, strike ‘‘(m)’’ and insert appropriate sanction for failure of the com- mediator to determine if they are, in fact, ‘‘(l)’’. On page 127, line 6, strike ‘‘(m)’’ and insert plaint to comply with any requirement of privileged; and ‘‘(l)’’. rule 11(b) of the Federal Rules of Civil Proce- ‘‘(F) the parties shall exchange damage dure is an award to the opposing party of all studies and such other expert reports as may of the reasonable attorneys’ fees and other be helpful to an evaluation of the action on BOXER AMENDMENT NO. 1480 expenses incurred as a direct result of the the merits, which materials shall be treated Mrs. BOXER proposed an amendment violation. as prepared and used in the context of settle- to the bill S. 240, supra; as follows: ‘‘(ii) REBUTTAL EVIDENCE.—The presump- ment negotiations. tion described in clause (i) may be rebutted ‘‘(3) FAILURE TO PRODUCE DOCUMENTS.—Any At the appropriate place in title I, insert only upon proof by the party or attorney party that fails to produce documents rel- the following new section: against whom sanctions are to be imposed evant to the allegations of the complaint or SEC. . CONSEQUENCES OF INSIDER TRADING. that— complaints during the early evaluation pro- (a) SECURITIES ACT OF 1933.—Section 13A of ‘‘(I) the award of attorneys’ fees and other cedure described in paragraph (1) may be the Securities Act of 1933, as added by sec- expenses will impose an undue burden on sanctioned by the court pursuant to the Fed- tion 105 of this Act, is amended by adding at that party or attorney; or eral Rules of Civil Procedure. Notwithstand- the end the following new subsection: ‘‘(II) the violation of rule 11(b) of the Fed- ing paragraph (2), subject to review by the ‘‘(h) CONSEQUENCES OF INSIDER TRADING.— ‘‘(1) IN GENERAL.—Notwithstanding sub- eral Rules of Civil Procedure was de court, the mediator may order the produc- section (c), the exclusion from liability pro- minimis. tion of evidence by any party and, to the ex- vided for in subsection (a) does not apply to ‘‘(iii) SANCTIONS.—If the party or attorney tent necessary properly to evaluate the case, a false or misleading forward-looking state- against whom sanctions are to be imposed may permit discovery of nonparties and ment if, in connection with the false or mis- meets its burden under clause (ii), the court depositions of parties for good cause shown. leading forward-looking statement, the is- shall award the sanctions that the court ‘‘(4) EVALUATION BY THE MEDIATOR.— suer or any officer or director of the issuer— deems appropriate pursuant to rule 11 of the ‘‘(A) IN GENERAL.—If, at the end of the ‘‘(A) purchased or sold a material amount Federal Rules of Civil Procedure. early evaluation procedure described in para- of the equity securities of the issuer (or de- ‘‘(6) EXTENSION OF EARLY EVALUATION PE- graph (1), the action has not been volun- rivatives thereof), as reflected in filings with RIOD.—The period of the early evaluation tarily dismissed or settled, the mediator the Commission; and procedure described in paragraph (1) may be shall evaluate the action as being— ‘‘(B) financially benefited from the for- extended by stipulation of all parties. At the ‘‘(i) clearly frivolous, such that it can only ward-looking statement. conclusion of the period, the action shall be further maintained in bad faith; ‘‘(2) DEFINITION.—For purposes of this sub- proceed in accordance with Federal Rules of ‘‘(ii) clearly meritorious, such that it can section, the term ‘material amount’ means— Civil Procedure. only be further defended in bad faith; or ‘‘(A) with respect to an issuer, equity secu- ‘‘(7) FEES.—In a private action described in ‘‘(iii) described by neither clause (i) nor rities of the issuer of any class having a paragraph (1), each side shall bear equally clause (ii). total value of not less than $1,000,000; and the reasonable fees and expenses of the medi- ‘‘(B) WRITTEN EVALUATION.—An evaluation ‘‘(B) with respect to an officer or director ator agreed upon or designated under para- required by subparagraph (A) with respect to of an issuer, holdings of that officer or direc- graph (2)(D), if the mediator is not a judicial the claims against and defenses of each de- tor of any class of the equity securities of officer.’’. fendant shall be issued in writing not later the issuer having a total value of not less (2) SECURITIES EXCHANGE ACT OF 1934—Sec- than 10 days after the end of the early eval- than $50,000.’’. tion 21 of the Securities Act of 1933 (15 U.S.C. uation procedure and provided to the parties. (b) SECURITIES EXCHANGE ACT OF 1934.— 78a) is amended by adding at the end the fol- The evaluation shall not be admissible in the Section 37 of the Securities Exchange Act of lowing new subsection: action, and shall not be provided to the court 1934, as added by section 105 of this Act, is ‘‘(l) EARLY EVALUATION PROCEDURES IN until a motion for sanctions under paragraph amended by adding at the end the following CLASS ACTIONS.— (5) is timely filed. new subsection: ‘‘(1) IN GENERAL.—In any private action ‘‘(5) MANDATORY SANCTIONS.— ‘‘(h) CONSEQUENCES OF INSIDER TRADING.— arising under this title that is filed as a class ‘‘(A) CLEARLY FRIVOLOUS ACTIONS.—In an ‘‘(1) CONSEQUENCES OF INSIDER TRADING.— action pursuant to the Federal Rules of Civil action that is evaluated under paragraph Notwithstanding subsection (c), the exclu- Procedure, if the class representatives and (4)(A)(i) in which final judgment is entered sion from liability provided for in subsection each of the other parties to the action agree against the plaintiff, the plaintiff or plain- (a) does not apply to a false or misleading and any party so requests, or if the court tiff’s counsel shall be liable to the defendant forward-looking statement if, in connection upon motion of any party so decides, not for sanctions as awarded by the court, which with the false or misleading forward-looking later than 60 days after the filing of the class may include an order to pay reasonable at- statement, the issuer or any officer or direc- action, the court shall order an early evalua- torneys’ fees and other expenses, if the court tor of the issuer— tion procedure. The period of the early eval- agrees, based on the entire record, that the ‘‘(A) purchased or sold a material amount uation procedure shall not extend beyond 150 action was clearly frivolous when filed and of the equity securities of the issuer (or de- days after the filing of the first complaint was maintained in bad faith. rivatives thereof), as reflected in filings with subject to the procedure. ‘‘(B) CLEARLY MERITORIOUS ACTIONS.—In an the Commission; and ‘‘(B) financially benefited from the for- ‘‘(2) REQUIREMENTS.—During the early action that is evaluated under paragraph evaluation procedure described under para- (4)(A)(ii) in which final judgment is entered ward-looking statement. ‘‘(2) DEFINITION.—For purposes of this sub- graph (1)— against the defendant, the defendant or de- section, the term ‘material amount’ means— ‘‘(A) defendants shall not be required to fendant’s counsel shall be liable to the plain- ‘‘(A) with respect to an issuer, $1,000,000 answer or otherwise respond to any com- tiff for sanctions as awarded by the court, worth of any class of the equity securities of plaint; which may include an order to pay reason- the issuer; and ‘‘(B) plaintiffs may file a consolidated or able attorneys’ fees and other expenses, if ‘‘(B) with respect to an officer or director amended complaint at any time and may dis- the court agrees, based on the entire record, of an issuer, $50,000 worth of the holdings of miss the action or actions at any time with- that the action was clearly meritorious and that person of any class of the equity securi- out sanction; was defended in bad faith. ties of the issuer.’’. ‘‘(C) unless otherwise ordered by the court, ‘‘(6) EXTENSION OF EARLY EVALUATION PE- Amend the table of contents accordingly. no formal discovery shall occur, except that RIOD.—The period of the early evaluation parties may propound discovery requests to procedure described in paragraph (1) may be BIDEN AMENDMENT NO. 1481 third parties to preserve evidence; extended by stipulation of all parties. At the ‘‘(D) the parties shall evaluate the merits conclusion of the period, the action shall Mr. BIDEN proposed an amendment of the action under the supervision of a per- proceed in accordance with Federal Rules of to the bill S. 240, supra; as follows: son (hereafter in this section referred to as Civil Procedure. At the appropriate place insert: the ‘mediator’) agreed upon by them or des- ‘‘(7) FEES.—In a private action described in SEC. . AMENDMENT TO RACKETEER INFLU- ignated by the court in the absence of agree- paragraph (1), each side shall bear equally ENCED AND CORRUPT ORGANIZA- ment, which person may be another district the reasonable fees and expenses of the medi- TIONS ACT. court judge, any magistrate-judge or a spe- ator agreed upon or designated under para- Section 1964(c) of title 18, United States cial master, each side having one peremptory graph (2)(D), if the mediator is not a judicial Code, is amended by inserting before the pe- challenge of a mediator designated by the officer.’’. riod ‘‘, except that no person may rely upon June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9185 conduct that would have been actionable as limited to materials directly relevant to ‘‘(I) prohibits’’. fraud in the purchase of sale of securities to facts expressly pleaded in the complaint; and On page 115, line 1, strike ‘‘(ii) requires’’ establish a violation of section 1962’’, pro- ‘‘(B) except as provided in subparagraphs and insert the following: vided however that this exception shall not (A) and (B), or otherwise expressly provided ‘‘(II) requires’’. apply if any participant in the fraud is crimi- in this title, discovery shall be conducted On page 115, line 4, strike ‘‘(iii) deter- nally convicted in connection therewith, in pursuant to the Federal Rules of Civil Proce- mines’’ and insert the following: which case the statute of limitations shall dure.’’. ‘‘(III) determines’’. start to run on the date that the conviction On page 111, strike lines 1 through 7, and On page 116, between lines 11 and 12, insert because final. insert the following: ‘‘(2) STAY OF DISCOVERY.— the following: ‘‘(A) IN GENERAL.—In any private action ‘‘(D) made in connection with an initial BINGAMAN (AND BRYAN) arising under this title, the court may stay public offering; AMENDMENT NO. 1482 discovery upon motion of any party only if On page 116, line 12, strike ‘‘(D)’’ and insert Mr. BINGAMAN (for himself and Mr. the court determines that the stay of discov- ‘‘(E)’’. BRYAN) proposed an amendment to the ery— On page 116, line 17, strike ‘‘(E)’’ and insert bill S. 240, supra; as follows: ‘‘(i) would avoid waste, delay, duplication, ‘‘(F)’’. or unnecessary expense; and On page 105, line 25, insert ‘‘, or the respon- On page 118, line 13, before the period in- ‘‘(ii) would not prejudice any plaintiff. sert ‘‘that are not compensated through final sive pleading or motion’’ after ‘‘complaint’’. ‘‘(B) ADDITIONAL LIMITATIONS ON DISCOV- On page 107, line 20, insert ‘‘, or the respon- adjudication or settlement of a private ac- ERY.—In any private action arising under sive pleading or motion’’ after ‘‘complaint’’. tion brought under this title arising from this title— the same violation’’. ‘‘(i) notwithstanding any stay of discovery On page 121, line 7, strike ‘‘has been,’’. SPECTER AMENDMENT NOS. 1483– issued in accordance with subparagraph (A), On page 121, strike line 9, and insert the the court may permit such discovery as may 1485 following: ‘‘made— be necessary to permit a plaintiff to prepare Mr. SPECTER proposed three amend- an amended complaint in order to meet the ‘‘(i) was convicted of any felony or mis- ments to the bill S. 240, supra; as fol- pleading requirements of this section; demeanor’’. lows: ‘‘(ii) prior to the filing of a responsive On page 121, strike line 11 and insert the AMENDMENT NO. 1483 pleading to the complaint, discovery shall be following: ‘‘15(b)(4)(B); or Beginning on page 105, strike line 1 and all limited to materials directly relevant to ‘‘(ii) has been made the subject of a ju-’’. that follows through page 108, line 17, and in- facts expressly pleaded in the complaint; and On page 121, line 14, strike ‘‘(i) prohibits’’ sert the following: ‘‘(iii) except as provided in clauses (i) and and insert the following: SEC. 103. SANCTIONS FOR ABUSIVE LITIGATION. (ii), or otherwise expressly provided in this ‘‘(I) prohibits’’. (a) SECURITIES ACT OF 1933.—Section 20 of title, discovery shall be conducted pursuant On page 121, line 16, strike ‘‘(ii) requires’’ the Securities Act of 1933 (15 U.S.C. 77t) is to the Federal Rules of Civil Procedure.’’. and insert the following: amended by adding at the end the following ‘‘(II) requires’’. AMENDMENT NO. 1485 new subsection: On page 121, line 19, strike ‘‘(iii) deter- ‘‘(j) SANCTIONS FOR ABUSIVE LITIGATION.— On page 110, strike lines 12 through 19, and mines’’ and insert the following: In any private action arising under this title, insert the following: ‘‘(III) determines’’. if an abusive litigation practice relating to ‘‘(b) REQUIRED STATE OF MIND.— On page 122, between lines 20 and 21, insert the action is brought to the attention of the ‘‘(1) IN GENERAL.—In any private action the following: court, by motion or otherwise, the court arising under this title in which the plaintiff shall promptly— may recover money damages only on proof ‘‘(D) made in connection with an initial ‘‘(1) determine whether or not to impose that the defendant acted with a particular public offering; sanctions under rule 11 or rule 26(g)(3) of the state of mind, the complaint shall, with re- On page 122, line 21, strike ‘‘(D)’’ and insert Federal Rules of Civil Procedure, section spect to each act or omission alleged to vio- ‘‘(E)’’. 1927 of title 28, United States Code, or other late this title, specifically allege facts giving On page 123, line 1, strike ‘‘(E)’’ and insert authority of the court; and rise to a strong inference that the defendant ‘‘(F)’’. ‘‘(2) include in the record findings of fact acted with the requested state of mind. On page 124, line 21, insert before the pe- and conclusions of law to support such deter- ‘‘(2) STRONG INFERENCE OF FRAUDULENT IN- riod ‘‘that are not compensated through mination.’’. TENT.—For purposes of paragraph (1), a final adjudication or settlement of a private (b) SECURITIES EXCHANGE ACT OF 1934.— strong inference that the defendant acted action brought under this title arising from Section 21 of the Securities Exchange Act of with the required state of mind may be es- the same violation’’. 1934 (15 U.S.C. 78u) is amended by adding at tablished either— On page 128, line 25, strike ‘‘the liability the end the following new subsection: ‘‘(A) by alleging facts to show that the de- of’’ and insert ‘‘if’’. ‘‘(l) SANCTIONS FOR ABUSIVE LITIGATION.— fendant had both motive and opportunity to On page 128, line 25, strike ‘‘offers or sells’’ In any private action arising under this title, commit fraud; or and insert ‘‘offered or sold’’. if an abusive litigation practice relating to ‘‘(B) by alleging facts that constitute On page 129, line 1, strike ‘‘shall be limited the action is brought to the attention of the strong circumstantial evidence of conscious to damages if that person’’. court, by motion or otherwise, the court misbehavior or recklessness by the defend- On page 129, line 9, strike ‘‘and such por- shall promptly— ant.’’. ‘‘(1) determine whether or not to impose tion or all of such amount’’ and insert ‘‘then sanctions under rule 11 or rule 26(g)(3) of the such portion or amount, as the case may Federal Rules of Civil Procedure, section D’AMATO (AND SARBANES) be,’’. 1927 of title 28, United States Code, or other AMENDMENT NO. 1486 On page 131, lines 19 and 20, strike ‘‘that person’s degree’’ and insert ‘‘the percent- authority of the court; and Mr. BENNETT (for Mr. D’AMATO for ‘‘(2) include in the record findings of fact age’’. himself and Mr. SARBANES) proposed an and conclusions of law to support such deter- On page 131, line 20, insert ‘‘of that person’’ mination.’’. amendment to the bill S. 240, supra; as before the comma. follows: f AMENDMENT NO. 1484 On page 84, line 11, strike ‘‘, if’’ and insert Beginning on page 108, strike line 24 and ‘‘in which’’. NOTICE OF HEARING all that follows through page 109, line 4, and On page 111, beginning on line 2, strike insert the following: ‘‘during the pendency of any motion to dis- COMMITTEE ON INDIAN AFFAIRS ‘‘(k) STAY OF DISCOVERY.— miss,’’. Mr. MCCAIN. Mr. President, I would ‘‘(1) IN GENERAL.—In any private action On page 111, line 4, insert ‘‘during the pend- like to announce that the Senate Com- ency of any motion to dismiss,’’ after arising under this title, the court may stay mittee on Indian Affairs will be holding discovery upon motion of any party only if ‘‘stayed’’. the court determines that the stay of discov- On page 114, line 13, strike ‘‘has been,’’. a hearing on Wednesday, June 28, 1995, ery— On page 114, strike line 15 and insert the beginning at 9:45 a.m., in room 485 of ‘‘(A) would avoid waste, delay, duplication, following: ‘‘made— the Russell Senate Office Building on or unnecessary expense; and ‘‘(i) was convicted of any felony or mis- S. 814, a bill to provide for the reorga- ‘‘(B) would not prejudice any plaintiff. demeanor’’. nization of the Bureau of Indian Af- ‘‘(2) ADDITIONAL LIMITATIONS ON DISCOV- On page 114, strike line 17 and insert the fairs, and for other purposes. ERY.—In any private action arising under following: ‘‘15(b)(4)(B); or this title— ‘‘(ii) has been made the subject of a ju-’’. Those wishing additional information ‘‘(A) prior to the filing of a responsive On page 114, line 20, strike ‘‘(i) prohibits’’ should contact the Committee on In- pleading to the complaint, discovery shall be and insert the following: dian Affairs at 224–2251. S 9186 CONGRESSIONAL RECORD — SENATE June 27, 1995 AUTHORITY FOR COMMITTEES TO SUBCOMMITTEE ON SOCIAL SECURITY AND grown nearly fourfold to 184 member MEET FAMILY POLICY states. Many of the old threats to Mr. BENNETT. Mr. President, I ask peace have receded only to be replaced COMMITTEE ON ENVIRONMENT AND PUBLIC unanimous consent that the Sub- WORKS by new and more intractable ones. And, committee on Social Security and Mr. BENNETT. Mr. President, I ask despite the many criticisms leveled Family Policy of the Committee on Fi- unanimous consent that the full Com- against the United Nations, member nance be permitted to meet on Tues- mittee on Environment and Public states have largely heeded the words day, June 27, 1995, beginning at 10:00 Works be granted permission to meet expressed by President Truman, in a.m., in room SD–215, to conduct a Tuesday, June 27, at 9:30 a.m., to con- speaking about the charter that had hearing on the solvency of the Social duct an oversight hearing on proposals just been signed, ‘‘You have created a Security Trust Funds. to supplement the legal framework for great instrument for peace and secu- The PRESIDING OFFICER. Without rity and human progress in the world. private property interests, with pri- objection, it is so ordered. mary emphasis on the operation of The world must now use it’’. Federal environmental laws. SUBCOMMITTEE ON STRATEGIC FORCES Much has been accomplished by the The PRESIDING OFFICER. Without Mr. BENNETT. Mr. President, I ask United Nations during its first 50 years. objection, it is so ordered. unanimous consent that the Sub- Even its severest critics have to ac- committee on Strategic Forces be au- knowledge that during the cold war, COMMITTEE ON THE JUDICIARY thorized to meet on Tuesday, June 27, the United Nations served to mitigate Mr. BENNETT. Mr. President, I ask 1995, at 6:00 p.m., to markup the De- the ideological conflict between East unanimous consent that the Commit- partment of Defense Authorization Act and West that threatened the world tee on the Judiciary be authorized to for fiscal year 1996. with nuclear chaos. It also smoothed meet during the session of the Senate The PRESIDING OFFICER. Without the path for new nation states seeking on Tuesday, June 27, 1995, at 9:30 a.m., objection, it is so ordered. to break with old, outdated colonial to hold a hearing on Department of f empires. Justice oversight. The United Nation’s various affiliate The PRESIDING OFFICER. Without ADDITIONAL STATEMENTS agencies have served to make the world objection, it is so ordered. a better place to live. The world health COMMITTEE ON THE JUDICIARY organization, to mention but one, has Mr. BENNETT. Mr. President, I ask THE U.N. CHARTER—50 YEARS OF been a major player in the world-wide unanimous consent that the Commit- EXPERIENCE campaign to eradicate smallpox, mea- tee on the Judiciary be authorized to ∑ Mr. DODD. Mr. President, yesterday, sles, polio, and other dreaded but pre- meet during the session of the Senate June 26, 1995, marked the 50-year anni- ventable diseases. The accomplish- on Tuesday, June 27, 1995, at 2:15 p.m., versary of the signing of the U.N. Char- ments of the United Nations have been to hold a hearing on judicial nominees. ter. To commemorate the event, Presi- recognized and honored by the world The PRESIDING OFFICER. Without dent Clinton traveled to San Francisco community. On four separate occa- objection, it is so ordered. to participate in ceremonies at the sions, U.N. activities and agencies have SPECIAL COMMITTEE ON AGING very site where representatives of some been recipients of Nobel peace prizes— Mr. BENNETT. Mr. President, I ask 50 nations first gathered to hammer the blue helmet peacekeepers, the U.N. unanimous consent that the Special out that historic document. Children’s Fund, the U.N. Office of Committee on Aging be authorized to Mr. President, I believed that Presi- High Commissioner for Refugees. meet during the session of the Senate dent Clinton spoke for all of us yester- Clearly the world is a different place on Tuesday, June 27, at 9:30 a.m., to day when he said: than it was 50 years age. The acts of hold a hearing to discuss neurological Today we honor the men and women who aggression and threats to peace once diseases. gave shape to the United Nations. We cele- posed by the East/West conflict have The PRESIDING OFFICER. Without brate 50 years of achievement. We commit been replaced by a growing number of ourselves to real reforms. We reject the siren objection, it is so ordered. equally bedeviling ethnic rivalries, song of the new isolationists. We set a clear civil wars and humanitarian calamities SUBCOMMITTEE ON AIRLAND FORCES agenda worthy of the visions of our founders. throughout the globe. The demands on Mr. BENNETT. Mr. President, I ask The measure of our generation will be the United Nations for policing these unanimous consent that the Sub- whether we give up because we cannot conflicts, for marshaling humanitarian committee on Airland Forces be au- achieve a perfect world or strive on to build a better world. aid, for dispensing economic and social thorized to meet on Tuesday, June 27, services in response to these events, 1995, at 2:00 p.m., to markup the De- In recalling that historic day, Presi- have grown geometrically—and so too partment of Defense Authorization Act dent Clinton reminded listeners as well have the financial costs associated for fiscal year 1996. that, ‘‘The 50 nations who came here with them. The PRESIDING OFFICER. Without ** * to lift the world from the ashes of objection, it is so ordered. war * * * included giants of diplomacy Some of the criticism leveled against and untested leaders of infant nations. the United Nations have been unfair. In SUBCOMMITTEE ON READINESS They were separated by tradition, race the final analysis, the United Nations Mr. BENNETT. Mr. President, I ask and language, sharing only a vision of is only as strong and decisive as its unanimous consent that the Sub- a better safer future.’’ It was that membership. In the final analysis it committee on Readiness be authorized shared vision, in the final analysis, can only continue to undertake activi- to meet on Tuesday, June 27, 1995, at that made it possible to set aside dif- ties that its membership is willing and 9:00 a.m., to markup the Department of ferences, grievances and suspicions. It able to support, both financially and Defense Authorization Act for fiscal was that shared vision that empowered politically. year 1996. conference participants to craft a char- However, the United Nations and The PRESIDING OFFICER. Without ter that President Truman described U.N. management must share some of objection, it is so ordered. as, ‘‘a declaration of great faith by the the responsibility for the criticisms SUBCOMMITTEE ON SEAPOWER nations of the Earth—faith that war is that have arisen. Some of the more Mr. BENNETT. Mr. President, I ask not inevitable, faith that peace can be problematic endeavors clearly fall in unanimous consent that the Sub- maintained.’’ I believe that all freedom the peacekeeping arena—Bosnia, So- committee on Seapower be authorized loving peoples of the world continue to malia, and others. Organizationally to meet on Tuesday, June 27, 1995, at share that same faith and vision today. and managerially there have been prob- 4:00 p.m., to markup the Department of Much has transpired since that day, lems, as well, throughout the U.N. sys- Defense Authorization Act for fiscal in 1945, when the 50 founding nations of tem. Historically, internal financial year 1996. the United Nations pledged their faith controls and safeguards have been in- The PRESIDING OFFICER. Without and cooperation in this new world or- adequate and ineffective in ensuring objection, it is so ordered. ganization. Today, the U.N. family has that members’ contributions have been June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9187 judiciously spent, with U.N. procure- very day, a Russian spacecraft and an Amer- progress that advances our nation’s interest ment fairly allocated among contribu- ican spacecraft are preparing to link in orbit and, indeed, the interest of people every- tors. some 240 miles above the Earth. From Jeri- where. From President Truman in Korea to There is clearly consensus within the cho to Belfast, ancient enemies are search- President Bush in the Persian Gulf, America ing together for peace. On every continent has built United Nations’ military coalitions U.N. membership that reforms should nations are struggling to embrace democ- to contain aggressors. U.N. forces also often and must be undertaken. The United racy, freedom and prosperity. New tech- pick up where United States’ troops have Nations has already made progress in nologies move people and ideas around the taken the lead. implementing some of these reforms. world, creating vast new reservoirs of oppor- As the Secretary of State said, we saw it Still more will have to occur in order tunity. just yesterday, when Haiti held parliamen- to strengthen its capacity to address Yet we know that these new forces of inte- tary and local elections with the help of U.N. gration also carry within them the seeds of the challenges of the coming decade. personnel. We saw the U.N. work in partner- disintegration and destruction. New tech- ship with the United States and the people of Despite its shortcomings and problems, nologies and greater openness make all our Haiti, as they labor to create a democracy. however, I continue to believe, Mr. borders more vulnerable to terrorists, to And they have now been given a second President, that President Truman’s dangerous weapons, to drug traffickers. chance to renew that promise. fundamental conclusion about the Newly-independent nations offer rip targets On every continent the United Nations has United Nations some 50 years ago re- for international terminals and nuclear played a vital role in making people more mains true today: ‘‘The charter of the smugglers. Fluid capital markets make it free and more secure. For decades, the U.N. easier for nations to build up their econo- United Nations which you have signed fought to isolate South Africa, as that re- mies, but also make it much easier for one gime perpetuated apartheid. Last year, is a solid structure upon which we can nation’s troubles first to be exaggerated, under the watchful eyes of U.N. observers, build a better world.’’ We must endeav- then to spread to other nations. millions of South Africans who had been or to do just that—build a better and Today, to be sure, we face no Hitler, no disenfranchised for life cast their first votes safer world for our children and grand- Stalin, but we do have enemies—enemies for freedom. children. A vibrant and effective Unit- who share their contempt for human life and In Namibia, Mozambique, and soon we hope ed Nations can help us to accomplish human dignity and the rule of law; enemies in Angola, the United Nations is helping peo- who put lethal technology to lethal use, who that goal. ple to bury decades of civil strife and turn seek personal gains in age-old conflicts and their energies into building new democratic Mr. President, I ask that the full text new divisions. nations. In Cambodia, where a brutal regime of President Clinton’s remarks yester- Our generation’s enemies are the terrorists left more than one million dead in the Kill- day in San Francisco be printed in the and their outlaw nation sponsors—people ing Fields, the U.N. helped hundreds of thou- RECORD. who kill children or turn them into orphans; sands of refugees return to their native land, The remarks follow: people who target innocent people in order and stood watch over democratic elections to prevent peace; people who attack peace- REMARKS BY THE PRESIDENT that brought 90 percent of the people to the makers, as our friend President Mubarak polls. In El Salvador, the U.N. brokered an Thank you very much. Secretary Chris- was attacked just a few hours ago; people end to 12 years of bloody civil war, and topher, Mr. Secretary General, Ambassador who in the name of nationalism slaughter stayed on to help reform the army and bring Albright, Bishop Tutu. My good friend, Maya those of different faiths or tribes, and drive justice to the citizens and open the doors of Angelou, thank you for your magnificent their survivors from their own homelands. democracy. Their reach is increased by technology. poem. (Applause.) Delegates to the Charter From the Persian Gulf to the Caribbean, Their communication is abetted by global Conference, distinguished members of the U.N. economic and political sanctions have media. Their actions reveal the age-old lack Diplomatic Corps, the President of Poland, proved to be a valuable means short of mili- of conscience, scruples and morality which members of Congress, honored guests, Mayor tary action to isolate regimes and to make have characterized the forces of destruction Jordan, Mr. Shorenstein, people of San Fran- aggressors and terrorists pay at least a price throughout history. cisco, and friends of the United Nations: for their actions: In Iraq, to help stop that The 800 delegates from 50 nations who Today, the threat to our security is not in an enemy silo, but in the briefcase or the car nation from developing weapons of mass de- came here 50 years ago to lift the world from struction, or threatening its neighbors the ashes of war and bring life to the dreams bomb of a terrorist. Our enemies are also international criminals and drug traffickers again. In the Balkans, to isolate aggressors; of peacemakers included both giants of di- in North Africa, to pressure Libya to turn plomacy and untested leaders of infant na- who threaten the stability of new democ- racies and the future of our children. Our en- over for trial those indicted in the bombing tions. They were separated by tradition, race of Pan Am flight 103. and language, sharing only a vision of a bet- emies are the force of natural destruction— encroaching deserts that threaten the The record of the United Nations includes ter, safer future. On this day 50 years ago, a proud battle for child survival, and against the dreams President Roosevelt did not live Earth’s balance, famines that test the human spirit, deadly new diseases that en- human suffering and disease of all kinds. to see of a democratic organization of the Every year UNICEF oral vaccines save the world was launched. danger whole societies. So, my friends, in this increasingly inter- lives of three million children. Last year The Charter the delegate signed reflected dependent world, we have more common op- alone the World Food Program, using the the harsh lessons of their experience; the ex- portunities and more common enemies than contributions of many governments includ- perience of the ’30s, in which the world ever before. It is, therefore, in our interest to ing our own, fed 57 million hungry people. watched and reacted too slowly to fascist ag- face them together as partners, sharing the The World Health Organization has elimi- gression, bringing millions sacrificed on the burdens and costs, and increasing our nated smallpox from the face of the Earth, battlefields and millions more murdered in chances of success. and is making great strides in its campaign the death chambers. Just months before his death, President to eliminate polio by the year 2000. It has Those who had gone through this and the Roosevelt said, ‘‘We have learned that we helped to contain fatal diseases like the second world war knew that celebrating vic- cannot live alone at peace, that our own Ebola virus that could have threatened an tory was not enough; that merely punishing well-being is dependent on the well-being of entire continent. the enemy was self-defeating; that instead other nations far away.’’ Today, more than To millions around the world, the United the world needed an effective and permanent ever, those words ring true. Yet some here in Nations is not what we see on our news pro- system to promote peace and freedom for ev- our own country, where the United Nations grams at night. Instead it’s the meal that eryone. Some of those who worked at that was founded, dismissed Roosevelt’s wisdom. keeps a child from going to bed hungry, the historic conference are still here today, in- Some of them acknowledge that the United knowledge that helps a farmer coax strong cluding our own Senator Claiborne Pell, who States must play a strong role overseas, but crops from hard land, the shelter that keeps to this very day, every day, carries a copy of refuse to supply the nonmilitary resources a family together when they’re displaced by the U.N. Charter in his pocket. (Applause.) our nation needs to carry on its responsibil- war or natural disasters. I would last like to ask all of the delegates ities. Others believe that outside our border In the last 50 years, these remarkable sto- to the original conference who are here America should only act alone. ries have been too obscured, and the capacity today to rise and be recognized. Would you Well, of course, the United States must be of the United Nations to act too limited by please stand? (Applause.) prepared to act alone when necessary, but we the Cold War. As colonial rule broke down, San Francisco gave the world renewed con- dare not ignore the benefits that coalitions differences between developing and industri- fidence and hope for the future. On that day bring to this nation. We dare not reject dec- alized nations and regional rivalries added President Truman said, ‘‘This is proof that ades of bipartisan wisdom. We dare not re- new tensions to the United Nations so that nations, like men, can state their dif- ject decades of bipartisan support for inter- too often there was too much invective and ferences, can face them, and than can find national cooperation. Those who would do too little debate in the general assembly. common ground on which to stand.’’ Five so, these new isolationists, dismiss 50 years But now the end of the Cold War, the decades later, we see how very much the of hard evidence. strong trend toward democratic ideals world has changed. The Cold War has given In those years we’ve seen the United Na- among all nations, the emergence of so many way to freedom and cooperation. On this tions compile a remarkable record of problems that can best be met by collective S 9188 CONGRESSIONAL RECORD — SENATE June 27, 1995 action, all these things enable the United here in the United States, turning our back the least noticed of the U.N.’s missions; its Nations at this 50-year point finally to fulfill on the U.N. and going it alone will lead to unmatched efforts on the front lines of the the promise of its founders. far more economic, political and military battle for child survival and against disease But if we want the U.N. to do so, we must burdens on our people in the future and and human suffering. face the fact that for all its successes and all would ignore the lessons of our own history. And finally, let us vote to make the United its possibilities, it does not work as well as (Applause.) Nations an increasing strong voice for the it should. The United Nations must be re- Instead, on this 50th anniversary of the protection of fundamental human dignity formed. In this age of relentless change, suc- charter signing, let us renew our vow to live and human rights. After all, they were at the cessful governments and corporations are together as good neighbors. And let us agree core of the founding of this great organiza- constantly reducing their bureaucracies, set- on a new United Nations agenda to increase tion. (Applause.) ting clearer priorities, focusing on targeted confidence and ensure support for the United Today we honor the men and women who results. Nations, and to advance peace and prosperity gave shape to the United Nations. We cele- In the United States we have eliminated for the next 50 years. brate 50 years of achievement. We commit hundreds of programs, thousands of regula- First and foremost, the U.N. must ourselves to real reforms. We reject the siren tions. We’re reducing our government to its strengthen its efforts to isolate states and song of the new isolationists. We set a clear smallest size since President Kennedy served people who traffic in terror, and support agenda worthy of the vision of our founders. here, while increasing our efforts in areas those who continue to take risks for peace in The measure of our generation will be most critical to our future. The U.N. must the face of violence. The bombing in Okla- whether we give up because we cannot take similar steps. homa City, the deadly gas attack in Tokyo, achieve a perfect world or strive on to build Over the years it has grown too bloated, the struggles to establish peace in the Mid- a better world. too often encouraging duplication, and dle East and in Northern Ireland—all of Fifty years ago today, President Truman spending resources on meetings rather than these things remind us that we must stand reminded the delegates that history had not results. As its board of directors, all of us— against terror and support those who move ended with Hitler’s defeat. He said, it is easi- we, the member states—must create a U.N. away from it. Recent discoveries of labora- er to remove tyrants and destroy concentra- that is more flexible, that operates more rap- tories working to produce biological weapons tion camps than it is to kill the ideas which idly, that wastes less and produces more, and for terrorists demonstrate the dangerous give them birth. Victory on the battlefield most importantly, that inspires confidence link between terrorism and the weapons of was essential, but it is not good enough for among our governments and our people. mass destruction. a lasting, good peace. (Applause.) In the last few years we have seen some In 1937, President Roosevelt called for a Today we know that history has not ended good reforms—a new oversight office to hold quarantine against aggressions, to keep the with the Cold War. We know, and we have down costs, a new system to review person- infection of fascism from seeping into the learned from painful evidence, that as long nel, a start toward modernization and pri- bloodstream of humanity. Today, we should as there are people on the face of the Earth, vatization. But we must do more. quarantine the terrorists, the terrorist imperfection and evil will be a part of human The United Nations supports the proposal groups, and the nations that support terror- nature; there will be killing, cruelty, self-de- of the President of the General Assembly, ism. (Applause.) structive abuse of our natural environment, Mr. Essyi, who spoke so eloquently here ear- Where nations and groups honestly seek to denial of the problems that face us all. But lier this morning, to prepare a blueprint for reform, to change, to move away from the we also know that here today, in this his- renewing the U.N. and to approve it before killing of innocents, we should support them. toric chamber, the challenge of building a the 50th General Assembly finishes its work But when they are unrepentant in the deliv- good and lasting peace is in our hands and next fall. ery of death, we should stand tall against success is within our reach. We must consider major structural them (Applause.) My friends, there is no easy Let us not forget that each child saved, changes. The United Nations simply does not way around the hard question: If nations and each refugee housed, each disease prevented, need a separate agency with its own acro- groups are not willing to move away from each barrier to justice brought down, each nym, stationery and bureaucracy for every the delivery of death, we should put aside sword turned into a ploughshare, brings us problem. The new U.N. must peel off what short-term profits for the people in our coun- closer to the vision of our founders—closer doesn’t work and get behind what will. tries to stop, stop their conduct. (Applause.) to peace, closer to freedom, closer to dignity. We must also realize, in particular, the Second, the U.N. must continue our efforts (Applause.) limits to peacekeeping and not ask the Blue to stem the proliferation of weapons of mass So my fellow citizens of the world, let us Helmets to undertake missions they cannot destruction. There are some things nations not lose heart. Let us gain renewed strength be expected to handle. Peacekeeping can can do on their own. The U.S. and Russia and energy and vigor from the progress only succeed when the parties to a conflict today are destroying our nuclear arsenals which has been made and the opportunities understand they cannot profit from war. We rapidly. (Applause.) But the U.N. must also which are plainly before us. Let us say no to have too often asked our peacekeepers to play a role. We were honored to help secure isolation, yes to reform; yes to a brave, am- work miracles while denying them the mili- an indefinite extension of the Nuclear Non- bitious new agenda; most of all, yes to the tary and political support required, and the Proliferation Treaty under U.N. auspices. dream of the United Nations. modern command-and-control systems they (Applause.) Thank you.∑ need to do their job as safely and effectively We rely on U.N. agencies to monitor na- f as possible. Today’s U.N. must be ready to tions bent on acquiring nuclear capabilities. handle tomorrow’s challenges. Those of us We must work together on the Chemical TRIBUTE TO GEN. GORDON R. SUL- who most respect the U.N. must lead the Weapons Convention. We must strengthen LIVAN, USA, ON HIS RETIRE- charge of reform. our common efforts to fight biological weap- Not all the critics of today’s United Na- ons. We must do everything we can to limit MENT tions are isolationists. Many are supporters the spread of fissile materials. We must work ∑ Mr. NUNN. Mr. President, as the U.S. who gladly would pay for the U.N.’s essential on conventional weapons like the land mines Army undergoes a change in its top work if they were convinced their money was that are the curse of children the world over. military leadership, I would like to being well-spent. But I pledge to all of you, (Applause.) And we must complete a com- recognize the outstanding service of as we work together to improve the United prehensive nuclear test ban treaty. (Ap- Nations, I will continue to work to see that plause.) the Army’s 32d Chief of Staff, Gen. Gor- the United States takes the lead in paying Third, we must support through the United don R. Sullivan. Throughout his tenure its fair share of our common load. (Ap- Nations the fight against manmade and nat- as the Army Chief of Staff, General plause.) ural forces of disintegration, from crime syn- Sullivan has worked closely with the Meanwhile, we must all remember that the dicates and drug cartels, to new diseases and Congress and we have found his profes- United Nations is a reflection of the world it disappearing forests. These enemies are elu- sional military advice invaluable. He is represents. Therefore, it will remain far from sive; they cross borders at will. Nations can retiring from the Army after more perfect. It will not be able to solve all prob- and must oppose them alone. But we know, than 35 years of service to our Nation. lems. But even those it cannot solve, it may and the Cairo Conference reaffirmed, that well be able to limit in terms of the scope the most effective opposition requires strong General Sullivan has had the and reach of the problem, and it may well be international cooperation and mutual sup- unenviable task of leading the Army able to limit the loss of human life until the port. through its largest downsizing in 50 time for solution comes. Fourth, we must reaffirm our commitment years, while simultaneously preparing So just as withdrawing from the world is to strengthen U.N. peacekeeping as an im- the Army for the new challenges of the impossible, turning our backs on the U.N. is portant tool for deterring, containing and next century. As a testament to the no solution. It would be shortsighted and ending violent conflict. The U.N. can never success of his efforts, General Sullivan self-destructive. It would strengthen the be an absolute guarantor of peace, but it can forces of global disintegration. It would reduce human suffering and advance the odds is leaving an Army that is trained, dis- threaten the security, the interest and the of peace. ciplined, and proud. His focus on tak- values of the American people. So I say espe- Fifth—you may clap for that—(applause.) ing care of soldiers and their families, cially to the opponents of the United Nations Fifth, we must continue what is too often on education, and on promoting both June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9189 realistic field exercises and increasing the Stanley Cup playoffs, there were a Reagan had appointed him the previous the use of simulation has made the host of other heroes without whom the year. Characteristically, the Chief Army ready for what the 21st century Devils would never have made it as far threw himself into that effort with the may bring. General Sullivan has put as they did. Captain and defenseman great energy and enthusiasm he ap- forth a vision of the Army for the 21st Scott Stevens, who shut down the op- plied to all of his pursuits. I recall cor- century that will be both the guidepost position’s superstars, goaltender Mar- responding with him about the Com- for years to come. He can take great tin Brodeur, the second-year phenom mission’s progress and his many ideas pride in both the Army’s past accom- who has emerged as one of the best for increasing public appreciation for plishments and future preparedness. goaltenders in the NHL, and native the Constitution in its bicentennial General Sullivan has essentially led New Jerseyan Jim Dowd from Brick, year. Among its good works, the Com- the Army into the 21st century. who scored a clutch goal to win game mission produced the excellent pocket- Throughout his career, General Sulli- two, are just a few examples. sized Constitutions that are available van has distinguished himself in nu- The Devils played ultimate team in Senate offices. I have taken to car- merous command and staff positions hockey in winning the Stanley Cup. rying a copy with me, and I know the with U.S. forces stationed both over- Their now infamous neutral-zone trap distinguished Senator from West Vir- seas and in the Continental United defensive system put the Red Wings in ginia has as well. States. In Asia, he served a tour of a stranglehold tighter than any octopi In his Foreword to the pocket Con- duty in Korea and two tours of duty in their fans could throw onto the ice. stitution, Chief Justice Burger wrote Vietnam. In Europe, his assignments In closing, Mr. President, I would that our constitutional system: included 3d Armored Division’s Chief of like to once again offer congratula- [D]oes not always provide tidy results; it Staff and the VII Corps operations offi- tions to our Devils. Success in the pro- depends on a clash of views in debate and on cer. From July 1985 to March 1987 Gen- fessional sports arena, like many other bargain and compromise. For 200 years this eral Sullivan served on the NATO staff endeavors, requires a great deal of Constitution’s ordered liberty has unleashed as the Deputy Chief of Staff for Sup- dedication, hard work, and courage. the energies and talents of people to create a port of Central Army Group in Ger- And that is our New Jersey Devils. I good life. many. am very proud to have them represent Warren Burger created just such a General Sullivan’s stateside assign- our State.∑ good life through his own indomitable ments included serving as the assistant f energies and talents. He came from commandant of the Armor School at humble roots in St. Paul, MN, attended Fort Knox, KY, and deputy com- THE DEATH OF FORMER CHIEF college and law school at night, and ul- mandant of the Command and General JUSTICE BURGER timately rose to become Chief Justice Staff College at Fort Leavenworth, KS. ∑ Mr. MOYNIHAN. Mr. President, yes- of the United States. In addition, he served as the command- terday’s newspapers reported that Chief Justice Burger was a distin- ing general of the 1st Infantry Divi- former Chief Justice Warren E. Burger guished jurist and a patriot in the fin- sion, ‘‘The Big Red One,’’ at Fort Riley, died on Sunday here in Washington. He est sense of the word. He was also a KS. Since June 1991, General Sullivan was 87 years old. wonderful husband and father and, al- has served in his present assignment as Twenty-six years ago, President though it is not much in fashion to say the U.S. Army Chief of Staff. Nixon nominated Warren Burger to be so today, he was a gentleman. He was Mr. President, I ask my colleagues to Chief Justice with the hope of revers- my friend for more than a quarter cen- join me in thanking General Sullivan ing the activism of the Warren Court. tury, and he will be greatly missed. for his honorable service to the people Yet history was not entirely coopera- Mr. President, I ask that the obitu- and Army of the United States. We tive: Chief Justice Burger presided over ary by Linda Greenhouse from the New wish him and his family Godspeed and a 17-year period in which many of the York Times of June 26th be printed in all the best in the future.∑ era’s most profound controversies had the RECORD. f to be decided by the High Court. A The obituary follows: number of those issues, including [From the New York Times, June 26, 1995] TRIBUTE TO THE NEW JERSEY school busing to achieve desegregation: WARREN E. BURGER IS DEAD AT 87; WAS CHIEF DEVILS Swann versus Charlotte-Mecklenburg JUSTICE FOR 17 YEARS ∑ Mr. BRADLEY. Mr. President, I rise Board of Education, 1971; the separa- (By Linda Greenhouse) today with great pleasure to congratu- tion of church and state as applicable Washington, June 25—Warren E. Burger, late New Jersey’s very own Devils. As to government aid to parochial schools, who retired in 1986 after 17 years as the 15th you may know, the New Jersey Devils Lemon versus Kurtzman, 1971; and Ex- Chief Justice of the United States, died here have defeated the Detroit Red Wings to ecutive privilege, United States versus today at age 87. The cause was congestive become the Stanley Cup Champions of Nixon, 1974, were decided in opinions heart failure, a spokeswoman for the Su- the National Hockey League. This past written by Chief Justice Burger him- preme Court said. Saturday night at the Meadowlands self. An energetic court administrator, Chief The Chief was somehow able to take Justice Burger was in some respects a transi- Arena in East Rutherford, NJ, the Dev- tional figure despite his long tenure. He pre- ils concluded their courageous quest all of this and more in stride. He rel- sided over a Court that, while it grew stead- for the Stanley Cup with a 5 to 2 vic- ished his additional statutory duties as ily more conservative with subsequent ap- tory to sweep the four-game series. chancellor of the Board of Regents of pointments, nonetheless remained strongly The New Jersey Devils may not have the Smithsonian Institution, and as influenced by the legacy of his liberal prede- superstar players like Detroit. How- chairman of the board of trustees of cessor, Chief Justice Earl Warren. The con- ever, it is clear that through their clas- the National Gallery of Art. Although stitutional right to abortion and the validity sic gritty team play and a foundation my service as a regent of the Smithso- of busing as a remedy for school segregation of discipline, unity, and hard work, nian Institution began just after Chief were both established during Chief Justice Burger’s tenure, and with his support. they overcame all adversity to achieve Justice Burger’s tenure as chancellor The country knew Chief Justice Burger as their ultimate goal. After last year’s ended in 1986, I did have the exhilarat- a symbol before it knew much about him as heart-breaking exit from the playoffs ing honor, in September of 1985, to be a man or a judge. at the hands of the New York Rangers, presented the Joseph Henry Award by He was President Richard M. Nixon’s first this year’s team forged through the then-Chancellor Burger on one memo- Supreme Court nominee, and Mr. Nixon had playoffs with a vengeance to complete rable evening at the Hirshhorn Mu- campaigned on a pledge to find ‘‘strict con- their mission. seum and Sculpture Garden. structionists’’ and ‘‘practitioners of judicial New Jersey’s key players came Following his retirement from the restraint’’ who would turn back the activist through in the playoffs to inspire their Court in 1986, Chief Justice Burger de- tide that the Court had built under Chief Justice Warren, its leader since 1953. team with clutch performances. Al- voted himself on a full-time basis to The nomination on May 21, 1969, imme- though it was forward Claude Lemieux his work as Chairman of the Commis- diately made Mr. Burger, a white-haired, 61- who took the Conn Smythe Trophy as sion on the Bicentennial of the U.S. year-old Federal appeals court judge, light- the Most Valuable Player throughout Constitution, to which President ening rod for those who welcomed as well as S 9190 CONGRESSIONAL RECORD — SENATE June 27, 1995 those who feared the end of an era of judicial organizations was to improve the education sharpest criticism for those who looked to activism. and training of participants in nearly all them to resolve social and political problems It was a central contradiction of Mr. Burg- phases of the judicial process, whether that, in his view, were not the province of er’s tenure as Chief Justice that long after judges, court clerks or prison guards. judges. ‘‘If we get the notion that courts can he became one of the most visible and, in The Chief Justice turned the small Federal cure all injustices, we’re barking up the many ways, innovative Chief Justices in his- Judicial Center, for which he served by stat- wrong tree,’’ he liked to say. tory he remained, for many people, the sym- ute as chairman of the board, into a major A speech he gave while he was still a judge bol of retrenchment that Mr. Nixon had pre- center for research and publishing about the on the Court of Appeals for the District of sented to the public on nominating him. courts. Columbia provided a useful summary of the In fact, the Supreme Court in the Burger He believed that judges could be helped to view he held throughout his career: ‘‘That years was in its way as activist as the Court be more efficient if professional management courts encounter some problems for which that preceded it, creating new constitutional techniques were imported to the courts, from they can supply no solution is not invariably doctrine in areas like the right to privacy, clerks’ offices to judges’ chambers. The In- an occasion for regret or concern. This is an due process and sexual equality that the stitute for Court Management set up a six- essential limitation in a system of divided Warren Court had only hinted at. month program for training court managers power.’’ ‘‘All in all,’’ one Supreme Court scholar, A. and administrators. Some of the more important decisions E. Dick Howard, wrote in the Wilson Quar- The Supreme Court itself became one of while he was Chief Justice were those that terly in 1981, ‘‘the Court is today more of a the first fully computerized courts in the limited litigants’ access to Federal court by center for the resolution of social issues than country; in 1981, the Justices all received using the doctrines of standing, mootness it has ever been before.’’ computer terminals on which to compose and deference to state courts. While there were some substantial changes their opinions. He seemed to regard suits for small mone- of emphasis, the Burger Court—a label lib- The Chief Justice campaigned tirelessly tary stakes as a waste of judges’ time, and erals tended to apply like an epithet—over- for better pay for judges, better education many of his speeches complained about the ruled no major decisions from the Warren for lawyers and help for the Court’s disproportionate cost to the system of trying era. evergrowing caseload. From his earliest the lawsuits brought by prisoners or consum- It was a further incongruity that despite years in office, he warned that the Federal ers over modest losses of money or property. Chief Justice Burger’s high visibility and the courts and the Supreme Court in particular His questioning of one lawyer, who argued evident relish with which he used his office were becoming dangerously overworked. in 1982 on behalf of 168,000 consumers, each to expound his views on everything from In 1983, he asked Congress to create an ap- with a claim for $7.98 against the Gillette legal education to prison management, pellate panel that could relieve some of the Company, was the talk of the Court for scholars and Supreme Court commentators Supreme Court’s caseload by resolving con- weeks, ‘‘What is the economic justification continued to question the degree to which he flicting opinions among the Federal appeals for this kind of lawsuit in the Federal courts actually led the institution over which he so courts. under any circumstances?’’ the Chief Justice energetically presided. MANY ADMIRERS, BUT DETRACTORS AS WELL demanded. His important opinions for the Court in- Judges and others interested in these long- ‘‘We are in state court, judge, in this cluded the decision that validated busing as ignored administrative issues responded with case,’’ the lawyer, Robert S. Atkins, replied. a tool for school desegregation, the one that gratitude. One of the Chief Justice’s warmest ‘‘In state or Federal court?’’ the Chief Jus- struck down the ‘‘legislative veto’’ used by admirers on the Federal bench was Frank M. tice persisted. Congress for 50 years to block executive Johnson Jr., a Federal appeals court judge ‘‘The problem,’’ Mr. Atkins said, ‘‘is that if branch actions, and the one that spurred from Alabama who won praise from civil you cheat people a little bit but do it a lot, President Nixon’s resignation in 1974 by forc- rights advocates for his orders on prison is- you can go free——’’ ing him to turn over White House tape re- sues and other rulings. The Chief Justice interrupted to interro- cordings for use in the Watergate investiga- ‘‘Warren Burger has redefined the nature gate him about the proportion of the recov- tions. Yet Chief Justice Burger was just as of his office,’’ Judge Johnson wrote in the ery that would go for legal fees. often in dissent on major decisions. In that, early 1980’s. ‘‘He has concentrated his energy INVITING ATTENTION, SOME OF THE TIME he differed from Chief Justice Warren, who not simply on exploring the subtleties of Chief Justice Burger’s effort to police the voted with the majority in nearly all impor- constitutional doctrine but on reforming the moral character of lawyers who sought to be- tant cases. mechanics of American justice. More than come eligible to argue before the Court ran- Those seeking to identify the sources of in- any of his 14 predecessors, he has invested kled some of the other Justices and in 1982 tellectual leadership on the Court usually the prestige of the Chief Justiceship in ef- provided a rare public glimpse of internal pointed to William H. Rehnquist, another forts to make the American judicial system disagreements over the Chief Justice’s ad- Nixon appointee to whom Chief Justice function more efficiently. He has used his po- ministrative approach. Burger assigned many important opinions, sition not as an excuse to withdraw from He singled out several applicants by name and to William J. Brennan Jr., the Court’s public affairs but as an opportunity to fur- and accused them of seeking membership in most senior and, with Thurgood Marshall, nish public leadership.’’ the Supreme Court bar to ‘‘launder’’ tar- most liberal member. But the priority that Chief Justice Burger nished credentials. But he failed to persuade As the senior Associate Justice, Justice assigned to administration also had its de- a majority of the Court to block the admis- Brennan had the right to assign the opinion tractors, who complained that he trivialized sions and provoked one Justice, John Paul in any case in which he was in the majority his office by emphasizing the mechanics of Stevens, to write that the Court should and the Chief Justice was in dissent, and he justice at the expense of its substance. grant applicants with questionable creden- often exercised that prerogative by assigning Occasionally, too, his enthusiastic lobby- tials a ‘‘fair hearing’’ before publicly label- major opinions to himself, particularly in ing was seen as overbearing by those at ing them as unworthy. the area of individual rights. whom it was directed. In 1978, for example, There were contradictory strains in Chief As the years passed, Chief Justice Burger he became deeply involved in the effort in Justice Burger’s attitude toward the public, seemed to assign himself the opinions in rel- Congress to overhaul the bankruptcy sys- including the press. At times he seemed to atively straightforward and uncontroversial tem. welcome and even invite public attention. He cases, avoiding those in which the Court was One Democratic Senator, Dennis DeCon- took pride in having made the Supreme deeply split and in which it would have re- cini of Arizona, whose subcommittee had ju- Court a more attractive place for tourists to quired considerable effort to marshal or hold risdiction over the bill, complained publicly visit, transforming the cold marble ground a fragile majority. As a result, his personal that a ‘‘very, very irate and rude’’ Chief Jus- floor into an area for historical exhibits. imprint on the Court’s jurisprudence was not tice had telephoned him to object to a legis- Yet he alone of all the Justice refused, always readily identifiable. lative development and ‘‘not only lobbied when announcing one of his opinion from the AN INNOVATOR IN ADMINISTRATION but pressured and attempted to be intimidat- bench, to provide tourists and lawyers in the But his imprint was distinct in the area to ing.’’ audience with a brief oral description of the which he gave his most sustained attention, The Chief Justice could also be rather in- case and the decision. judicial administration. timidating from the bench, particularly The other Justices either read aloud from Mr. Burger liked to say that he took his when a relatively inexperienced lawyer was a memorandum explaining the case or gave a title seriously. He was Chief Justice of the arguing a position with which Mr. Burger more casual oral account. When the Chief United States, not just of the Supreme disagreed. While Chief Justice Warren’s fa- Justice’s turn came, he would simply an- Court, and he took as his mandate the stew- vorite question from the bench was, ‘‘Yes, nounce that in a case with a particular ardship of the entire judicial system, state but was it fair?’’ Chief Justice Burger often name, the judgement of the lower court was as well as Federal. asked: ‘‘Yes, but why is this case in the affirmed, or reversed. When asked why he re- An array of institutions were created courts? Isn’t this a matter for the Legisla- fused to join the others in explaining his under his aegis, including the National Cen- ture to address?’’ opinions, he once said, ‘‘It’s a waste of ter for State Courts, the Institute for Court WORKING TO LIMIT THE JUDICIARY’S SCOPE time.’’ Management and the National Institute of Chief Justice Burger believed in a limited He was adamant about preserving the se- Corrections. The common purpose of those role for the courts and reserved some of his crecy of the Court’s internal operations, June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9191 even to the extent of refusing to make public ‘‘First,’’ he wrote, ‘‘the statute must have he was known as a conservative, law-and- the names of his four law clerks. A law firm a secular legislative purpose; second, its order judge. He enhanced that reputation recruiter or other member of the public who principal or primary effect must be one that with speeches and articles. A speech in 1967 called the Court’s public information office neither advances nor inhibits religion; fi- at Ripon College in Wisconsin came to Rich- seeking a list of the current law clerks would nally, the statute must not foster an exces- ard Nixon’s attention after it was reprinted receive the names of all the clerks except sive government entanglement with reli- in U.S. News & World Report. the Chief Justice’s. gion.’’ This ‘‘three-part test,’’ as it came to The White House distributed copies of the He mailed copies of his speeches to hun- be known through later refinements and speech at the time of Judge Burger’s nomi- dreds of journalists around the country and elaborations, defined the Court’s approach to nation, and the Supreme Court press office would telephone particular columnists to the establishment clause in a variety of con- handed it out for years when asked for infor- make sure his message was clear. texts. mation about his views. In the speech, he DEFINING THE LIMITS OF SPEECH AND PRESS The 1983 decision that struck down the leg- compared the American system of justice Occasionally, usually in connection with islative veto, Immigration Service v. with the systems of Norway, Sweden, Den- his annual ‘‘State of the Judiciary’’ address Chadna, altered the balance of power be- mark and the Netherlands. to the American Bar Association, a tradition tween the executive and legislative ‘‘I assume that no one will take issue with that he inaugurated, he would invite journal- branches. me when I say that these North European ists for informal ‘‘deep background’’ brief- It invalidated a procedure, which Congress countries are as enlightened as the United ings, sessions that were often relaxed and in- had incorporated into some 200 laws, permit- States in the value they place on the individ- formative. ting one or both Houses to block executive ual and on human dignity,’’ he said. But he seemed to hold much of the press branch action. The procedure, Chief Justice Yet, he continued, those countries ‘‘do not corps in low repute. Asked by a lawyer at a Burger wrote, was not within Congress’ con- consider it necessary to use a device like our Smithsonian Institution symposium what he stitutional authority because it did not fol- Fifth Amendment, under which an accused thought of the reporters who covered the low the rules the Constitution set out for person may not be required to testify.’’ Court, he replied, as he often did: ‘‘I admire ‘‘legislation’’: passage by both Houses and ‘‘They go swiftly, efficiently and directly those who do a good job, and I have sym- presentment to the President for his signa- to the question of whether the accused is pathy for the rest, who are in the majority.’’ ture. guilty,’’ he added. His special scorn was reserved for tele- The Chadna opinion in many ways summa- ‘‘No nation on earth,’’ he said, ‘‘goes to vision, which he regarded as an intrusive an- rized the Chief Justice’s view of American such lengths or takes such pains to provide noyance. He once knocked a television cam- Government. He wrote, ‘‘With all the obvious safeguards as we do, once an accused person era out of the hand of a network cameraman flaws of delay, untidiness and potential for is called before the bar of justice and until who followed him into an elevator. He vowed abuse, we have not yet found a better way to his case is completed.’’ that he would never allow oral arguments at preserve freedom than by making the exer- A MODEST START IN MINNESOTA the Supreme Court to be televised. cise of power subject to the carefully crafted Yet he wrote the opinion for the Court in restraints spelled out in the Constitution.’’ Chief Justice Burger’s speechmaking style the 1981 case Chandler v. Florida, holding Chief Justice Burger wrote relatively few changed little in subsequent years. He often that a state could permit a criminal trial to of the Court’s criminal law decisions, and returned to the theme and imagery of the be televised, even over the defendant’s objec- some of the more important decisions on the Ripon speech and often used the Scandina- tion, without depriving the defendant of the rights of criminal suspects found him in bit- vian countries, which he visited frequently, constitutional right to a fair trial. ter dissent. as benchmarks against which to compare the Chief Justice Burger wrote several of the For example, in the 1977 case Brewer v. American system. Court’s most important opinions interpret- Williams the Court ruled, in a 5-to-4 opinion Warren Earl Burger was born Sept. 17, 1907, ing the free speech and free press guarantees by Justice Potter Stewart, that the police in St. Paul. His parents, of Swiss-German de- of the First Amendment. had violated a murder suspect’s constitu- scent, were Charles Joseph Burger and the His opinion in a 1976 case, Nebraska Press tional right to counsel. The police officers, former Katharine Schnittger. His paternal v. Stuart, effectively prohibited judges from knowing that the suspect was deeply reli- grandfather, Joseph Burger, emigrated from ordering the press not to publish information gious, delivered what came to be called the Switzerland and joined the Union Army at in its possession about the crime, a confes- Christian burial speech, musing aloud on the the start of the Civil War, when he was 14. He sion or the like. The opinion said that judges wish of the victim’s parents to give their was severely wounded in combat and re- could take less drastic steps to protect daughter a Christian burial. The suspect, ceived both a battlefield commission and the criminal defendants from negative pretrial who had previously said he would talk only Medal of Honor. publicity, like sequestering the jury or after seeing a lawyer, then led the officers to Warren Burger was one of seven children. changing the site of the trial. the victim’s body. The family lived on a 20-acre truck farm on A 1973 opinion by the Chief Justice ended The majority’s decision overturning the the outskirts of St. Paul. In addition to roughly 15 years of turmoil over the legal murder conviction was ‘‘bizarre,’’ the Chief farming, his father sold weighing scales; the definition of obscenity by changing the focus Justice wrote in a dissent that was a sting- family’s financial circumstances were mod- to local communities, rather than the entire ing attack on the so-called exclusionary rule est. country. barring the use at trial of illegally seized At John A. Johnson High School, from That opinion, in Miller v. California, said evidence. which Warren Burger graduated in 1925, he obscene materials were ‘‘works which, taken ‘‘The result reached by the Court in this edited the school newspaper, was president of as a whole, appeal to the prurient interest in case ought to be intolerable in any society the student council and earned letters in sex, which portray sexual conduct in a pa- which purports to call itself an organized so- hockey, football, track and swimming. He tently offensive way and which, taken as a ciety,’’ he said. ‘‘Failure to have counsel in earned extra money by selling articles on whole, do not have serious literary, artistic, a pretrial setting should not lead to the high school sports and other news to the St. political or scientific value.’’ The Chief Jus- ‘knee-jerk’ suppression of relevant and reli- Paul newspapers. tice added that it was up to local juries ap- able evidence.’’ The rest of his formal education took place plying ‘‘contemporary community stand- A CONSERVATIVE ON CRIME ISSUES in night school while he worked days selling ards’’ to decide whether a particular work fit Although Chief Justice Burger’s views on insurance for the Mutual Life Insurance that definition. Company of New York. He attended the ‘‘It is neither realistic nor constitutionally criminal law did not always garner a major- ity on the Supreme Court, those views had night school division of the University of sound to read the First Amendment as re- Minnesota for two years, then began night quiring that the people of Maine or Mis- probably been more responsible for his being nominated to the High Court than any other law classes at the St. Paul College of Law, sissippi accept public depiction of conduct now known as the William Mitchell College found tolerable in Las Vegas or New York factor. He dissented from the Court’s 1972 decision of Law. He received his degree with high City,’’ he wrote. ‘‘People in different states that invalidated all death penalty laws then honors in 1931. vary in their tastes and attitudes, and this in force. After the Court permitted execu- He joined the faculty of the law school and diversity is not to be strangled by the abso- tions to resume four years later, the Chief taught for 12 years while practicing law with lutism of imposed uniformity.’’ Justice grew increasingly impatient with the the firm of Boyesen, Otis & Faricy. He re- RELIGION, RIGHTS AND VETO POWER legal obstacles that lawyers and judges con- mained with the firm, one of the oldest in Chief Justice Burger was also one of the tinued to place in the way of executions. the state, for 22 years; after he became a Court’s most prolific writers on another as- When the Court refused to block the execu- partner, the firm was known as Faricy, Burg- pect of the First Amendment, the clause pro- tion of a murderer whose appeals had lasted er, Moore & Costello. He handled probate, hibiting an establishment of an official na- 10 years, Chief Justice Burger wrote a con- trial and appellate cases, arguing more than tional religion. In a 1971 opinion, Lemon v. curring opinion excoriating lawyers for con- a dozen before the United States Supreme Kurtzman, he set forth the test for deciding demned inmates. He said the lawyers sought Court and many more in the Minnesota Su- whether a given law or government program to turn the administration of justice into a preme Court. that conferred some benefit on religion none- ‘‘sporting contest.’’ He married Elvera Stromberg in 1933. They theless passed muster under the First In 13 years on the United States Court of had a son, Wade Allen, and a daughter, Mar- Amendment. Appeals for the District of Columbia Circuit, garet Elizabeth. S 9192 CONGRESSIONAL RECORD — SENATE June 27, 1995 As a young lawyer, Mr. Burger became ac- trolled by Louis E. Wolfson, a friend and ing students participated in the pro- tive in community affairs. He was president former client who was under Federal inves- gram: Raymond Albin, Julie Asmar, of the Junior Chamber of Commerce and the tigation for violating securities laws. Marla Burton, Kevin Byrne, William On May 21, a week after the Fortas res- first president of the St. Paul Council on Dicks, Nicholas Doukas, Neil Gregie, Human Relations. That group, which he ignation, President Nixon nominated Warren helped to organize, sponsored training pro- Burger to be Chief Justice. The nomination Conrad Jakubow, Brian Kilmer, Kristin grams for the police to improve relations went smoothly in the Senate, and he was Klaczek, Joe Liss, Robert McVey, Dan- with minority groups. For many years, he sworn in as Chief Justice on June 23, 1969. iel Maigler, Agnes Milewski, Manoj was a member of the Governor’s Interracial The Chief Justice and his wife lived in a Mishra, Vicky Pappas, Devanshu Patel, Commission. renovated pre-Civil War farmhouse on sev- Anne Marie Pontarelli, Caroline He also became involved in state politics, eral acres in McLean, Va. According to the Prucnal, Todd Pytel, Seema Sabnani, working on Harold E. Stassen’s successful annual financial disclosure statements re- Jennifer Sass, Scott Schwemin, Peter campaign for governor. He went to the 1948 quired of all Federal judges, he had assets of Republican National Convention to help more than $1 million. His largest investment Sedivy, Richard Stasica, Angela Wal- Governor Stassen’s unsuccessful bid for the was the common stock of the Minnesota lace, Andrea Wells, and Stephen Zibrat. Presidential nomination. Mining and Manufacturing Company. This fine group of students has dem- MAKING THE MOVE TO WASHINGTON He was a gardener and a serious wine en- onstrated a remarkable understanding thusiast who took pride in his wine cellar In 1952, he was at the Republican conven- of the fundamental element of the and occasionally sponsored wine-tasting din- tion again, still a Stassen supporter. But he American system of government.∑ ners at the Supreme Court. helped Dwight D. Eisenhower’s forces win a By statute, the Chief Justice is Chancellor f crucial credentials fight against Senator of the Smithsonian Institution and chairman Robert A. Taft of Ohio. On the final day, VACLAV HAVEL of the board of trustees of the National Gal- with General Eisenhower lacking nine votes lery of Art, duties that, as an art and history ∑ Mr. KERRY. Mr. President, earlier for the nomination, Mr. Burger helped swing buff, he enjoyed. He visited antiques stores the Minnesota delegation and gave Eisen- this month, Vaclav Havel, President of to look for good pieces for the Court and hower the votes that put him over the top. the Czech Republic, spoke at a lunch- took an active role in the Supreme Court Cheers broke out on the convention floor as eon in his honor at the John F. Ken- Historical Society. nedy Library in Boston. President an organ played the University of Minnesota He and his wife led an active social life in fight song. Washington and spent part of nearly every Havel spoke eloquently about Presi- His reward was a job in Washington, as As- summer in Europe, usually in connection dent Kennedy’s New Frontier and the sistant Attorney General in charge of the with a conference or other official appear- hopes it inspired in his own country Civil Division of the Justice Department. He ance. and among peoples throughout the supervised all the Federal Government’s Chief Justice Burger cut an imposing fig- world. He quoted the famous words of civil and international litigation. He told a ure, and it was often said that he looked like young Justice Department lawyer years President Kennedy’s Inaugural Ad- Hollywood’s image of a Chief Justice. He was dress, ‘‘Ask not what your country can later that he would have been content to nearly 6 feet tall, stocky but not heavy, with continue running the Civil Division for the regular features, a square jaw and silvery do for you, ask what you can do for rest of his career. hair. your country.’’ He spoke as well of our One of his assignments was somewhat un- Proper appearance was important to him. failure to live up to those ideals, and of usual for the Civil Division chief. He agreed He once sent a note to the Solicitor Gen- the importance of continuing to strive to argue a case in the Supreme Court, usu- eral’s Office complaining that a Deputy So- ally the task of the Solicitor General’s Of- for them. ‘‘What we can never relin- licitor General had worn a vest the wrong fice. The case involved a Yale University quish is hope,’’ he said. shade of gray with the formal morning attire professor of medicine, John F. Peters, who Present in the audience at the Ken- required of Government lawyers who argue had been discharged on loyalty grounds from nedy Library to hear these inspiring before the Court. his job as a part-time Federal health con- In 1976, he appeared at a Bicentennial com- words were many members of the Ma- sultant. memoration in a billowing robe with scarlet saryk club in Boston, a nonprofit cul- The Solicitor General, Somin E. Soboloff, trim, a reproduction of the robe worn by the tural and social organization for Amer- disagreed with the Government’s position first Chief Justice, John Jay. He later put icans of Czech or Slovak ethnic back- that the action by the Civil Service Commis- the robe on display in the Court’s exhibit sion’s Loyalty Review Board was valid and ground. President Havel’s own personal area. refused to sign the brief or argue the case. courage in leading his country to free- A book by Chief Justice Burger, ‘‘It Is So dom and democracy after the fall of the Mr. Burger argued on behalf of the board and Ordered’’ (William Morrow), was published lost. Among the lawyers who filed briefs on earlier this year. It is an account of 14 cases Berlin Wall made his visit to Boston an the professor’s behalf were two who would that, in his judgment, helped shaped the especially moving occasion for them. precede Mr. Burger on the Supreme Court, Constitution. I believe President Havel’s eloquent Abe Fortas and Arthur J. Goldberg. Mr. Burger’s wife died in May 1994. He is address will be of interest to all my After two years, Mr. Burger resigned from survived by his son, of Arlington, Va.; his colleagues in the Senate. I ask that it the Justice Department and was preparing to daughter, of Washington, and two grand- return to private practice in St. Paul when be printed in the RECORD, along with children. Funeral arrangements were incom- Senator KENNEDY’S introduction of Judge Harold Stephens of the United States plete today.∑ Court of Appeals for the District of Columbia President Havel. f Circuit died. President Eisenhower nomi- REMARKS OF SENATOR EDWARD M. KENNEDY nated him for the vacancy, and he joined the CONGRATULATING THE STUDENTS I want to thank Paul Kirk for that gener- court in 1956. OF MAINE SOUTH HIGH SCHOOL ous introduction. Everyone in the Kennedy His elevation to the Supreme Court 13 family and everyone associated with Presi- years later was made possible by President ∑ Mr. SIMON. Mr. President, I wish to dent Kennedy’s Library is proud of Paul and Lyndon B. Johnson’s failure to persuade the recognize a group of students from his outstanding leadership as Chairman of Senate to accept Abe Fortas as Chief Jus- Maine South High School in Park the Library Foundation. tice. Ridge, Illinois, who won the Unit 1 I also want to thank John Cullinane for his A BENEFICIARY OF ’68 ELECTION award for their expertise in the ‘‘His- effective role in our Distinguished Foreign On June 13, 1968, Earl Warren had an- tory of Rights,’’ in the national finals Visitors Program. John has been a dear nounced his intention to resign after 15 years of the ‘‘We the People . . . The Citizen friend to our family for many years, and we as Chief Justice. President Johnson nomi- are grateful for all he’s done for Jack’s Li- nated Mr. Fortas, then an Associate Justice, and the Constitution’’ program. brary. as Chief Justice. But the nomination became As the ranking member of the Senate Today is a special day for the Library, and a victim of the 1968 Presidential election Subcommittee on the Constitution, we are delighted that our guest of honor campaign and was withdrawn on Oct. 2, the Federalism, and Property Rights, I could be here. fourth day of a Senate filibuster that fol- have a keen interest in constitutional The ties that bind the United States and lowed acrimonious confirmation hearings. issues. It is exciting to recognize the Czech people go back many years. We’re Chief Justice Warren agreed to delay his achievement in an area which is impor- proud to have with us today members of Bos- retirement, and it was clear that whoever tant both to me personally and to the ton’s Masaryk Club, named for the great won the Presidential election would choose founder of modern Czechoslovakia. the next Chief Justice. Justice Fortas re- entire Nation. In 1918, at the end of World War I and the mained on the Court until May 1969, when he Pat Feicher taught the winning class collapse of the Austro-Hungarian Empire, resigned after the disclosure that he had ac- which competed against 49 other class- the new independent nation of Czecho- cepted a $20,000 fee from a foundation con- es from across the Nation. The follow- slovakia was born. Thomas Masaryk drafted June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9193 its Declaration of Independence, and he used Square to challenge that government and foundly influenced a whole generation in America’s Declaration of Independence as there was real dangers of violence. President various parts of the world, a period whose his model. He adopted the red, white and Havel showed great leadership in bringing aftereffects we are still feeling today. I am blue colors of our flag for the Czech flag and about a peaceful transition. It was called the speaking, of course, about the sixties. I will he declared the birth of the new nation. At Velvet Resolution, and in December he be- never forget my sense of elation at the elec- the time, he was in Pittsburgh, Pennsylva- came the first president of the new, free tion of President Kennedy. I will never for- nia, seeking support for his native land, a Czechoslovakia. get my sense of shock at the news of his as- true patriot for his people. In 1993, when Czechoslovakia peacefully sassination. It was then that I realized that Masaryk’s Declaration of Independence split into two independent nations, he be- there are dark forces operating in the human had a fascinating subsequent history. Masa- came the first President of the new Czech nature and in the world at large. And I will ryk died in 1937, and left the document to his Republic. never forget the few weeks I spent in the private secretary, who gave it to the Library During President Havel’s earlier visit, we United States at the end of the sixties, my of Congress for safe keeping, until it could happened to be together at a large dinner own taste of the unrepeatable atmosphere of one day be returned to a free Czechoslovakia party in his honor. As it was ending, I men- the times in this country. When I first met President Havel in 1990, tioned that one of the most beautiful and The historical dimensions of a decade do the Berlin Wall had been down for several moving places to visit in Washington was the not always coincide with its chronological months, and I mentioned to him that it Lincoln Memorial at night. He was in- dimensions. The sixties began right on time might be time to return the document to trigued, and so we drove over there together. in 1960, on a wave of hope with the election Czechoslovakia. But Czechoslovakia’s de- I read out loud the beautiful words inscribed of your brother John Fitzgerald Kennedy as mocracy was still very new, and it’s future on the walls—the text of Lincoln’s Gettys- the 35th President of the United States. The was uncertain. So President Havel thought is burg Address and his Second Inaugural Ad- same sixties, however, ended prematurely in best for the document to remain at the Li- dress—and his interpreter translated them the chaos and disillusion of 1968, with the brary of Congress a little longer. In 1991, for President Havel. student riots in Paris, the assassination of with democracy firmly established, it was a It was a deeply moving few moments. He your brother Robert Kennedy in Los Ange- great honor and privilege for all of us in Con- wrote down several of the great phrases, and les, the demonstrations against the war in gress to return that historic document to he turned to me and said, ‘‘I am not able to Vietnam in Washington, and with the inva- President Havel and the people of Czecho- understand the language, but I can under- sion of Czechoslovakia by the Warsaw Pact. slovakia. stand the poetry.’’ What remained of the sixties chronologically As all of us know, our guest of honor has Finally, I want to quote briefly from some after that, did not really belong there. Even had an extraordinary and very inspiring ca- of President Havel’s own words, describing the last joyful moment of the decade, the reer. As a student in the 1950’s in Prague, he his life. Here is what he said: ‘‘You do not be- landing of Man on the Moon ‘‘before the dec- was attracted to the theater. After complet- come a ‘dissent’ just because you decide one ade was out,’’ seemed to be a mere legacy of ing his compulsory military service, he day to take up this most unusual career. You the late President who had turned the eyes started work for an avant-garde theater are thrown into it by your personal sense of of the nation toward the New Frontier but company as a stagehand and electrician. responsibility, combined with a complex set was murdered before he could witness the With his talent for writing and his strong of external circumstances. You are cast out breakthrough. sense of the stage, he quickly rose to the po- of the existing structures and placed in a po- Few decades in the history of mankind sition of manuscript reader, and then resi- sition of conflict with them. It begins as an have been the focus of so much energy, joy dent playwright. attempt to do your work well, and ends with and hope as well as of so much pain, bitter- His rise coincided with the increasing po- being branded an enemy of society.’’ ness and disappointment. It is then no won- litical thaw in his country in the 1960’s, and But that label could not stick. No friend of der that few decades have left behind a leg- he became well-known for his vivid plays freedom can be an enemy of society. Presi- acy so controversial. It is hard to imagine a about the dehumanizing and repressive bu- dent Havel’s heroic opposition to repression more suitable place for a small reflection on reaucracy of communist regimes. won him many admirers throughout the this legacy and what it might mean today President Havel’s relationship with the world, including the great Irish playwright, than the Kennedy library. Kennedy family goes back to 1968, when he Samuel Beckett. In 1982, in a unique political From the very beginning of the sixties we visited the United States in connection with action, Beckett dedicated a play to Havel, hear the great call of the dead President for the first American production of one of his about the suffering of a martyr in an oppres- a new step forward, for courage and personal most famous plays. Due to restrictions on sive country. responsibility: ‘‘Ask not what your country visitors from Iron Curtain countries at the I know that President Havel regards that can do for you—ask what you can do for your time, his visa limited him to New York City. as one of the finest tributes he has ever re- country.’’ In the course of the sixties the His friends in the literary and theater com- ceived, and he eminently deserved it. civil rights movement triumphed and elimi- munity contacted Senator Robert Kennedy, Through many years of hardship and repres- nated much of the heavy burden of the past. and, with Bobby’s help, President Havel was sion, he kept the idea of freedom alive, and The turmoil of the sixties destroyed the bar- given permission to visit Washington. he successfully led his people to it. riers between the sexes and opened a new But the thaw in Czechoslovakia was only As Robert Kennedy said, ‘‘Each time a man realm of freedom—sexual freedom. The cre- temporary, and the Soviet invasion of 1968 stands up for an ideal, or acts to improve the ative impulse of the sixties produced an un- ended the famous Prague Spring. President lot of others, or strikes out against injustice, precedented number of original works in lit- Havel’s works were banned and his passport he sends forth a tiny ripple of hope, and erature, music and arts. The technological was confiscated. crossing each other from a million different progress, accelerated by the effort to con- Repression and harassment followed. In centers of energy and daring, those ripples quer the space, set off an information revolu- 1975, after his production of ‘‘The Beggar’s build a current that can sweep down the tion whose fruit we are in full extent reaping Opera,’’ even the members of his theater au- mightiest walls of oppression and resist- only today. In the communist part of the diences became targets of police harassment. ance.’’ world the end of the decade witnessed an But President Havel never wavered. He did Those words eloquently describe the ex- outburst of popular will against the absurd- not remain silent or flee the country during traordinary life of our guest of honor and the ity of the totalitarian dictatorship in the repressive Communist rule. He was ripples of hope he has set forth across the Czechoslovakia. forced to take menial jobs, but he continued world. He is a symbol of the aspirations of If it all stayed at that, we would now be re- writing, speaking out for human rights, and peoples everywhere for liberty and an end to membering the sixties as a golden age of standing up against the Communist dictator- oppression. mankind. However, the hope that had ush- ship. I am honored to introduce him now, a man ered it in remained largely unfulfilled. The In 1977, he became a leader of Charter 77, a for all seasons, an inspiring leader for our removal of barriers did not automatically manifesto signed by hundreds of artists and times, President Havel of the Czech Repub- bring about universal prosperity or universal intellectuals protesting the government’s re- lic. harmony. A large part of the creative im- fusal to abide by the Helsinki Agreement on pulse of the times dissipated in disillusion or Civil and Political Rights. For his continu- REMARKS OF VACLAV HAVEL succumbed to commercial interests. The ing courage, he was jailed several different Dear Mr. Senator, dear guests, the name of newfound individual freedom spent itself in times, and spent five years in prison. the President for whom this library is hedonism, arbitrariness and in drugs. Tech- In his visit to this country in 1990, Presi- named, your name, Mr. Senator, and the nological progress also helped to build a new dent Havel told me that during those dark name of your family, evokes as powerful an generation of ever more destructive weapons years in prison, the most important and echo as few other names do. For several gen- which were prevented from being used only most sustaining book he had read was ‘‘Pro- erations, this name has been inseparably by the certainty of mutually assured de- files in Courage’’ by President Kennedy. linked with the history of Boston, the Com- struction. And the Czechoslovak rebellion After the fall of the Berlin Wall, President monwealth of Massachusetts, the United against totalitarianism collapsed, in part be- Havel became the leader of the Civic Forum, States of America and, indeed, of the whole cause of the ambivalence of its efforts, under an organization of groups opposed to the world. the avalanche of half a million troops of oc- Communist Government. In November 1989, For me and many others, this name is pri- cupation while the rest of the world could massive crowds gathered in Wenceslas marily linked with a period which had pro- only stand by and watch. S 9194 CONGRESSIONAL RECORD — SENATE June 27, 1995 It would be too simple to attribute the fail- THE NEED FOR REFORM rule will affect their job or business. ure of our hopes at the time only to unfavor- Government has to treat people like You simply cannot expect a hard-work- able circumstances, to assassins or to the adults. It has to understand that most ing gas station owner or restaurant military might of the totalitarian regime. It people are good people. They don’t need manager to subscribe to the Federal would be equally simple to say that our to fill out a lot of forms to do the right hopes had been false from the very begin- Register and track all the changes and ning, that they were nothing more than a re- thing. revisions in the OSHA code. sult of the euphoria of youth or inexperience. As the debate unfolds, we will hear And while they are at it, agencies Our hopes did not come true because, as theories about so-called super man- should explain their rules in plain Eng- many times before in history, we failed to dates. About judicial review. About es- lish. For example, look at a sentence heed that call for personal responsibility and oteric provisions of the Administrative from an EPA rule in the December 29, for a service to common interests. The op- Procedures Act. About how many per- 1994, Federal Register. It means to say portunity to work together for the common missible statutory constructions can treated hazardous wastes are exempt good gradually degenerated into a service to dance on the head of a pin. from disposal regulations under two group interests, sectarian interests and ulti- But when most Montanans think mately purely individual interests. The lov- conditions. But what it actually says is ing sixties were followed by the selfish about Government regulations, they this: eighties. are more straightforward. Montanans Currently, hazardous wastes that are used I do not think we should tear our garments want common sense. Montanans be- in a manner constituting disposal (applied to here as if this were some exceptional and un- lieve most Federal rules and regula- or placed on land), including waste-derived forgivable failure. The service to one’s own tions cost too much. They accomplish products that are produced in whole or in interests, the tendency to use one’s own po- too little. They make responsible busi- part from hazardous wastes and used in a tential for one’s own good is an inseparable ness owners fill out too many forms. manner constituting disposal, are not sub- part of human nature and the motivation And they just plain make people angry. ject to hazardous waste disposal regulations which ultimately drives the world forward. provided the products produced meet two OSHA LOGGING REGULATIONS At the same time it is equally an inseparable conditions. I will give you an example. Earlier part of human nature to love and be loved, to Imagine handing that in to a high be capable of solidarity, altruism, even of this year, OSHA, the Occupational self-sacrifice. Some scientists like E. O. Wil- Safety and Health Administration, pro- school English teacher. son and some theologians think of both these posed a rule that would make loggers Second, we should use new statistical tendencies as being a part of a single elemen- wear steel-toed boots. tools like risk assessment and cost- tary life force. The question of a talmudistic Seems to make sense—unless you are benefit analysis when appropriate. scholar: ‘‘If I am not for myself, who will be actually out in the Montana woods in They can help agencies set priorities, for me? And if I am only for myself, who am so we spend our money wisely and I?’’ still demands an answer. winter, on a steep slope and frozen ground. In that case, steel-toed boots solve the biggest problems first. And Today we are all thirty years older and they can help make sure agencies hopefully—though this is far from certain— can make the job more dangerous, not wiser. Much of that crazy decade we remem- less. They make your feet go numb, so think creatively and consider all the ber with a smile and sometimes even with it is harder to hold your grip. And if options before charging ahead. But we some embarrassment. Much of that decade you are holding a live chainsaw at the must also understand their limita- we can relinquish as unrepeatable, mistaken time, you are in a lot of trouble. tions—because I do not believe we can or misconceived. What we can never relin- So the people this regulation was place a dollar value on things like the quish is hope.∑ meant to help knew it made no sense survival of the bald eagle or brain dam- f at all. And to add injury to insult, it age in children from lead in drinking water. REGULATORY REFORM threatened their jobs. OSHA told them to buy the boots in 2 weeks or take a Third, Congress should conduct more ∑ Mr. BAUCUS. Mr. President, in the furlough. oversight. Passing a law is only a small next few days, the Senate will begin to Another example was the EPA’s deci- part of the job. It is implementation of debate regulatory reform legislation to sion 2 years ago to ban some kinds of the law that affects real people at make regulations more sensible, less bear sprays—pepper sprays that help home and in business. But too often, burdensome, and more efficient. people avoid injury from bear attacks— Congress passes a law and then walks This debate is long overdue. Because because they might irritate the nasal away, leaving implementation entirely while passing laws is important, real tissues of an attacking grizzly. Yet an- to bureaucrats who do not always have people are affected not by congres- other was the Forest Service’s decision practical experience. The OSHA log- sional debates but by implementation to bar loud speech and inappropriate ging regulation is a good example. Con- of the law by agencies. noises in national forests. gress should review major new regula- And all too often, agencies imple- Most regulations are not as ridicu- tions closely, so the mistakes are cor- ment laws with too much paperwork, lous or offensive as these. But even so, rected before they start to threaten too much harassment and too little the sheer volume of regulation is a big jobs and businesses. common sense. It is time to set things problem. Small business owners often Fourth, we should strengthen the straight, and I congratulate the leader- give up all of Friday afternoon to fill Regulatory Flexibility Act. This law ship for bringing this issue to the floor. out OSHA forms and IRS withholding requires agencies to pay special atten- At the same time, however, we must documents just to comply with exist- tion to the effects of their regulations remember that preventing pollution, ing regulations, let alone keep up with on small business. A good goal—but ensuring food safety and keeping our all the new ones. one agencies sometimes ignore. rivers clean are critically important to Today, we are only half-way through Today, small businesses have no a good life for Americans. 1995. And the Federal Register, in right to challenge an agency, in court, Unfortunately, some special interest which the government publishes its when it fails to comply with the Act. groups do not see it that way. All over rules and regulations, is about to hit By establishing a streamlined process Washington, they are trying to get the 33,000-page mark. That is about 200 for judicial review, we can help small loopholes and special relief that will pages of rules, regulations, comments, businesses protect themselves. let them get away with polluting the revisions, and rerevisions every day. And fifth, we must continue strong air and water. And they are calling KEY ELEMENTS OF REFORM and effective protection of public their loopholes regulatory reform. So I congratulate the leadership for health, public safety and our natural They should not get away with it. moving ahead with regulatory reform. heritage. Clean air, clean water and So let us watch what is coming The effort is only beginning, but at the clean neighborhoods are basic Amer- aboard pretty carefully. Let us reform end I believe a good bill will include ican values. They are essential to a Government rules and regulations to five key elements. high quality of life in our country. make them work better. But let us not First, we should open up the regu- Regulatory reform should get them for use regulatory reform to weaken pro- latory process. It should be easier for us more efficiently. It must not run tection of public health and safety and people to comment on proposed rules. away from these goals, and allow more to lower the quality of life. They should get more notice when a contamination of rivers and streams, June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9195 more urban smog, or greater threats to Mr. LAUTENBERG. Mr. President, I The PRESIDING OFFICER. Without the public health and safety. stand here proud of the New Jersey objection, it is so ordered. CONCLUSION Devils’ accomplishment in winning f With these five steps, Mr. President, hockey’s most treasured prize, the we will make federal rules and regula- Stanley Cup. I congratulate the players PROGRAM tions more effective. And we will do and their coaches for an inspiring se- Mr. BENNETT. For the information something even more important. Amer- ries with four straight victories over of all Senators, the Senate will resume icans will be more confident that their the Detroit Red Wings. consideration of the securities bill to- tax dollars are being spent wisely, and This capped an impressive string of morrow at 8:40 a.m. All Senators that we are guaranteeing public health playoff victories over Boston, Pitts- should be aware there will be a rollcall and safety with the absolute minimum burgh, and Philadelphia—victories that vote beginning at 8:45 a.m. on or in re- of bureaucracy and paperwork. resulted in the Devils bringing the lation to the Specter amendment. Fol- So I look forward to the debate on Stanley Cup to my home State for the lowing that vote, there will be a series this bill, and to working with my col- first time in history. It is the first time of votes with a brief period of debate leagues to meet these goals.∑ in history that a national professional between each vote. The first vote will f championship was won by a team with be 15 minutes in length, and the re- ‘‘New Jersey’’ in its name. maining votes in the series will be only CONGRATULATING THE NEW JER- Mr. President, it took a great deal of 10 minutes in length. Following the se- SEY DEVILS FOR WINNING 1995 determination, courage, drive, and dis- ries of votes and 30 minutes of debate, NHL STANLEY CUP cipline—and no small amount of prayer there will be a 15-minute vote on final Mr. SARBANES. Mr. President, I ask on the part of fervent fans—for the passage of the securities litigation. unanimous consent that the Senate Devils to bring this cup home. f proceed to the immediate consider- And they did this despite the fact ation of Senate Resolution 142, a reso- that no one thought they could win it. ORDER TO RECESS lution to congratulate the New Jersey Not when the playoffs started. Not Mr. BENNETT. Mr. President, if Devils for winning the 1995 NHL Stan- when they reached the finals. No one there is no further business to come be- ley Cup, a resolution submitted earlier gave them a chance against the Red fore the Senate, I now ask unanimous today by Senators LAUTENBERG and Wings. consent that at the conclusion of Sen- BRADLEY; that the resolution and pre- But, under the guidance of Head ator PELL’s morning business speech, amble be agreed to, en bloc, and the Coach Jacques Lemaire and with the the Senate stand in recess under the motion to reconsider be laid upon the great help of Claude Lemieux, the previous order. table, and that any statements appear Cup’s Most Valuable Player, and Mar- The PRESIDING OFFICER. Without in the RECORD as if read. tin Brodeur, the Devils demonstrated objection, it is so ordered. The PRESIDING OFFICER. Without everything great about New The Senator from Rhode Island is objection, it is so ordered. Jerseyans—we have the heart, the So the resolution (S. Res. 142) was drive, and the stamina to do it when we recognized. agreed to. have to. f The preamble was agreed to. I will take a moment to mention U.S. RATIFICATION OF THE LAW The resolution, with its preamble, is other outstanding Devils players—Ken OF THE SEA CONVENTION WILL as follows: Daneyko, Bruce Driver, and John ENHANCE OUR NATIONAL SECU- S. RES. 142 MacLean who have each been with the RITY INTERESTS Whereas on October 5, 1982, the New Jersey Devils since 1983 and have helped start Devils played their first National Hockey the team’s long journey to the top. Mr. PELL. Mr. President, in the past League game in New Jersey, embarking on a Also we must commend Jim Dowd, a few months, I have taken the floor on quest for the Stanley Cup which was satis- New Jersey native hailing from the several occasions to highlight how the fied 13 years later; U.N. Convention on the Law of the Sea Whereas the Devils epitomize New Jersey town of Brick, who scored the winning pride with their heart, stamina, and drive goal in game two. would protect the national interests of and thus have become a part of New Jersey Mr. President, anyone who has been the United States with regard to our culture; in New Jersey knows that the Devils— fisheries and our economic activities. Whereas the New Jersey Devils won 10 like our shoreline—are an integral part Today, I wish to address how U.S. rati- games on the road during the Stanley Cup of our culture. And I, along with 8 mil- fication of the convention will enhance playoffs, thus demolishing the previous lion other New Jerseyans look forward our most important interest: national record; security. Whereas the Devils have implemented an to seeing them defend their cup title in ingenious system known as the ‘‘trap’’ that the Byrne Arena next year and the The convention establishes as a mat- was designed by head coach Jacques Lemaire year after as well. ter of international law freedom of which constantly stifled and frustrated their Once again, I would like to congratu- navigation rights that are critical to opponents; late them on their remarkable accom- our military forces. This was high- Whereas Conn Smythe trophy winner plishment, and to thank them for the lighted by the President in his Message Claude Lemieux led the league with 13 play- hard fight they fought to bring the to Congress, transmitting the Conven- off goals, three of which were game-winners, Stanley Cup to the great State of New tion on the Law of the Sea: and goalie Martin Brodeur led the league with a 1.67 goals-against average during the Jersey. The United States has basic and enduring playoffs; f national interests in the oceans and has con- Whereas the New Jersey hockey fans are sistently taken the view that the full range the best fans in the nation and deserve com- ORDERS FOR WEDNESDAY, JUNE of these interests is best protected through a mendation for helping build the team into 28, 1995 widely accepted international framework championship caliber and for supporting the Mr. BENNETT. Mr. President, I ask governing uses of the sea. .. . Each succeed- ing U.S. Administration has recognized this Devils during their drive for the Stanley unanimous consent that when the Sen- Cup; as the cornerstone of U.S. ocean policy. . . . Whereas the New Jersey Devils during the ate completes its business today, it The Convention advances the interests of the playoffs beat Boston, Pittsburgh, Philadel- stand in recess until the hour of 8:40 United States as a global maritime power. It phia and in the finals swept the heavily fa- a.m. on Wednesday, June 28, 1995; that preserves the right of the U.S. military to vored Detroit Red Wings in four games giv- following the prayer, the Journal of use the world’s oceans to meet national secu- ing the state of New Jersey its first-ever the proceedings be deemed approved to rity requirements and of commercial vessels championship for a major league team offi- date, the time for the two leaders be to carry sea-going cargoes. .. . Early adher- cially bearing the state’s name: Now, there- reserved for their use later in the day, ence by the United States to the Convention fore, be it and the Agreement is important to maintain Resolved, That the Senate congratulates and the Senate then immediately re- a stable legal regime for all uses of the sea, the New Jersey Devils for their outstanding sume consideration of S. 240, the secu- which covers more than 70 percent of the discipline, determination, emotion, and inge- rities litigation bill, under the provi- surface of the globe. Maintenance of such nuity, in winning the 1995 NHL Stanley Cup. sions of the previous agreement. stability is vital to U.S. national security S 9196 CONGRESSIONAL RECORD — SENATE June 27, 1995 and economic strength.’’ (Treaty Doc. 103–39, nately, some of these instances involve the Aegean Sea. Turkey has warned p.iii–iv) islands located in international straits against the transformation of this area Secretary of Defense William Perry or along routes used for international into a ‘‘Greek Lake’’ and many have and Secretary of State Warren Chris- navigation and overflight of the high- warned of the possibility of conflict topher emphasized in a joint letter to est strategic importance. Here again, over this issue. The Law of the Sea spe- the Congress last year that: the convention strikes the perfect bal- cifically calls for peaceful resolution of As one of the world’s major maritime ance by guaranteeing to all ships and such disputes and, when the Hamburg powers, the United States has a mani- aircraft, including warships, sub- Tribunal on the Law of the Sea is con- fest national security interest in the marines, and military aircraft a right vened, it could be seized to address dis- ability to navigate and overfly the of passage on, over and under inter- putes such as this one. oceans freely. national straits and archipelagic sea Another potential point of conflict is A recent Department of Defense Re- lanes. to be found in the South China Sea, port on National Security and the Con- The need to protect freedom of navi- where conflicting claims have been vention on the Law of the Sea con- gation is not merely a theoretical staked over the Spratly Islands. These cluded that the United States issue. There have been recent situa- islands have been claimed by the Peo- ... national security interests in having a tions where even U.S. allies denied our ple’s Republic of China, Taiwan, Viet- stable oceans regime are, if anything, even Armed Forces transit rights in times of nam, the Philippines, Malaysia, and more important today than in 1982 when the need. Such an instance was the 1973 Brunei. Recently, some of those claim- world had a roughly bipolar political dimen- Yom Kippur war when our ability to ants have engaged in aggressive activi- sion and the U.S. had more abundant forces resupply Israel was critically depend- ties. The location of the Spratlys is of to project power to wherever it was needed.’’ ent on transit rights through the paramount importance, as the islands (Hearing before the Committee on Foreign Relations on the Current Status of the Con- Strait of Gibraltar. Again, in 1986, lie along strategic sea lanes that con- vention on the Law of the Sea, S. Hrg. 103– United States aircraft passed through nect the Indian Ocean and the Persian 737, pp.61–75) the Strait to strike Libyan targets in Gulf to the Pacific Ocean. Seventy per- In his letter to the Senate accom- response to that government’s acts of cent of Japan’s oil imports travel panying that report Secretary Perry terrorism directed against the United through this route and both the United declared that: States, after some of our allies had de- States and its allies would stand to nied us the right to transit through lose if armed conflict erupted as a re- ... the Convention establishes a universal regime for governance of the oceans which is their airspace. sult of these conflicting claims. The needed to safeguard United States security In April 1992, Peruvian fighters administration recently advised the and economic interests, as well as to defuse strafed a United States C–130 aircraft various claimants that the United those situations in which competing uses of that was 60 nautical miles off the Peru- States would view with serious concern the oceans are likely to result in con- vian coast, well within Peru’s claimed any maritime claim or restriction on flict. .. . Historically, this nation’s security 200-nautical-mile territorial sea, but maritime activity in the South China has depended upon the ability to conduct well outside the 12-nautical-mile limit Sea that was not consistent with the military operations over, under and on the recognized by the Law of the Sea Con- Law of the Sea Convention. oceans. . .. To send a strong signal that the United States is committed to an ocean reg- vention and the United States. This in- In that regard, on June 20, 1995, the ulatory regime that is guided by the rule of cident resulted in the death of one U.S. Committee on Foreign Relations re- law, General Shalikashvili and I urge your service member and the wounding of ported, and on June 22 the Senate support in securing early advice and consent several others, as well as the loss of the agreed to, Senate Resolution 97, intro- of the United Nations Convention on the aircraft. Peru continues to challenge duced by Senator THOMAS and Senator Law of the Sea and implementing Agree- United States aircraft flying over its ROBB, which I cosponsored. This resolu- ment. claimed territorial sea. tion calls on the parties involved in I ask unanimous consent that Sec- There are a number of other situa- this dispute to solve their differences retary Perry’s letter be printed in the tions where having the Law of the Sea in a manner that is consistent with RECORD at the conclusion of my re- in effect might have made a difference. international law. marks. I ask unanimous consent that a sum- I would like to bring to the attention The PRESIDING OFFICER. Without mary of such instances be printed in of my colleagues an op ed piece that objection, it is so ordered. (See exhibit the RECORD at the conclusion of my re- was published on May 26, 1995 in the 1.) marks. Washington Times and I ask unani- Mr. PELL. With the end of the cold The PRESIDING OFFICER. Without mous consent that it be printed in the war, both our vital interests and our objection, it is so ordered. (See exhibit RECORD at the conclusion of my re- ability to defend them have shifted. In 2.) marks. these fiscally difficult times, the con- Mr. PELL. Another way in which the The PRESIDING OFFICER. Without vention allows us to concentrate our convention protects our national secu- objection, it is so ordered. resources on the most strategic points rity interests is by bringing an incred- (See exhibit 3.) of our national security. Illustrations ible amount of stability and certainty Mr. PELL. In it, Keith Eirinberg, a of this phenomenon can be found in the with regard to multiple and sometimes Fellow in the Asian Studies Program provisions of the Law of the Sea Con- divergent ocean uses. Most impor- at the Center for Strategic and Inter- vention that provide for innocent pas- tantly the convention provides the national Studies, calls the Law of the sage, transit passage, and archipelagic most effective brake on excessive Sea Convention perhaps the world’s passage. coastal state maritime claims in ocean greatest diplomatic achievement for The convention allows a coastal areas adjacent to their coasts. having established internationally ac- State to claim a territorial sea that If the United States is not a party to cepted laws for three fourths of the shall not exceed 12 nautical miles the convention, preserving our naviga- earth’s surface. He also clearly dem- measured from the baseline. While this tional rights in nonwartime situations onstrates that excessive claims have no provision recognizes the special rights becomes increasingly costly. The Law standing under the Convention and of the coastal state in the area imme- of the Sea provides very clear rules and that the U.S. ability to influence a diately adjacent to its coastline, it also circumstances according to which peaceful settlement of the dispute over provides specifically for the right of in- these claims need to be recognized. In the Spratly Islands would be enhanced nocent passage for ships, including addition, if the rights of a transiting by U.S. ratification of the treaty. warships and submarines, to transit nation are impeded, the Law of the Sea In addition, on June 22, 1995, Rear through the territorial sea. provides all parties with a very clear Adm. Lloyd R. Vasey (Ret.), a senior Likewise, in some areas, archipelagic set of rules for the peaceful settlement strategist specializing in Asia-Pacific states have been allowed to enclose wa- of disputes. security, wrote in the Christian ters located between the various is- Only a few weeks ago, a potential Science Monitor that the claims over lands of an archipelago, and to claim conflict threatened to erupt over Greek the Spratly Islands should be resolved them as national waters. Unfortu- territorial claims around its islands in through international law and the UN June 27, 1995 CONGRESSIONAL RECORD — SENATE S 9197 Convention on the Law of the Sea. He come a party to the United Nations Conven- Since 1986, Peru has repeatedly challenged added that for its own credibility the tion on the Law of the Sea because of its U.S. aircraft flying over its claimed 200 nau- U.S. needs to complete ratification of concerns about the deep seabed mining pro- tical mile territorial sea. During several of the Law of the Sea Treaty. I ask unani- visions, contained in Part XI of the Conven- these challenges, the Peruvian aircraft oper- tion. The Convention is due to enter into ated in a manner that unnecessarily and in- mous consent that this article be print- force on November 16, 1994, now that the req- tentionally endangered the safety of the ed in the RECORD at the end of my re- uisite number of other states (60) have rati- transiting U.S. aircraft and its crew. This in- marks. fied it. However, consultations were recently cludes an incident where a U.S. C–130 was The PRESIDING OFFICER. Without concluded which resulted in an Agreement to fired upon and a U.S. service member was objection, it is so ordered. correct what the United States has long killed. (See exhibit 4.) viewed as the Convention’s flawed deep sea- In 1986, two Cuban MIG–21 aircraft inter- Mr. PELL. There are scores of other bed mining provisions. The United States cepted a USCG HU–25A Falcon flying outside instances where maritime boundary now intends to sign the Agreement at the of its 12 nautical mile territorial sea, claim- disputes were solved in a peaceful man- United Nations on July 29, 1994. Accordingly, ing it had entered Cuban Flight Information ner, precisely because the Law of the the Convention as modified will be transmit- Region (FIR) without permission. ted to the Senate for its advice and consent Sea establishes such clear rules and In 1988, Soviet warships intentionally at the end of the 103rd Congress. ‘‘bumped’’ two U.S. warships engaged in limitations. If it does not ratify the The Department of Defense fully supports innoncent passage south of Sevastopol in the Convention, the United States will U.S. signature of the Agreement, and ratifi- Black Sea. stand at risk of being left out of the en- cation of the Convention as modified by the In 1984, Mexican Navy vessels approached forcement of this Constitution for the Agreement. In the Administration’s view, U.S. Coast Guard vessels operating outside Oceans, and will be subject to the un- the new Agreement satisfactorily resolves Mexican territorial waters and interfered certainties of customary international the issues that the U.S. Government and with valid USCG law enforcement activities. ocean mining interests raised in the early Libyan claims to the Gulf of Sidra have re- law. 1980’s during deliberations over whether the I have heard arguments that the Con- sulted in repeated challenges and hostile ac- United States should sign the Law of the Sea tion against U.S. forces operating in high vention’s provisions on freedom of Convention. The new Agreement meets these seas. navigation are not really important be- objections by correcting the serious institu- During the 1980’s, transits of the Northwest cause they reflect customary inter- tional and free market deficiencies in the Passage by the USCG POLAR SEA and national law. I disagree with that argu- original Convention. We have received indi- POLAR STAR were challenged by the Cana- ment. cations from other industrialized nations dian Government. Customary international law is in- that, with adoption of the new Agreement, herently unstable. Governments can be they will soon accede to the modified Con- EXHIBIT 3 vention. [From the Washington Times, May 26, 1995] less scrupulous about flouting the The Convention establishes a universal re- precedents of customary law than they gime for governance of the oceans which is U.N. MARITIME PACT COULD PRODUCE SOUTH would be if such actions were seen as a needed to safeguard U.S. security and eco- CHINA SEA SOLUTION violation of their treaty obligations. nomic interests, as well as to defuse those (By Keith W. Eirinberg) Moreover, not all governments and situations in which competing uses of the The recent Clinton administration state- scholars agree that all of the critical oceans are likely to result in conflict. In ad- ment on the Spratly Islands dispute, urging navigation rights protected by the Con- dition to strongly supporting our interests in negotiations instead of force, is the strong- vention are also protected by cus- freedom of navigation, the Convention pro- est declaration yet of U.S. interests in the tomary law. They regard many of those vides an effective framework for serious ef- South China Sea. forts to address land and sea-based sources of rights as contractual and, as such, While critics of the administration argue pollution and overfishing. Moreover, the that the United States should ‘‘draw a line in available only to parties to the Con- Agreement provides us with an opportunity the sand’’ against Chinese aggression in the vention. to participate with other industrialized na- Spratlys, U.S. interests are better served by The concordant judgment of those tions in a widely accepted international efforts to persuade the contesting parties to charged with responsibility for the na- order to regulate and safeguard the many di- follow international law, including the newly tional security of our Nation is re- verse activities, interests, and resources in effective 1982 U.N. Convention on the Law of flected in the report of the Department the world’s oceans. Historically, this na- the Sea, and find a diplomatic solution. of Defense on National Security and tion’s security has depended upon the ability The Republican-controlled Senate can help the Law of the Sea, which states: to conduct military operations over, under, America’s efforts to protect these interests and on the oceans. The best guarantee that by ratifying the Law of the Sea accord, giv- Our principal judgement is that public this free and unfettered access to the high ing this country greater standing as it en- order of the oceans is best established by a seas will continue in the years ahead is for courages a peaceful resolution of the dispute. universally accepted Law of the Sea treaty the U.S. to become a party to the Conven- The Spratly Islands imbroglio is essen- that is in the U.S. national interest. . . . Re- tion, as modified by the Agreement, at the tially a maritime controversy centered on liance upon customary international law in earliest possible time. the question of sovereignty and jurisdiction the absence of the modified Convention In the coming months, we anticipate over geologic features and adjacent waters in would represent a necessarily imprecise ap- heightened public debate of the merits of the the South China Sea. proach to the problem as well as one which Law of the Sea Convention. To put that de- Six nations claim part or all of the requires the United States to put forces in bate into perspective, you will find enclosed Spratlys: the People’s Republic of China, harm’s way when principles of law are not a paper which briefly outlines the history of Taiwan, Vietnam, the Philippines, Malaysia universally understood or accepted. A uni- the original Convention, the steps leading to and Brunei. The dispute has direct implica- versal Convention is the best guarantee of the formalization of the Part XI Agreement, tions for U.S. interests: freedom of naviga- avoiding situations in which U.S. forces and the nation’s vital national security and tion and overflight and the maintenance of must be used to assert navigational free- other interests in becoming bound by the peace and stability in Southeast Asia. doms, as well as the best method of fostering modified Convention. The sovereignty issue appears intractable, the growth and use of various conflict avoid- To send a strong signal that the United so many of the parties have voiced a desire ance schemes which are contained in the States is committed to an ocean regulatory to shelve this point and look to joint devel- Convention. regime that is guided by the rule of law, opment of the area’s resources. China, in a Mr. President, this is not merely my General Shalikashvili and I urge your sup- ‘‘divide and conquer’’ strategy, insists on ne- opinion but that of the professionals port in securing early advice and consent of gotiating bilaterally and rejects a regional whose job it is to protect our Nation’s the United Nations Convention on the Law or international approach. The Association security. We must not ignore their ad- of the Sea and implementing Agreement. of Southeast Asian Nations, which includes vice: United States ratification of the Sincerely, some of the claimants, is interested in a re- WILLIAM J. PERRY. gional solution. Law of the Sea Convention will en- The parties to the dispute, except Brunei, hance our national security interests. EXHIBIT 2 claim ownership over islands, reefs, atolls, EXHIBIT 1 PARTICULAR CASES WHERE HAVING THE LAW rocks and cays in the Spratlys. The Spratlys THE SECRETARY OF DEFENSE, OF THE SEA CONVENTION IN EFFECT MIGHT are important because they lie along strate- Washington, DC, July 29, 1994. HAVE MADE A DIFFERENCE: gic sea lanes and lines of communication Hon. CLAIBORNE PELL, Between 1961 and 1970, Peru seized 74 U.S. that connect the Indian and Pacific oceans. Chairman, Committee on Foreign Relations, fishing vessels over disputed tuna fisheries. More than 70 percent of Japan’s oil imports U.S. Senate, Washington, DC. In 1986, Ecuador interfered with a USAF and a large volume of global commerce trav- DEAR MR. CHAIRMAN: In 1982, the United aircraft flight over the high seas 175 miles el along this maritime route. The Spratlys States made a decision that it would not be- from the Ecuadorian coast. are domestically important to the claimants S 9198 CONGRESSIONAL RECORD — SENATE June 27, 1995 because of the politics and patriotism re- leaders find a way to defuse tensions over Such colliding claims ought to alert Wash- flected in ownership. territorial disputes in the South China Sea. ington to pay much closer attention to this It is the potential of vast hydrocarbon re- With several countries on a collision course, high-stakes strategic game. The implica- sources beneath the seabed that has caused a major regional crisis is waiting to happen. tions for American interests are disturbing: this dispute to become a flash point in East At issue are claims of sovereignty over the future access to resources, freedom of the Asia. The energy needs of the developing Spratly and Paracel Islands—hundreds of is- seas, the balance of power, and regional sta- claimants have made the exploitation of oil lets and reefs and surrounding seas believed bility are all involved. and gas beneath the South China Sea espe- to be rich in oil, gas, and other resources. cially attractive. China, which urgently needs new energy The US should now revamp its policy of re- The U.N. Convention on the Law of the sources, is the central disputant; others in- lying on ASEAN even when important Amer- Sea—perhaps the world’s greatest diplomatic clude Vietnam, Brunei, Malaysia, the Phil- ican interests are involved. Instead, the US achievement for having established inter- ippines, and Taiwan. China’s claims are his- should volunteer to act as honest broker to nationally accepted laws for three-fourths of torically based, going back several centuries work out production-sharing agreements for the earth’s surface—can provide the frame- when the South China Sea was an area of joint development of resources in contested work for a diplomatic solution. For example, preeminent Chinese influence and power. areas, and request disputants to put sov- it prescribes the methods for determining Currently they have no basis in inter- ereignty claims on hold. These claims should boundaries. Of the claimants, the Philippines national law, and claims of some of the other be resolved through international law and and Vietnam have ratified the convention. countries are also questionable. To Beijing, however, ownership is nine- the UN Convention on the Law of the Sea. The prevailing view in Asia is that China is tenths of the law. While advocating a diplo- For its own credibility the US needs to com- matic solution, it has aggressively placed en- deliberately expanding its geopolitical influ- plete ratification of the Law of the Sea Trea- campments and markers in contested areas ence in the region. This perception was dra- ty, now in the Senate. Leadership won’t cost of the Spratlys. This ‘‘talk and take’’ pat- matically reinforced in 1992 when the Chi- Washington an extra dime, nor will it re- tern was most recently illustrated in China’s nese People’s Congress declared ownership of quire any troops. Crisis prevention is what occupation of Mischief Reef in Philippine- the waters around the Spratlys and Paracels it’s all about. claimed territory. and readiness to use military power to de- China’s cavalier attitude to international fend its interests. The claim would make the f law is also shown by its 1992 territorial sea South China Sea a virtual Chinese lake law. This declares Chinese jurisdiction over straddling shipping lanes carrying huge vol- RECESS UNTIL 8:40 A.M. umes of global trade, including the oil life- virtually all of the South China Sea—a claim TOMORROW that has no basis in modern international lines of Japan and South Korea. law. Indonesia and other countries of the Asso- The PRESIDING OFFICER. Under China must play by the rules. Washington ciation of Southeast Asian Nations (ASEAN) encourages Beijing to join the international have convened unofficial forums seeking to the previous order, the Senate stands community in many different areas, from resolve the disputes, but progress on the is- in recess until 8:40 tomorrow morning. nuclear proliferation to human rights. But sues has stalled. There being no objection, the Senate, Washington finds itself in a poor position to Regional tensions escalated last month at 9:38 p.m., recessed until Wednesday, persuade Beijing to ratify the Law of the Sea when Philippine president Fidel Ramos chal- accord without having done so itself. lenged China’s ‘‘illegal’’ occupation of a June 28, 1995, at 8:40 a.m. U.S. administrations had resisted ratifica- small atoll in the Spratlys aptly named Mis- f tion because of inequities in the deep-seabed- chief Reef. mining provisions. But changes to the con- It lies well within the Philippine’s 200 mile vention have addressed U.S. objections. Exclusive Economic Zone but also within the NOMINATIONS Last year, with strong Defense Department area claimed by Beijing. backing, the White House signed the amend- China hasn’t hesitated to use force in as- Executive nominations received by ed Convention on the Law of the Sea and serting territorial claims. In 1974 it seized the Senate June 27, 1995: sent it to the Senate for ratification. most of the Paracel islands east of Vietnam. JUDICIARY America’s ability to influence a peaceful In 1988, the two engaged in bloody clashes settlement of the Spratly Islands dispute over the Spratlys. TODD J. CAMPBELL, OF TENNESSEE, TO BE U.S. DIS- would be enhanced by U.S. ratification of the TRICT JUDGE FOR THE MIDDLE DISTRICT OF TEN- Indonesians are deeply suspicious of Chi- treaty. In light of the tensions in the South NESSEE, VICE THOMAS A. WISEMAN, JR., RETIRED. na’s revision of a map that now depicts part China Sea, this step should be taken soon. JAMES M. MOODY, OF ARKANSAS, TO BE U.S. DISTRICT of the maritime area around Natuna island, JUDGE FOR THE EASTERN DISTRICT OF ARKANSAS, VICE hundreds of miles south of the Spratlys, to HENRY WOODS, RETIRED. EXHIBIT 4 be under Chinese jurisdiction. Indonesia’s EVAN J. WALLACH, OF NEVADA, TO BE A JUDGE OF THE [From The Christian Science Monitor, June U.S. COURT OF INTERNATIONAL TRADE, VICE EDWARD D. military leaders have announced that they 22, 1995] RE, RETIRED. will defend their national interests by force COLLISION IN THE CHINA SEA—WORLD OIL AND if necessary. What makes the issue particu- U.S. INFORMATION AGENCY SHIPPING LANES AT STAKE IN MULTINATION larly irksome to Indonesia is that a $35 bil- ALBERTO J. MORA, OF FLORIDA, TO BE A MEMBER OF DISPUTE lion deal involving a United States oil com- THE BROADCASTING BOARD OF GOVERNORS FOR A TERM (By Lloyd R. Vasey) pany was signed last year to help develop the OF 2 YEARS. (NEW POSITION.) East Asia’s economic momentum may Natuna gas field, possibly one of the world’s grind to a premature halt unless political largest. June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1329 EXTENSIONS OF REMARKS

THE UNITED NATIONS AT 50: BAD been press-ganged, and 70 ‘‘begging for some This program is a highly important tool for de- IN BOSNIA; TIME TO GROW UP sort of protection’’ were turned away by veloping our industrial technological base for UNHCR on Thursday alone. the future. Lab Tech Transfer programs Also last week was Le Monde’s report that around the country provide industry with ac- HON. GEORGE P. RADANOVICH for a year the United Nations has been sit- OF CALIFORNIA ting on a report written by its own people cess to the incredible R&D resources and ca- pabilities of our national laboratories. Every IN THE HOUSE OF REPRESENTATIVES that shows that the Serbs alone have pur- sued ethnic cleansing as a planned and sys- year, thousands of scientists from U.S. com- Tuesday, June 27, 1995 tematic government policy and that they panies perform experiments in collaboration Mr. RADANOVICH. Mr. Speaker, I'm going have been responsible for the vast majority with scientists at our national labs. Through to withhold wishing the United Nations a of the other war crimes and atrocities. The this program, technologies developed at our ``happy birthday'' until it grows up. My particu- report makes the explicit admission that it national labs become resources that permit is not possible to treat all of the parties in U.S. industry to introduce new state-of-the-art lar problem with this international organiza- the Bosnian conflict on an equal basis. tionÐchartered for a mighty mission and with The U.N. not only made this pretense pos- products and to enhance its competitive posi- the best of intentionsÐcomes into clear focus sible, but also dressed it up with the mantle tion in domestic and international markets. when you look at the sorry state of its per- of the world’s prominent international medi- The Lab Tech Transfer Program also funds formance in Bosnia. ating body. This farce of moral equivalence cooperative research and development agree- As so often is the case, the editors of the continues despite the existence of the U.N.’s ments, or CRADA's, with small- and medium- Wall Street Journal have offered their readers report and was most recently on display on sized companies around the country. Cur- an insightful and incisive examination of cur- Friday when the Security Council con- rently, there are CRADA's in such important demned Bosnian Muslim army efforts to fields as advanced materials, advanced com- rent conditions. That is the case with today's block the movement of Unprofor forces in its editorial, ``Virtual United Nations,'' which I am puting, biotechnology, nuclear medicine, and attempt to lift the siege of Sarajevo. others. For each of these CRADA's, industry pleased to draw to the attention of my col- To be sure, many organizations and indi- leagues in Congress. vidual states have failed Bosnia. But the more than matches the amount of funds con- [From the Wall Street Journal, June 27, 1995] U.N. is the body that purports to be com- tributed by our national labs. Mr. Speaker, I petent in such situations. Worse than inac- believe that this kind of collaborative partner- VIRTUAL UNITED NATIONS tion (which the U.N. could then blame on ship between industry and our national labora- Fifty years ago this week, representatives member-state cowardice), the U.N.’s actions tories is necessary to the economic future of of 50 countries gathered in San Francisco to have in many ways worsened the conflict. sign the Charter of the United Nations. It the country and is certainly a higher priority Those who talk of U.N. reform are there- than the administration of the sprawling De- was probably both the novelty of peace in fore the most optimistic of the pundits. Europe and the dream that it would spread Many believe the body is simply partment of Energy. and last that inspired the U.N.’s signatories unreformable because consensus of the type The second general area that I think should to pledge to ‘‘save succeeding generations that existed in 1944 and 1945 would be impos- be funded at a higher level is biological and from the scourge of war’’ by practicing ‘‘tol- sible to find today. Presumably there is a environmental research; specifically oceano- erance and [living] together in peace,’’ by role for such an organization, though per- graphic and carbon dioxide programs. These uniting ‘‘our strength to maintain inter- haps confined to a talk shop. Yet as long as programs quantify the mechanisms and proc- national peace and security’’ and by accept- the U.N. undermines its own goals, as it has esses by which carbon dioxide is assimilated, ing ‘‘principles and the institution of meth- in Bosnia by refusing to acknowledge and ods’’ so that ‘‘armed force shall not be used, transported and transformed in coastal condemn blatant aggression, any hope that oceans; study the flux of carbon dioxide be- save in the common interest.’’ it will somehow develop into a useful forum Fine as they are, it is difficult to imagine for conflict resolution are likely to be dis- tween the oceans and the atmosphere and that these words sounded any less like rules appointed. develop remote sensing equipment for meas- for a virtual reality world then than they do urement of carbon dioxide in the oceans. today. Then as now, people like to believe f Mr. Speaker, while I am not convinced of that having such intentions is important, no AMENDMENT TO THE ENERGY the theory of global warming, it does seem to matter that war is raging in Bosnia under AND WATER APPROPRIATIONS me that it is worth our while to find out its va- the U.S.’s watchful eye. lidity. This of course can only be done through This 50th anniversary year of the U.N. fea- BILL tures far more debates about how the U.N. more research and there is valuable work needs to be reformed than recounting of its HON. MICHAEL P. FORBES going on right now in the fields of oceano- successes. graphic and carbon dioxide research. Again, I But these ideas do not address the key OF NEW YORK place a higher priority on this than the bu- failings of the U.N. that are visible all IN THE HOUSE OF REPRESENTATIVES reaucracy at DOE and I urge adoption of the around us. These are not just the short- Tuesday, June 27, 1995 amendment. comings that can be attributed to the dearth f of collective interest and political will. They Mr. FORBES. Mr. Speaker, as per the re- are also uniquely U.N.-inspired instances of quest of the Rules Committee, I am submitting A TRIBUTE TO BRIG. GEN. failing to do what the organization and its an amendment to the Energy and Water De- JEFFREY R. GRIME bodies say it is dedicated to doing. velopment Appropriations bill for preprinting in The failure of the U.N. in Bosnia is too the RECORD. grand to describe exhaustively or even in Mr. Speaker, my amendment is quite sim- HON. WALTER B. JONES, JR. thematic terms, so events of last week will OF NORTH CAROLINA ple, it would simply add $100 million to the en- have to suffice. The refusal of the United Na- IN THE HOUSE OF REPRESENTATIVES ergy supply, research, and development activi- tions to authorize a NATO request for an air Tuesday, June 27, 1995 strike on a U.N.-mandated target last week ties account in the bill and offset the increase was merely the lastest in a series of such ve- with a corresponding cut in the Department of Mr. JONES. Mr. Speaker, I want to recog- toes. Energy departmental administration account. nize Brig. Gen. Jeffrey R. Grime for his dedi- A new type of failure of the U.N. was also Mr. Speaker, my amendment is intended to re- cated service to our Nation as the commander on display last week in Belgrade. There, the store funding to a couple of valuable research of the 4th Wing for the U.S. Air Force. General office of the U.N. High Commissioner for Ref- and development programs while making fur- Grime was assigned to Seymour Johnson Air ugees is complaining that it is besieged by draft-age ethnic Serb men—mainly refugees ther cuts in the DOE bureaucracy. Force Base, Goldsboro, NC in July 1993 as from Bosnia and Croatia—who are being The first program is the Energy Research commander of the 4th Wing. The 4th Wing rounded up for conscription into the rump- Laboratory Technology Transfer Program has been involved in every major air support Yugoslav army. Figures given by the office which was funded at $57 million last year and action undertaken by the United States. Gen- are that as many as 2,500 men have already unfortunately has been zeroed out in this bill. eral Grime also commands an F±15E and

∑ This ‘‘bullet’’ symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor. E 1330 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 KC±10 composite wing, a major air combat ciary committee, Barry Levey is retiring after a and began as an adjunct instructor at the command base with more than 4,600 person- distinguished career in service to the people of University of Texas, Austin. This month nel who provide logistics support for the 916th Ohio. (May, 1995) Dan was selected from among 400 I had the privilege of serving in the Ohio applicants for a teaching and painting/draw- Air Refueling Wing. ing position on the University of Texas fac- General Grime served with distinction from State Senate while Barry served in the Ohio ulty. February to August 1994 as the commander House of Representatives during the 1960's Encouragement from this type of competi- of the 4404th Composite Wing at Dhahran Air and again when he joined the State senate in tion is important, particularly in a field like Base in Saudi Arabia. He has also presided 1987. I can tell you Barry has been a strong art where so many people tell youngsters, over the addition of the national training mis- advocate and outstanding friend to southwest- ‘‘You can’t make a living in art.’’ Be assured sion for the F±15EÐgiving Seymour Johnson ern Ohio. Barry's aggressive leadership has that this program and your contribution to the world's largest compliment of this state-of- been crucial in promoting the concerns of the it was an important stepping stone in our son’s evolving career as an artist. the-art weapons system. Also under his com- citizens of this area. mand, the 4th Wing received the highest rat- Barry holds the distinction of being the only Mr. Speaker, the artistic heritage of our ing during the air combat command oper- member in Ohio history to be the chairman of country is dependent upon our young artists ational readiness inspection, thus establishing both the senate and house judiciary commit- and I would like to congratulate this year's arts a new standard of excellence for the U.S. Air tees. He is a graduate of Middletown High competition winners from the Fifth Congres- Force. School, the University of Michigan, and the sional District: First placeÐRina Wiedenhoeft, As if his operational contributions have not Ohio State University College of Law. This a student at Eleanor Roosevelt High School in been enough, General Grime distinguished former officer in the U.S. Army Judge Advo- Greenbelt, for her winning watercolor entry en- himself in reaching out to the civilian commu- cate General Corps was first elected to the titled, ``Self-portrait.'' nity of the Goldsboro area. This was shown in Ohio House of Representatives in 1962 and Second place (tie)ÐErik Minter, a student at an increase in base tours and by over 94,000 served in that body until 1970. After a suc- Thomas Stone High School in Waldorf, for his hours of volunteer work by service members cessful career in banking and business, Barry oil painting entitled, ``Mason Dixon Door,'' and in Wayne County in 1994 alone. Indeed, Gen- returned to public service in 1987 as a State Alicia Pirner of Northern High School in Cal- eral Grime has made a big difference in the senator. Throughout his distinguished tenure, vert County for her colored pencil drawing en- lives of manyÐand there are plenty of per- Barry has demonstrated his deep faith in, and titled, ``Mediterranean Villa.'' sonal testimonies supporting it. From all of us dedication to, upholding the principles of Third place (tie)ÐGreg Paterno, a student who have worked with General Grime, we join American democracy. He has been a strong at Leonardtown High School for his acrylic in bidding him a fond farewell. Thank you, Jeff advocate for education and has been recog- painting of football players in action entitled, Grime, for your friendship and extraordinary nized for his efforts on behalf of controlling ``4th and 1;'' and Khalise Holmes of Laurel contributions to Goldsboro-Wayne County, government spending. High School in Prince Georges County for a li- NC, and to our Nation. Mr. Speaker, we have often heard that noleum block print entitled, ``Still Life With f America works because of the unselfish con- Flowers.'' tributions of her citizens. I know that Ohio is I hope my colleagues will join me in saluting A TRIBUTE TO THEO JACKSON, AN a much better place to live because of the these talented individuals. These young artists EXAMPLE OF EXCELLENCE IN dedication and countless hours of effort given enrich our cultural traditions, and through this DEDICATION by Senator Barry Levey over the years. While competition we continue to encourage their Barry is leaving his official capacity as State creative energies. HON. WALTER R. TUCKER III senator, I know he will continue to be actively f OF CALIFORNIA involved in those causes dear to him. I ask my colleagues to join in paying a spe- WE THE PEOPLE * * * THE CITIZEN IN THE HOUSE OF REPRESENTATIVES cial tribute to my friend, Senator Barry Levey's AND THE CONSTITUTION Tuesday, June 27, 1995 record of personal accomplishments and wish- Mr. TUCKER. Mr. Speaker, in this world ing him, his wife Marilee, and their three chil- HON. EDWARD J. MARKEY there are those people who dedicate them- dren all the best in the years ahead. OF MASSACHUSETTS selves to the work ethic, and the needs of oth- f IN THE HOUSE OF REPRESENTATIVES ers. Tuesday, June 27, 1995 Mr. Speaker, Theo Jackson is such a per- THE 1995 CONGRESSIONAL HIGH son. SCHOOL ARTS COMPETITION Mr. MARKEY. Mr. Speaker, I rise today on Theo has dedicated himself to the needs of the occasion of the national conference in American Airlines, starting some 26 years ago. HON. STENY H. HOYER Washington of We the People * * * the Citi- Theo uprooted his family for his company, OF MARYLAND zen and the Constitution to congratulate the and came west to assume the role of general IN THE HOUSE OF REPRESENTATIVES teachers and educational administrators who manager at the Oakland Airport. Tuesday, June 27, 1995 have participated in and led this highly effec- Mr. Speaker, Theo gave of his time above tive program. and beyond the call of duty, sacrificing family Mr. HOYER. Mr. Speaker, I rise today to We the People * * * the Citizen and the time and personal wants for the benefit of his mark the opening of the 14th annual congres- Constitution is a program of the Center for company. He also dedicated himself to the sional high school arts exhibition, entitled ``An Civil Education, and is funded by the U.S. De- community, becoming involved in various ac- Artistic Discovery.'' This competition, which is partment of Education by act of Congress. tivities to make a difference and an impact. held in congressional districts throughout the The program teaches the principles of the Mr. Speaker, I rise today to pay tribute to a country, with the winning entry being displayed U.S. Constitution. It does so by engaging stu- gentleman who exemplifies the type of dedica- in the U.S. Capitol, is designed to recognize dents at the upper elementary, middle, and tion so needed in America today, Mr. Theo the creative talents of young Americans. high school levels in group research, study Jackson. This event is an inspiration to many young and debate on the central issues and ques- artists, Mr. Speaker. I recently received a let- f tions which shaped our Constitution. ter from the parents of Dan Sutherland, the Marie Gosnell is a ninth grade civics teacher HONORING SENATOR BARRY winner of the arts competition in the Fifth Con- at Medford High School. Her honors class pre- LEVEY ON THE OCCASION OF HIS gressional District of Maryland in 1984. In this sented their hearing project to parents and RETIREMENT letter, which I would like to share with my col- teachers this past May after finishing six units leagues, Ann and Doug Sutherland of Green- of the We the People * * * national curricu- HON. PAUL E. GILLMOR belt write: lum. Mrs. Gosnell finds it to be, ``among the Our son Dan was your district’s selection OF OHIO most exciting programs, involving students in 1984. This recognition from outside his deeply, preparing them for citizenship, and IN THE HOUSE OF REPRESENTATIVES realm of family, friends, and school helped giving them a rich understanding of why our Tuesday, June 27, 1995 give him the assurance to decide to pursue art as a career. He won art scholarships as an government functions as it does.'' Mr. GILLMOR. Mr. Speaker, I rise today to undergraduate at James Madison University We the People is an example of how coordi- pay tribute to an outstanding citizen of Ohio. and as a graduate student at Syracuse Uni- nation and consultation among Federal and State senator and chairman of the senate judi- versity. Dan moved to Texas with his wife, State education officials and teachers can June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1331 produce a national program which addresses pose at all. Adding insult to injury, NHTSA has A RUMMAGE SALE ON THE the fundamental issues of civics education. virtually ignored its promise to make adequate ENVIRONMENT The excitement generated by this program crash safety and damage information available should be emphasized, especially in the face to consumers. HON. GEORGE MILLER of recent attacks by some groups on the De- What has happened is that consumers are OF CALIFORNIA partment of Education and on any national spending hundreds of millions of dollars in IN THE HOUSE OF REPRESENTATIVES educational coordination or standards in the extra repair costs and higher insurance pre- Tuesday, June 27, 1995 name of local control. miums because of the extra damage incurred The program also builds links between pub- in low-speed accidents. In IIHS's latest series Mr. MILLER of California. Mr. Speaker, each lic officials, businesses, parents, educators, of 5-mile-per-hour crash tests, all but 1 of the day we seem to have a clearer view of ways and students. Former Chief Justice of the Su- 14 1995 midsize four-door models tested sus- in which the Republican Congress intends to preme Court, the late Warren Burger, called it tained damage that ranged up to $1,056 in the attempt to balance our Nation's budgetÐand ``one of the most extensive and effective pro- two crash tests this legislation would restore this week's action by the House Interior Ap- grams for the education of young Americans as a standard. That is a Federal standard that propriations Subcommittee is an alarming indi- about our constitutional system of government cars were required to withstand without any cation that it will be our Nation's most valuable and the principles and values it represents.'' I damage at all. Worse yet, the lowest total natural resources that will play a major role in and members of my staff have visited schools damage repair cost for IIHS's four crash this balancing act. to support the program's goal of directly in- testsÐall at 5 miles per hour was $1,433; and As a recent San Francisco Chronicle edi- volving legislators. 3 of the 14 cars ended up with more than torial laments the subcommittee's actions ap- Once again, I congratulate the organizers, $3,000 damage in those 4 tests at 5 miles per pears to be ``a national rummage sale, the ef- teachers and students of the We the People hour. That a consumer would be faced with fect of which will be to privatize, commer- program. this amount of damage after an accident oc- cialize, pollute, and consume America's natu- f curring at 5 miles per hour is both offensive ral heritage.'' and totally unnecessary. I believe that those of us who have worked RETURN TO STRONGER 5 MPH for years to protect our natural resources There is no doubt that consumers over- BUMPER STANDARD would agree with the Chronicle's view that whelmingly favor a stricter bumper standard, a such actions are ``a sell-out, pure and simple.'' survey conducted in 1992 by the Insurance HON. ANTHONY C. BEILENSON I commend the following editorial to my col- Research Council found that almost 70 per- OF CALIFORNIA leagues' attention: cent of respondents said cars should have IN THE HOUSE OF REPRESENTATIVES bumpers that provide protection in low speed [From the San Francisco Chronicle, June 22, 1995] Tuesday, June 27, 1995 collisions, and over 80 percent said they A RUMMAGE SALE ON THE ENVIRONMENT Mr. BEILENSON. Mr. Speaker, today I am would choose protective bumpers over stylish bumpers. Surely no one buying a new car Now we know how the Republican Congress reintroducing legislation I have proposed be- is going to balance the budget: auction off fore to restore automobile bumper protection would prefer the extra inconvenience and cost the nation’s most valuable natural re- standards to the 5-mile-per-hour requirement associated with damage sustained in low- sources, along with its own votes, to the that was in force when the Reagan administra- speed accidents with weaker bumpers to the highest bidder. tion took office in 1981. virtually negligible additional cost, if any, of Make no mistake, the legislation on off- Beginning in 1978, new cars were equipped stronger bumpers. shore oil and gas leasing and the East Mo- with bumpers capable of withstanding any Both Consumers Union, which has peti- jave National Preserve that passed the House damage in accidents occurring at 5 miles per Appropriations Subcommittee Tuesday is tioned NHTSA unsuccessfully to rescind the part and parcel of a giant national rummage hour or less. That action was taken in accord- change, and the Center for Auto Safety sale, the effect of which will be to privatize, ance with the Motor Vehicle Information and strongly support Federal legislation requiring a commercialize, pollute and consume Ameri- Cost Savings Act of 1972, which requires the return to the 5-miles-per-hour bumper stand- ca’s natural heritage. National Highway Traffic Safety Administration ard. The insurance industry also strongly be- It is a sell-out, pure and simple. [NHTSA] to set a bumper standard that lieves rolling back the bumper standard was The congressional assault on natural re- ``seek(s) to obtain the maximum feasible re- an irresponsible move, and supports a strong- sources is far from being limited to the duction of cost to the public and to the er standard as a way of controlling auto insur- coasts and the desert. The House budget plan calls for selling—or even giving away—vast consumer.'' ance costs. As part of the Reagan administration's effort tracts of national forests, and other House Mr. Speaker, the Reagan administration legislation would set up a commission to to ease what it called the regulatory burden on made a serious, costly mistake when it rolled study the closure of national parks. the automobile industry, NHTSA reduced the back the bumper standard. It has cost con- Still other proposals call for turning na- standard to 2.5 miles per hour in 1982, claim- sumers many hundreds of millions of dollars, tional wildlife areas over to the states to do ing that weaker bumpers would be lighter, and with as they please. And an amendment to with no offsetting benefit at all. Some manu- would therefore cost less to install and re- the vetoed budget rescission act, that would facturers have continued voluntarily to supply place, and would provide better fuel economy. have doubled the cutting of timber in na- the stronger bumpers. But car buyers, who This supposedly meant a consumer would tional forests while suspending all environ- cannot look at a bumper system and judge save money over the life of a car, since the mental protections, has risen from its well how it would perform, have no easy way of deserved grave and is heading back to the lower purchase and fuel costs should out- knowing whether cars have the stronger or president’s desk. weigh the occasionally higher cost of any acci- weaker bumpers. In April, President Clinton promised to dent. The administration promised at the time veto any bill that compromises America’s to provide bumper data to consumers, so that Restablishing the 5-miles-per-hour bumper clean water, clean air and toxic waste laws. car buyers could make informed choices about standard would be the most effective and If he is as good as his word, every single one the amount they wished to spend for extra easiest measure Congress could approve this of these ecological nightmares must be ve- bumper protection. year to reduce excessive automobile insur- toed if and when they reach his desk. This experiment has been a total failure. ance costs. We can save consumers hun- Let’s look at just three of them. The so-called ‘‘logging without laws’’ None of the anticipated benefits of a weaker dreds of millions of dollars by a re-instating a proven regulation that worked well in actual amendment to the rescission bill would vir- bumper standard has materialized. Crash tests tually hand national forest management conducted by the Insurance Institute for High- practice. We cannot allow rhetoric about the over to timber barons with chain saws. way Safety [IIHS] have shown year after year burden of Government regulation and the ad- Ostensibly intended to expedite salvage that bumper performance has little or nothing vantages of free market economics to blind us logging of dead and dying trees, it would di- to do with bumper weight or car price. Lighter to the reality of the unnecessary costs of rect the U.S. Forest Service and the Bureau bumpers seem to perform just as well as minor automobile accidents. It is long past of Land Management to cut more than 6.2 million board-feet over the next 18 months heavier ones in accidents, and bumpers on in- time to restore rationality to automobile bump- er protection standards. with no regard to the protections stipulated expensive autos perform just as well as or in the National Environmental Policy Act, better than the bumpers on expensive autos. Mr. Speaker, I urge my colleagues to join the National Forest Management Act, the In fact, some of the heaviest and most expen- me in supporting this proposal to restore the Clean Water Act or the Endangered Species sive bumpers serve no energy-absorbing pur- 5-mile-per-hour bumper standard. Act. E 1332 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 The bill’s definition of ‘‘salvage’’ timber 21st century. We are facing some very serious the community in which the captain lives. Cus- would include all ‘‘associated trees,’’ ‘‘in- challenges in terms of this and future genera- tomarily, the whale is divided and shared by sect-infected trees’’ and ‘‘trees imminently tions' responsibility to prioritize Government all of the people in the community free of susceptible to fire or insect attack’’—in other words, anything that can be cut. spending in a fiscally prudent fashion. I am charge. A recent BLM memo correctly character- pleased that the Jaycee Alliance has already In recent years, Native whaling captains ized it as ‘‘more or less a license for unregu- pledged its support for the balanced budget have been treating their whaling expenses as lated timber harvest.’’ amendment, which I too have supported a deduction against their personal Federal in- Second, the House Interior Appropriations throughout my years in public office. come tax, because they donate the whale bill would virtually zero-out funding for Na- Many young business people and home- meat to their community and because their ex- tional Park Service management of the new makers are striving to achieve the American penses have skyrocketed due to the increased Mojave National Preserve, created last fall dream and make their communities better costs in complying with Federal requirements as part of the California Desert Protection Act. places to live. These are bright, energetic peo- necessary to outfit a whaling crew. The IRS Not satisfied with having won a battle to ple who are interested in securing and creat- has refused to allow these deductions, placing permit continued hunting and grazing in the ing high-wage jobs, keeping their streets safe, an extreme financial burden on those who use preserve, Representative Jerry Lewis, R-Red- and promoting the highest quality of education personal funds to support their Native commu- lands, along with ranching and mining inter- in their children's schools. The challenges we, nities' traditional activities. Currently five whal- ests, are pressing ultimately for a reversal of as Americans, face are certainly daunting, but ing captains have appeals of these disallow- the Desert Protection Act, which took eight they pale in comparison to the energy this ances pending before the Tax Court of the years to negotiate. It seems not to matter a whit to Lewis young, invigorated group has to offer. Now is IRS. that many of his own constituents, including the time that people in the early and middle The bill I am introducing today would amend the San Bernardino County Board of Super- stages of their careers should mark as the day section 170 of the Internal Revenue Code to visors, which originally opposed the pre- on which they were invited to get involved. In provide that the investments made by this rel- serve, is now enthusiastic about winning full the finest tradition of the Jaycees, I am con- atively small and fixed number of subsistence funding for it, having noted that tourist vis- fident that the alliance will succeed in becom- Native whaling captains are fully deductible as its in the area have increased dramatically ing the voice of young Americans. charitable contributions against their personal since the preserve was established. Federal income tax. Such an amendment Finally, the same legislation would open f should also retroactively resolve the disallow- up all federal waters on both the Atlantic ALASKA NATIVE SUBSISTENCE and Pacific coasts to leasing by oil and gas ance and assessment cases now pending extractors, reversing a 14-year moratorium WHALING EXPENSE CHARITABLE within the statute of limitations. on offshore drilling that has enjoyed biparti- TAX DEDUCTION The expenses incurred by these whaling san support, including that of Governor Wil- captains are for the benefit of the entire Native son. HON. DON YOUNG community. These expenses are vital contribu- Laughingly, congressional Republicans ar- OF ALASKA tions whose only purposes are to provide food gued that the United States is too dependent IN THE HOUSE OF REPRESENTATIVES to the community and to perpetuate the ab- upon foreign oil and that it would be irre- original traditions of the Native subsistence sponsible not to explore all domestic Tuesday, June 27, 1995 sources. But a Department of Energy study whaling culture. shows that there are approximately 726 mil- Mr. YOUNG of Alaska. Mr. Speaker, I rise Each Alaskan Native subsistence whaling lion barrels of proven reserves off the Cali- to introduce a measure that would provide captain spends an average of $2,500 to fornia coast. critically needed tax relief to a few Alaskan $5,000 in whaling equipment and expenses in This means that, in exchange for allowing Native whaling captains who otherwise may a given year. A charitable deduction for these oil derricks to threaten spills along the en- not be able to continue their centuries-old tra- expenses would translate into a maximum rev- tire length of our coast, the nation would get dition of subsistence whaling. In brief, this bill enue impact of approximately $230,000 a all of 41 days worth of energy from proven oil would provide a modest charitable deduction year. reserves—a bargain that only members of Congress in thrall to oil companies could ap- to those Native captains who organize and Such a charitable deduction is justified on a preciate. support traditional whaling hunt activities for number of grounds. The donations of material President Clinton, get out the veto pen. their communities. and provisions for the purpose of carrying out f The Inupiat and Siberian Yupik Eskimos liv- subsistence whaling, in effect, are charitable ing in the coastal villages of northern and contributions to the Inupiat and Siberian Yupik THE JAYCEE ALLIANCE MOBI- western Alaska have been hunting the communities for the purpose of supporting an LIZES YOUNG AMERICANS TO bowhead whale for thousands of years. The activity that is of considerable cultural, reli- GET INVOLVED International Whaling Commission [IWC] has gious, and subsistence importance to those acknowledged that ``whaling, more than any Native people. In expanding the amounts HON. JAMES A. BARCIA other activity, fundamentally underlies the total claimed, a captain is donating those amounts OF MICHIGAN lifeway of these communities.'' to the community to carry out these functions. IN THE HOUSE OF REPRESENTATIVES Today, under the regulatory eye of the IWC Similarly, the expenditures can be viewed and the U.S. Department of Commerce, these as donations to the Inupiat Community of the Tuesday, June 27, 1995 Natives continue a sharply restricted bowhead North Slope [ICAS], to the AEWC, and to the Mr. BARCIA. Mr. Speaker, I take great pride subsistence hunt out of 10 coastal villages. communities' participating churches. The ICAS today in saluting the commencement of an or- Local regulation of the hunt is vested in the is a federally recognized Indian tribe under the ganization created so that young Americans in Alaska Eskimo Whaling Commission [AEWC] Indian Reorganization Act of 1934 (48 Stat. their twenties, thirties, and forties can have a under a cooperative agreement with the De- 984). Under the Indian Tax Status Act, dona- collective voice on pertinent Federal issues of partment of Commerce, National Oceanic and tions to such an Indian tribe are tax deductible the day. The Jaycee Alliance is a new na- Atmospheric Administration. (28 U.S.C. 7871(a)(1)(A)). The AEWC is a tional, grassroots organization, boasting The entire Native whaling community partici- 501(c)(3) organization. Both the ICAS and the 150,000 members, that will allow concerned pates in these hunting activities. However, Na- AEWC are charged with the preservation of and involved young leaders to contribute their tive tradition requires that the whaling captains Native Alaskan whaling rights. thoughts and experiences on issues before are financially and otherwise responsible for Also, it is important to note the North Slope the U.S. Congress and State legislatures, and the actual conduct of the hunt; meaning they Borough of Alaska, on its own and through the will form a compact between each generation must provide the boat, fuel, gear, weapons, AEWC, spends approximately $500,000 to of Americans to the next. ammunition, food, and special clothing for their $700,000 annually on bowhead whale re- I applaud the success of the U.S. Junior crews. Furthermore, they must store the whale search and other Arctic marine research pro- Chamber of CommerceÐJayceesÐorganiza- meat until it is used. grams in support of the U.S. efforts at the tion and I proudly point to my membership as Each of the approximately 35 bowhead International Whaling Commission. This is a Jaycee at an early age as essential in my whales landed each year provides thousands money that otherwise would come from the professional development. I firmly believe that of pounds of meat and muktukÐblubber and Federal budget to support the U.S. represen- the new Jaycee Alliance is an intelligent and skinÐfor these Native communities. Native tation at the IWC. much needed organization that will edify and culture dictates that a whaling captain whose Given these facts and the internationally mobilize thousands of new leaders into the crew lands a whale is responsible for feeding and federally protected status of the Native June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1333 Alaskan subsistence whale hunt, I believe ex- endeavor. The sacrifices made by the commu- money to create programs that fall just penditures for the hunt should be treated as nity on behalf of each child will pay many divi- short of lunacy. Liberals don’t expose their charitable donations under section 170 of the dends in the form of productive, well-rounded children to this nonsense—they enroll their children in private schools. Internal Revenue Code. I ask my fellow Mem- citizens. Victims of the liberals are mostly poor, bers to join with me in clarifying the Federal f black people who have few options—such as Tax Code to make this a reality for these Na- Sheila Stamps, a widowed mother of five liv- tive whaling captains. AMERICAN CHILDREN DESERVE ing in a housing project. She complains, f EDUCATIONAL CHOICE ‘‘You can’t let the children out by them- selves, and the playground is littered with RECOGNITION OF ORLANDO HON. THOMAS J. BLILEY, JR. intravenous needles.’’ Like most black par- YARBOROUGH AND GROUP ents, Ms. Stamps wants school choice, say- OF VIRGINIA ing: ‘‘Any child in this city should be able to IN THE HOUSE OF REPRESENTATIVES go to the best schools. If they meet the cri- HON. ROBERT L. EHRLICH, JR. Tuesday, June 27, 1995 teria, let them go.’’ But her liberal ‘‘bene- OF MARYLAND factors’’ say no. IN THE HOUSE OF REPRESENTATIVES Mr. BLILEY. Mr. Speaker, I commend to the When black Americans finally come to the attention of Members the following article by Tuesday, June 27, 1995 full realization of what liberals have done to Walter Williams which appeared in the June them, it’s going to make last November’s po- Mr. EHRLICH. Mr. Speaker, I rise today to 23, 1995, Richmond Times Dispatch. I believe litical revolution look like a Girl Scout out- publicly recognize an outstanding group of Mr. Williams' remarks paint an honest portrait ing. people in my district. Because of the great of the debate surrounding the critical need for f number of outstanding citizens in the Second school choice. JUNIOR HIGH STUDENTS HAVE District of Maryland, I am hesitant to single out [From the Richmond Times Dispatch, June one particular example. This group, however, 23, 1995] LUNCH WITH THEIR REPRESENT- ATIVE has been selected for a great honor on behalf BLACK VICTIMS OF LIBERALS WANT CHOICE IN of the United States, and should be so recog- EDUCATION nized. (By Walter Williams) HON. HENRY J. HYDE Mr. Orlando Yarborough works with at-risk The nation’s capital provides one of the OF ILLINOIS youngsters in the Essex-Middle River area of best examples of the destructiveness of lib- IN THE HOUSE OF REPRESENTATIVES Baltimore County. This area is a very strong, eral ideas. Washington used to be a thriving working class area that has been slow to re- city where free persons of color and freed Tuesday, June 27, 1995 cover from the most recent recession. There- slaves established flourishing family busi- Mr. HYDE. Mr. Speaker, those who believe fore, opportunities for young people to get in- nesses. As early as 1899, the black students of that youth are not interested in public affairs volved in programs that give them self-esteem Washington’s Paul Lawrence Dunbar High have not met the eighth grade class at School scored higher than any of the white and a sense of accomplishment are critical. schools in the District of Columbia. From Churchville Junior High in Elmhurst, IL. In a Mr. Yarborough developed an after school 1870 to 1955, most Dunbar graduates went to contest, sponsored by the school's social stud- personal power package for kids. Participants colleges like Oberlin, Harvard, Amherst, Wil- ies department, the students were asked to sign a contract to improve their bodies as well liams, and Wesleyan. Washington was home write an essay entitled, ``Why I would like to as their minds in activities done at the Body to a broad, upwardly mobile black middle have lunch with Representative Hyde.'' The Mechanics Family Fitness Center. The pro- class. students used the opportunity to voice opin- gram encompasses academic and physical All that has changed. According to Philip ions on a wide range of issues. Many also ex- exercises, community service, and a discus- Murphy’s article in Policy Review, Washing- pressed interest in running for public office ton has ‘‘the highest per-capita murder and sion of personal improvement. The contract violent-crime rates, the highest percentage and making positive contributions to govern- also specifies that participants will not smoke, of residents on public assistance, the high- ment in the future. I would like to share with fight, use profane language, nor use drugs or est-paid school board, the lowest SAT scores, my colleagues the six winning essays, I and alcohol. the most single-parent families, and the am happy to report that we had lunch and dis- The program has the enthusiastic support most lawyers per capita.’’ cussed some of the students' concerns and and financial backing of many local business People are fleeing Washington in droves. questions about political office. During the second half of the 1980s alone, and community groups, as well as prominent HENRY HYDE members of the community at large. over 157,000—one-fifth of Washington’s popu- lation—moved. This exodus disproportion- (By Gwen Infusino) Mr. Speaker, recently Mr. Yarborough's ately consisted of black households earning I wish to have lunch with the prominent group was selected to attend ceremonies between $30,000 and $50,000 a year. Today, politician, Henry Hyde. I would very much commemorating the 1,500th anniversary of the Washington’s population is 578,000, down enjoy expressing my political opinions. I founding of the Shaolin Temple in mainland from a peak of 800,000. would enjoy meeting him because I want to China. The selection was based on the pro- To blame racism for Washington’s emer- know about the life of a politician. Also, I gram's emphasis on discipline, perseverance, gence into a bankrupted Third-World-type am interested in the way government works. and character development. They are the only city requires a lot of imagination. Washing- I would very much enjoy expressing my po- U.S. citizens to be invited to this very historic ton is a city where the mayor is black, the litical opinions. I’m concerned about society, chief of police is black, the school super- environment, and many other issues. I’m event. While in China, the team will be train- intendent is black, and most of the city happy to imagine that I just might make a ing, performing demonstrations, speaking at council is black. Can we blame poor revenue difference. I’m sure Mr. Hyde is open to all local schools, and generally acting as good sources? According to Murphy, the city kinds of opinions and suggestions. will ambassadors of the United States. They takes in an astonishing $8,950 in revenue for I would enjoy meeting him because I want will be introducing American ideas and culture every man, woman, and child in its jurisdic- to know about the life of a politician. At this to their hosts as well as bringing some of Chi- tion. That’s to be compared to $4,000 and point in time, many people my age are mak- na's rich culture and heritage back to share $3,700 in nearby Maryland and Virginia, re- ing career decisions. These will affect us for with their friends and families. spectively. Nonetheless, the city is in receiv- the rest of our lives. If I find a politician’s ership. Its bonds have achieved junk status life appealing, I might choose to get into This, Mr. Speaker, is what I want America to because it manages to spend $1,000 more per that field. stand for: kids who take the responsibility to person than it receives in revenue. I am interested in the way government constructively improve themselves and their Washington’s story can be told in varying works. America is where I live, and so will communities without turning to the evils of degrees in other predominantly black cities. all of our children. I want to learn a bit substance abuse or crime. Similarly, we The story is a monument to the failure of about our system so I know how it works and should honor adults like Mr. Yarborough who the liberal ideas of Democrats, black politi- how safe it makes it for us all. I feel knowing care enough about their communities and their cians, and civil-rights organizations. Lib- about our political and judicial system is a kids to put forth the effort in making programs erals have convinced blacks that we deal must for us all. with crime not by arresting and locking up In conclusion, I would like to meet Henry like this work. criminals but by searching for crime’s origi- Hyde for three prominent reasons. I want to Mr. Speaker, I could not be more proud of nal causes. This theory gives criminals carte know about the life of a politician. I am in- Mr. Yarborough and his kids. They are our fu- blanche to prey on law-abiding citizens. Lib- terested in expressing my political opinions. ture. And I want to recognize Mr. Yarborough erals have convinced blacks that we deal I want to ask him about our government and and everyone else connected with this noble with education fraud by spending more the way it works. E 1334 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995

WHY I WOULD LIKE TO EAT LUNCH WITH WHY I WOULD LIKE TO GO TO LUNCH WITH WHY I WOULD LIKE TO HAVE LUNCH WITH CONGRESSMAN HYDE REPRESENTATIVE HYDE REPRESENTATIVE HYDE (By Jodi Carnevale) (By Megan Guimon) (By Heidi Wilberschied) I can’t even begin to tell you all the rea- For a thirteen year old I have very strong I think that being able to go out to lunch sons I want to go! In fact when I first heard opinions that I share with people to show with Representative Hyde would be a great about it I told my whole family! (I was very them how I feel. Congressman Hyde did the privilege, and something we will probably excited). These are some of the reasons I same thing. That is why I would be honored never again have the chance to experience. want to go: It’s a chance of a life time, I’ve to eat lunch with him and talk one on one. As eighth graders, this is our last year at- got a lot of questions, I want to know how it Congressman Hyde had made a presen- tending Churchville, and this would be a per- feels to be in this position, and most impor- tation on abortions and why he was very fect last memory of it. My Uncle Roy tantly I want to be in a similar position anti-abortion. I was lucky enough to hear his McCampbell is a trustee in Leyden Town- when I grow up. presentation, and even get a cassette tape of ship, and I have heard Representative Hyde’s It’s definitely a chance of a lifetime. I’ve the speech. I have the same morals on abor- name since I was little. I think it would be always had dreams of meeting the president, tion that he does, and I find it interesting great to finally get to meet him in person, that someone older than me has the same not to mention being the president. Rep- and actually get to talk to him. I think that resentative Hyde is just as important. Also, feelings I do about abortions. It would be an it would be very fascinating to hear ideas exciting, as well as educational experience I don’t know anyone who’s had such a chance and views from a person that has such a like this, it’s one of the highest privileges I for me to tell him how I feel, and to tell him great deal to do with the outcome of them. that as a kid, I greatly respect him for hav- can think of. I don’t know very much on the government I have many questions, such as, ‘‘What do ing such strong feelings, and publicly ad- system, and it seems like a lot of work, with dressing them on such a strong world-wide you exactly do? Do you agree with other sen- very many obligations and pressures at- ator’s opinions? Do you enjoy your job’’? debate. I would also like to know if since he tached to it. Though I know in my heart that addressed his opinion on abortions publicly if There is so much an 8th grader is deprived of I will never get into politics as a career, I knowing on this subject. (Although it isn’t he has received any remarks on his position still believe that it is very important to un- regarding abortions. It’s not very likely that due to Mr. Caldwell’s and Mr. Heap’s exper- derstand and experience all different areas. I tise in the field of Social Science/Studies.) someone with as much authority as Con- know that a chance like this is very rare, gressman Hyde states his position. I admire I want to know how it feel’s to be in this and this is why I felt that I should try to get position. It’s a great honor. He hold’s many that greatly. involved. I think that it is very important I also believe it would be fun to talk to people’s trust and opinions. After all that’s for kids our age to understand or at least ac- how he got chosen. Is his position stressful him one on one to find out his positions on knowledge our government system. That’s other world-wide problems. I would like to or successful? why I believe that this is such a perfect Most importantly I want to be in a similar know if he has made a speech about any chance for all of us. I think that it is com- other topic, and if so, where you can find position when I grow up. Ever since I was pletely different than listening to an already young I’ve been interested and intrigued by them, because his speeches make an impact prepared speech. I think that this is such a on me and I would like to have more. our government. I’ve wanted to be in a gov- terrific program that Churchville has setup, ernment position for four years. I know it’s That is why I would like to eat lunch with and Representative Hyde has fit us into his Congressman Hyde, I respect him for telling a big dream, and I know it will take many surely tight schedule, and I hope to be a part years of hard work, but I want it. I want to the truth, and I know he is open and willing of it. to state his opinion on issues as big as abor- hold a high government position, so you can tions. I would also like to go out with him be sure I’ll get it. That’s why I want this op- because I would just like to tell him how WHY I WOULD WANT TO HAVE LUNCH WITH portunity so much, I need much information much I admire his way of speaking out to HENRY HYDE and education now so I can start forming people. opinions now, so I’ll be familiar and knowl- (By Joy Tetrick) edgeable in this field in my upcoming years. To conclude my points; It’s a chance of a WHY I WANT TO GO TO LUNCH WITH HENRY I would very much enjoy having lunch with life time, I’ve got a lot of questions, I want HYDE Dupage County Representative, Henry Hyde. It would be a very honorable and memorable to know how it is to be in this position, and (By Melissa Greco) experience. I want to be in this position. I really want to I would like to go to lunch with Henry One reason I would like to go to lunch with go. Hyde because it will expand my knowledge in Henry Hyde is to find out the answers to f social sciences and in politics. I am very in- some questions I have. It would be interest- terested in people’s opinions and I would like ing to see what he does all day, how stable is IN APPRECIATION OF CHRISTIAN to ask Mr. Henry Hyde some questions of my his job, to find out how they come up with RELIEF SERVICES ON THEIR own. I have lots of respect for people in- new laws, how much he has to work a week, 10TH ANNIVERSARY volved in making our government work and etc. It would also be interesting to find out settling laws. I have lots of opinions of my how he got in politics, like if he was a lawyer own and I would love to represent and then decided to try out for a position. I HON. JAMES P. MORAN Churchville. would also want to know if he enjoys his job, OF VIRGINIA Some topics that I would like to discuss if it’s pressuring at times, how his family IN THE HOUSE OF REPRESENTATIVES with Congressman Hyde are: gun control, feels about it. abortion, our national debt, and the baseball Tuesday, June 27, 1995 strike. I want to know if he thinks that guns Henry Hyde is very well respected and again, it would be an honor to have lunch Mr. MORAN. Mr. Speaker, I would like to should be outlawed or if they should remain commemorate the 10th anniversary of Chris- on the streets. Then I would discuss my opin- with him. I would be on my best behavior at ion on this matter. I also want to know if he all times if I was chosen, and I think I would tian Relief Services, an international, chari- believes in abortion and his reasoning. An- be a good representative of Churchville Jun- table organization located in Lorton, VA. other issue I would like to ask him about is ior High School. Throughout its 10-year history, Christian Relief the baseball strike. Does he believe that the I would also like to talk to him about some Services has always had one overriding goal: players or the owners are being unfair? I ideas I have. One idea is about Salt Creek. I to help those in need both in the United States would also like to know what he is doing to live right by Salt Creek so I know how pol- and around the world. help reduce our national debt. I would also luted it is. It is so polluted that York High From the hollows of Appalachia and the bar- School wouldn’t let my brothers class test like to ask Congressman Hyde what laws he ren plains of the Pine Ridge Indian Reserva- is trying to pass now. some things out because it was too dan- I will represent Churchville by displaying gerous. tion in South Dakota, to a children's home in well behaved manners. I always respect my It would also be neat to see a bigger recy- Kenya and the first pediatric hospital in Haiti, elders and am very polite to others. I would cling program. In our school were have a re- and to the children of Chernobyl in Ukraine, love to have the honor of representing cycling program for paper but I’m talking Christian Relief Services has touched lives. Churchville and meeting Mr. Henry Hyde. about going farther than that. I’m talking Just minutes from this building are some of I think that politics is very interesting and about having a recycling program for the the poorest neighborhoods of Washington, one day I would like to become a part of it cafeteria. For Styrofoam, plastic, etc. It DC. Just minutes from this building are chil- and represent, not only Churchville but the would be neat to have it in all schools in dren who go to bed hungry every night, who United States. This opportunity would bring DuPage county. Also, to have recycling pro- me one step closer toward this goal. As I grams for home. I know Elmhurst has one wake up hungry the next morning, who never mentioned, I would like to hear out Mr. but Addison doesn’t. In Addison you have to have enough to eat. Christian Relief Services, Henry Hyde’s ideas and reasoning on impor- buy plastic bags. Most people don’t want to through its food distribution programs, has tant issues that we are dealing with in our buy them. It would be neat to see all DuPage reached these people. Working with local society everyday. county doing these ideas. churches and civic organizations, over June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1335 100,000 pounds of fresh fruit and vegetables merce. While there, he was responsible for vironmental stewardship. In 1987, Jack was have been distributed to the needy in northern designing a financial plan enabling the city to named to the Forestry Advisory Council, that Virginia, Washington, and suburban Maryland participate in urban renewal projects of over reviews forestry division programs. just in the past 2 months. $100 million. Jack's other interests included his busi- As great as our Nation is, poverty and need Before coming to Ohio Edison, Dan was di- nesses and helping the community. He was a still exist. The innercities, Appalachia, small rector of finance for the city of Akron. As its towns, Indian Reservations, and rural areas all chief financial officer and a member of the cofounder and chairman of Western Carolina have people in need of assistance. Christian mayor's cabinet, he was responsible for long- Bank and a past director of Carolina Power & Relief Services is meeting these needs, and range planning, budgeting, debt management Light Co. At one time, he operated Benis has been for 10 years, by giving people a and accountability of all city funds. Hardware Lumber Co., Williams-Bronwell hand up, not a hand out. This is their motto, Through the years Dan has been active in planing mill, Educational Lumber, and Veach- and through long-term development projects a variety of community and business groups. May-Wilson, Inc. Jack was chairman of the they are providing people with the foundations He is on the board of directors of the Ohio United Way of Asheville and Buncombe Coun- they need to improve their lives for them- Chamber of Commerce, the board of trustees ty. He was a member of the All Saints Church selves. Organic gardening programs on the of the Ohio Public Expenditure Council, and a in Mills River and an integral part of the Re- Pine Ridge Reservation and vocational-tech- member of the Akron Regional Development publican Party. nological classes in West Virginia are but two Board Taxation Committee among others. In Jack Veach was an innovator in the timber examples. addition, he is a visiting lecturer at Akron Uni- industry and a leader in the community. His Long-term development is a focus of Chris- versity and involved with the Weathervane energy and excitement motivated our commu- tian Relief Services projects overseas, as well. Community Playhouse. nity. The loss of this remarkable man will be The Kip Keino Children's Home in Eldoret, Mr. Speaker, it is obvious that the Akron felt by all. Kenya, in addition to giving abused and aban- community and the State of Ohio have bene- doned children a safe and supportive place to fited greatly from Dan's hard work and dedica- f live and grow, provides for their education, tion over the years. His service is a model of and allows them to become happy, productive citizenship. I ask my colleagues to join me RECOGNITION OF NATIONAL members of society. Currently, 68 children live today in wishing Dan Zeno and his wife June AMATEUR RADIO WEEK at the home. Over the years, 90 children have well as they begin this new chapter in their been rescued by the home and given new lives. lives. f HON. BUD SHUSTER Pick up today's newspaper and you will read of far-off lands in turmoil: Haiti, Bosnia, IN MEMORY OF JOHN B. VEACH, OF PENNSYLVANIA Rwanda, Somalia. Within the past year alone, SR. IN THE HOUSE OF REPRESENTATIVES Christian Relief Services has shipped count- less tons of emergency medical supplies, HON. CHARLES H. TAYLOR Tuesday, June 27, 1995 food, clothing, building materials, and other re- OF NORTH CAROLINA Mr. SHUSTER. Mr. Speaker, today I rise in lief items to refugees from these areas. As our IN THE HOUSE OF REPRESENTATIVES support of National Amateur Radio Week Government appears to be pulling inward, it is Tuesday, June 27, 1995 important and commendable for Christian Re- which runs from June 18 to 24. I would like to lief Services to reach out an American hand to Mr. TAYLOR of North Carolina. Mr. Speak- take time to recognize this activity, the people those less fortunate in places some would er, I rise today to honor a very special person involved in it and the service to our country write off as not being in our national interest from western North Carolina, John ``Jack'' B. which it performs. to help. Veach, Sr. Jack passed away on Thursday, Currently, there are over 500,000 amateur Christian Relief Services is about connect- June 19, at the age of 95. With great sadness, radio operators in the United States and ap- ing with people, about caring for them and I offer my condolences to his wife Jane, and proximately 2,500,000 amateur, ham, radio his son, John B. Veach, Jr. Jack was a pio- their families, and about making a difference operators worldwide. And, due to the many neer in North Carolina's timber industry and in their lives. technological advances which have made our For 10 years, Christian Relief Services has one of the great leaders of the community. Jack was respected by those in commerce world smaller and even the most remote vil- made a difference in the lives of many people. lage accessible, ham radio operation has be- Each day, this number grows. For this reason, and public service for his outstanding leader- come an increasingly popular hobby. Count- and on behalf of these people, I would like to ship and great inspiration to all the people of less friendships have been formed over the say thank you, Christian Relief Services, for North Carolina. His energy and love for help- 10 years of service to humanity, for making ing those in the community kept him involved airwaves. In some cases, people have even the world a less harsh place, for feeding those in public service up to the final days of his life. found their spouse through ham radio commu- who are hungry, for providing the supplies to Much of his success in business and politics nication. make well those who are sick, and for giving can be attributed to the fact that he was a true While amateur radio allows its users to learn hope to those who had none. gentleman. the similarities and differences between one f Jack was nationally known for his work as another's geographies and cultures, it per- a forester in the timber industry. He was past forms a significant service to our Nation. In TRIBUTE TO DAN ZENO ON THE president of Appalachian Hardwood Manufac- times of crisis or tragedy ham radio operators OCCASION OF HIS RETIREMENT tures Inc., American Forest Products Indus- form networks providing information and lines tries, National Manufacturers Association, of communication which would otherwise be HON. PAUL E. GILLMOR North Carolina Forestry Association, and Asheville Area Chamber of Commerce. He inaccessible. Several national organizations OF OHIO have formal agreements with the Amateur IN THE HOUSE OF REPRESENTATIVES was voted Man of the Year by the Southern Hardwood Lumber Association, and twice Radio Emergency Service [ARES] and other Tuesday, June 27, 1995 voted Man of the Year by the North Carolina amateur radio groups. These groups include Mr. GILLMOR. Mr. Speaker, I rise today to Forestry Association. In 1985, the Southern the Federal Emergency Management Agency, pay tribute to an outstanding individual and a Appalachian Multiple Use Council honored the American Red Cross, the Salvation Army, good friend of Ohio, Dan Zeno, who is retiring Jack for having the most influence over west- the National Weather Service, and the Na- on June 30, 1995, after a distinguished career ern North Carolina forestry during the past 50 tional Communications System. with Ohio Edison. years. In 1993, he was inducted into the West- In conclusion Mr. Speaker, I applaud all An Ohio native, Dan graduated from To- ern North Carolina Agricultural Hall of Fame those who helped to make National Amateur ronto High School in Toronto, OH, and served as a forester and civic leader. His strongest Radio Week a reality. I believe this to be a as a sergeant in the United States Army in efforts were always centered toward the re- wonderful activity which in time of need, per- Korea from 1950 to 1953. After the Army, Dan generation of the forests in western North forms a wonderful service to our Nation. pursued a degree in finance at Kent State Uni- Carolina. These efforts led to the creation of versity. In 1961, he began a career in public the Cradle of Forestry Discovery Center, service at the Akron Area Chamber of Com- where others could be taught forestry and en- E 1336 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 ACTION ON FINAL RESOLUTION OF Mr. Speaker, Mr. Bell's contributions to the Finally, the bill expedites the removal of GIBBS AND HILL AGAINST THE architecture of this great country include many criminal aliens by eliminating some procedures GOVERNMENT of the finest buildings on the east coast, in- and redtape. cluding the Federal building here in Washing- I commend the administration for their initia- HON. DAN BURTON ton. tive and I look forward to working with my col- In addition, Mr. Bell's work can be seen in OF INDIANA leagues to produce legislation that deals the Union Theological Seminary, the Federal IN THE HOUSE OF REPRESENTATIVES thoughtfully with the serious challenges we Bank, and the Richmond City Hall. Tuesday, June 27, 1995 Mr. Bell leaves, to cherish his memory, face. Mr. BURTON of Indiana. Mr. Speaker, I rise three daughters, Elinor B. Pollard, Marion Hill, f today to voice a specific and direct concern, and Geraldine Anderson, seven grandchildren, and a demand for action from our State De- five great grandchildren, and one great-great CONGRATULATIONS TO MELVIN partment, over the inexcusable delay in the grandson, and a host of other relatives and DANAO TABILAS ON HIS EAGLE final resolution of the $43.4 million commercial friends. SCOUT AWARD claim of Gibbs & Hill against the Government Mr. Speaker, to this good and decent man, of the Kingdom of Saudi Arabia. This claim is the oldest member of the Mount Carmel Bap- the last remaining unpaid claim under the spe- tist Church Deacon Board, the proud father of HON. ROBERT A. UNDERWOOD cial claims process established by the Con- three and a builder for all seasons, thank you. OF GUAM gress in 1992 in recognition of a pattern of f commercial abuse by the Kingdom towards IN THE HOUSE OF REPRESENTATIVES the American companies working there during INTRODUCTION OF THE IMMIGRA- the period of the late 1970's and early 1980's. TION ENFORCEMENT IMPROVE- Tuesday, June 27, 1995 Gibbs & Hill's story is not unlike that of all MENTS ACT OF 1995 Mr. UNDERWOOD. Mr. Speaker, in my of the other American companies whose claims were satisfactorily resolved by Saudi home district of Guam, we have many out- HON. HOWARD L. BERMAN standing young people. However, one young Ambassador Bandar under the special claims OF CALIFORNIA man from Boy Scout Troop No. 38 deserves process. Gibbs & Hill provided services to the IN THE HOUSE OF REPRESENTATIVES Kingdom and was not paid for the services special mention. Whenever a Scout earns the Tuesday, June 27, 1995 provided. The claim was notified to the Saudi rank of Eagle, the accomplishment stands out Government for resolution under Ambassador Mr. BERMAN. Mr. Speaker, I rise today to as a milestone in his life. Melvin Danao Bandar's mandate to resolve these claims' introduce the Immigration Enforcement Im- Tabilas is the only person on Guam to get the and Ambassador Bandar pledged to spare no provements Act of 1995 on behalf of the Clin- Eagle Scout Award this year. This triumph efforts in so doing fairly and expeditiously. ton administration. This bill builds upon the alone predicts future successes, but there are This was more than 2 years ago. Since that strong effort this administration has been mak- many things about Melvin worth watching. time, a message on behalf of none other than ing to control illegal immigration. This Eagle Scout plans to attend college the King has been provided to our country's This administration has done more to close and major in the fields of medicine and music. representative in Riyadh that the claim was the door on illegal immigration than any pre- I have heard him play piano at family func- soon to be paid. Yet the claim still has not vious administration. With expected increases tions; he has the gift of harmony. A career in been paid. this year and next, border control staffing will music would be a natural, but this fine young We have included legislation in the fiscal have increased by 51 percent since President man plans to participate in medical missions Clinton took officeÐincluding border patrols year 1996 American Overseas Interest Act to to the Philippines after college. He wants to and inspectors at border crossing points and further the policy of our country that the claim provide medical assistance to the less fortu- airports. Deportation of illegal immigrants has be favorable resolved for the company, as has nate. I can close my eyes and see Melvin also tripled and the removal of criminal aliens has been repeatedly committed to by the Saudis to soothing patients with song. our Government and the company. This is been targeted. The budget of the INS has in- only the first of such steps the Congress can creased by over 70 percent from $1.5 billion in Melvin pledges to remain active as a Scout take to ensure that the wrongful acts of the 1993 to $2.6 billion requested for 1996. in the Order of the Arrow, and he will espouse Kingdom against Gibbs & Hill are rectified. The President, the Attorney General, and the values learned in Scouting throughout his What is needed, and what is expected from INS Commissioner Doris Meissner should be life. One needs only to examine his Eagle our State Department, is its immediate and credited for their effective leadership and com- Scout Service Project to grasp the sincerity of unrelenting effort to bring this matter to a suc- mitment to rising to the challenge of illegal im- this young adult. Melvin embarked on a beau- cessful conclusion, through the full and prompt migration. tification project for the central park in Dededo payment of the claim, so as to conclude suc- The legislation introduced today gives the where he lives. He recruited his friends, who cessfully the claims issue. Nothing short of administration a number of tools to control our put in over 130 hours of labor. In return for a this will be tolerated, nor is acceptable. The borders more effectively, to combat illegal hir- simple lunch, they painted the pavilion, plant- importance of the successful conclusion of this ing and to remove those who are here in vio- ed trees, picked up trash, and replaced the singular issue to our bilateral relationship can- lation of our laws. sand around the swing and slide. When the not be overemphasized. Until it is resolved, it The bill would make realistic increases in project began, garbage was everywhere, the will continue to fester and threaten to under- border enforcement personnel without jeopard- pavilion was covered with graffiti, and there mine our relationship with the Kingdom. izing the quality and safety of Border Patrol of- were only a couple of trees. In this fast-paced, f ficers and inspectors. Border control officers ever changing society, Melvin wanted his vil- know best what resources they need to do lagers to have a place to relax. From the plan- PERCELL ANTHONY BELL their job effectively, and this bill responds di- ning stage in April, 1994, Mel and his volun- rectly to their needs. teers completed the project 2 months later. The bill imposes stiff penalties for smuggling HON. WALTER R. TUCKER III Melvin Tabilas graduated from Father of immigrants, document fraud and other of- OF CALIFORNIA Duenas Memorial High School and is a Na- fenses. IN THE HOUSE OF REPRESENTATIVES tional Honor Society member. It's hard to keep The bill authorizes pilot programs to test up with him. He ran cross country for Father Tuesday, June 27, 1995 ways to verify that job applicants are eligible Duenas in 1992, and has been on the move Mr. TUCKER. Mr. Speaker, I rise today to to work in the United States. The goal is to ever since. He received the Governor's Art pay tribute to a builder. Mr. Percell Anthony find simple and effective ways of denying jobs Bell, a self-taught masterplasterer, was born to illegal immigrants to help eliminate the rea- Award and a Guam legislative resolution as a and raised in Richmond, VA. son why immigrants enter this country illegally. member of the San Vicente School Percus- In 1903, Mr. Bell was born to the proud par- The bill promotes coordination on workplace sionists. He performed at the Lytigo and Bodig ents of Charles E. Bell, Jr., and Julia Graham enforcement between the INS and the Depart- Telethon, using his talent to help others. Bell. He attended the Baker Street School and ment of Labor, since employers who hire un- Melvin has upheld the Scout oath. He has became one of the finest masterplasterers in documented workers often also violate other made his family, parents, and Congressman Virginia. labor standards. proud. Keep up the good work! June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1337 A SPECIAL TRIBUTE IN HONOR OF St. Mary's Episcopal Church to minister to Today, Mr. Speaker, I ask that you and our THE VERY REVEREND J. EARL area youth, the elderly, the hungry, and the colleagues join me, the congregation of the CAVANAUGH needy. From the beginning, Reverend Grace and Holy Trinity Cathedral, Reverend Cavanaugh became involved publicly and pas- Cavanaugh's family, and the citizens of Kan- HON. KAREN McCARTHY torally in dealing with the very difficult issues sas City, MO, in recognizing Reverend OF MISSOURI of the AIDS epidemic, working to instill Cavanaugh's outstanding achievements and IN THE HOUSE OF REPRESENTATIVES throughout our community a sense of true selfless contributions and in extending our compassion and concern for those inflicted congratulations and best wishes on the occa- Tuesday, June 27, 1995 with this terrible disease. He dedicated his sion of his retirement. Ms. MCCARTHY. Mr. Speaker, it is with spirit and his energies to creating a climate of f great pride and respect that I rise today to ecumenical cooperation and to fostering within bring to your attention, and to the attention of our community a heightened awareness of the TRIBUTE TO GEORGE LUTZA AND my colleagues, the fine work and outstanding continuing need for social, racial, gender, and CAROL SILVER LUTZA public service of the Very Reverend J. Earl economic justice. Cavanaugh. Among his many community activities, Rev- HON. HOWARD L. BERMAN On Sunday, May 21, 1995, I was honored to erend Cavanaugh has served with distinction OF CALIFORNIA join with the congregation of the Grace and as a member of the U.S. Interreligious Com- IN THE HOUSE OF REPRESENTATIVES Holy Trinity Episcopal Cathedral of Kansas mittee for Peace in the Middle East; as a Tuesday, June 27, 1995 City, MO, as well as the greater Kansas City member of the Downtown Council Board of Di- community, to salute Reverend Cavanaugh on rectors; as chaplain of the Harry S. Truman Mr. BERMAN. Mr. Speaker, I am honored to the occasion of his retirement after 19 years Good Neighbor Award Foundation; as a mem- pay tribute to George Lutza and Carol Silver as dean of the Cathedral. ber of the Martin Luther King, Jr. Interfaith Co- Lutza, corecipients of the Bernardi Senior Reverend Cavanaugh was born in Philadel- alition; on the Kansas City Community Joint Center's ninth Community Service Award. For phia, PA, on May 22, 1930. After graduating Committee on Homelessness; and on the the past 7 years George and Carol's com- from Lycoming College in Williamsport, PA, in mayor's task forces on AIDS and on hunger pany, Dynamic Home Care, has provided 1953 with an A.B. degree in English literature, and poverty. home chore and bathing services to home- he attended Drew Theological School in Madi- Within the Episcopal Church, at the national bound seniors referred by the Bernardi Center. son, NJ, receiving a master of divinity degree level, Reverend Cavanaugh has served on the Their goal is to ensure that seniors have af- in 1956. Upon completing a year of special executive council; was elected nine times as fordable and excellent health care. In that, study at the Church Divinity School of the Pa- deputy to the general convention of the execu- Carol and George have succeeded admirably. cific, he was ordained to the priesthood on tive church; served as a member of the Com- Carol and George serve on the professional June 18, 1958, diocese of Los Angeles, CA. mittee on the State of the Church; and served advisory council and the member advisory During the period 1958±1976, Reverend as a member of the House of Deputies Com- council of the Bernardi Center, which is lo- Cavanaugh served as vicar of St. Peter's mittee on Evangelism at the General Conven- cated in Van Nuys. They bring their own brand Church in Rialto, CA 1958±1961; vicar of St. tions held in 1973 and 1979. of dedication and energy to the center, in ad- Bartholomew's Church in Poway, CA 1961± In 1954, Reverend Gingrich married Nancy dition to providing a valuable service to the el- 64; rector of St. Barnabas Church and chap- Gingrich Cavanaugh of Philadelphia, PA. Mrs. derly of the northeast San Fernando Valley. lain to Episcopal students at Occidental Col- Cavanaugh graduated from the University of Both are busy in other organizations in- lege in Los Angeles, CA 1964±68; and rector Pennsylvania with an A.B. degree in econom- volved with the lives of senior citizens. For ex- of the Church of the Holy Faith in Inglewood, ics. She attended Claremont Graduate School ample, George is a member of the Elderabuse CA 1968±76. in Claremont, CA where she received a mas- Task Force, a member of Elders at Risk, a In March 1976, Reverend Cavanaugh be- ter's degree in education. Prior to the family's supporter of the Alzheimer's Association and came dean and rector of Grace and Holy Trin- relocation to Kansas City, Mrs. Cavanaugh the past chairperson of the Living at Home ity Cathedral in Kansas City, MO, the heart of worked for the Federal Reserve System, the Community Council. Carol has since 1987 the heartland and my hometown. California Department of Public Assistance, been chairperson of the Home Care Consor- As he had in his previous ministries, Rev- and the Rialto, Los Angeles, and Inglewood tium through Senior Care Network, which is erend Cavanaugh not only embraced his pas- California School Districts. Since 1977, she affiliated with Huntington Memorial Hospital. toral duties to his congregation but became an has taught second grade at the now-Pem- She is also cochairperson of the steering com- advocate and a leader in many areas of con- broke Hill School in Kansas City. While ac- mittee of the Greater Los Angeles cern and challenge to the community at large, tively involved in her own career, Mrs. Amyotrophic Lateral Sclerosis Association. establishing the place of the Cathedral as a Cavanaugh has been an integral partner in the Mr. Speaker, I ask my colleagues to join me center of worship and service to both the great works and the great successes of Rev- in saluting George Lutza and Carol Silver greater Kansas City community and the dio- erend Cavanaugh. One of the greatest gifts Lutza, public servants who work tirelessly for cese of West Missouri. Reverend Cavanaugh shared with Kansas City the betterment of senior citizens. They are a As dean of Grace and Holy Trinity, he ex- was Nancy Cavanaugh. She became a true shining example to us all. tended participation in the worship ministry to citizen of our city embracing with her heart our f both women and men at all levels; encour- cares and concerns, dedicating her personal aged and facilitated the development of con- time and energy to seeking solutions to our RECOGNITION TO LEWIS ‘‘DEE’’ gregational diversity by age, socio-economic problems and to celebrating our gains. WALKER and cultural background; advocated and im- Reverend and Mrs. Cavanaugh are the plemented the ordination of women to the proud parents of Helen Mary, who I had the HON. PATRICIA SCHROEDER presbyterate; and strengthened the relation- distinct pleasure of having as one of my stu- OF COLORADO ship of the Cathedral with other Christians and dents when I was on the faculty at the Sunset IN THE HOUSE OF REPRESENTATIVES members of other faiths through joint worship, Hill School. Helen is an attorney and is mar- study and community service. ried to Paul Stauts. Helen and Paul live in Tuesday, June 27, 1995 As Dean of Kansas City, Reverend Northern California and have four wonderful Mrs. SCHROEDER. Mr. Speaker, the Fed- Cavanaugh, working with the Grace and Holy children: Sydney, Alexander, Ethan, and eral Government is losing to retirement a dedi- Trinity congregation, provided vision and lead- Jacob. Helen's tribute to her father on Sunday, cated defender of both the U.S. Army and the ership in support of the community's efforts to May 21, brought tears of joy to my eyes. American environment. address the growing human needs and suffer- In 1976, when Reverend Cavanaugh came Lewis ``Dee'' Walker has been under the ing of the Kansas City population, in particular to the heartland of AmericaÐto Kansas CityÐ Secretary of the Army in charge of the envi- the residents of the downtown area and our he opened his heart to the congregation and ronment. It was his duty to recognize years of more troubled neighborhoods. As part of to our community. During his 19 years as environmental neglect at U.S. Army bases. It Downtown Ministries, Reverend Cavanaugh dean at Grace and Holy Trinity, Reverend became his responsibility to turn that neglect and the Grace and Holy Trinity congregation Cavanaugh played an extraordinary and criti- into a commitment to make contaminated land worked hand-in-hand with the Catholic Cathe- cal role in our community. He touched the safe for human health and the environment. dral of the Immaculate Conception, Grand Av- lives of so many people. His contributions will And Dee Walker performed in outstanding enue Temple, United Methodist Church, and long be remembered. fashion. E 1338 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 I am most familiar with his years of work to home to most of the men Union County sent Clark. Representative Clark grew up on his clean up one of the Army's most infamous to the first Congresses. family farm in a section of Elizabeth which is messes, the Rocky Mountain Arsenal. For On March 4, 1789, amid much fanfare, the now present-day Roselle. Born in 1726, Rep- over 10 years Walker showed great energy, first session of the First Congress began. Un- resentative Clark had a distinguished career patience, and determination to get where we fortunately for the new government, a quorum and contributed much to the founding of our are todayÐa comprehensive cleanup plan en- to conduct business was not reached in the Nation. He hated aristocratic privilege in any dorsed by all parties involved. His effort here House until April 1, and in the Senate until form and was outspoken in his advocacy for alone casts him a spot next to Hercules and April 4. One of the reasons for this absence of independence from England, culminating in his the Madonna. a quorum was the difficulty Members had in signing the Declaration of Independence. Al- Mr. Speaker, we owe a great debt to Dee reaching New York City, the home of the new though not formally educated in the law, Rep- Walker. And I wish him well in the future. government. Travel was slow during this pe- resentative Clark's zeal for giving free legal f riod, especially for Members from the Western advice earned him the nickname of ``the Poor States or those not near the coast or a river. Man's Counsellor.'' A BRIEF HISTORY OF UNION The trip must have been an easy one for Elias Because of his support for the American COUNTY, NJ, RESIDENTS WHO Boudinot, however, Union County's first resi- Revolution, he was chosen as a Delegate to HAVE SERVED IN CONGRESS, dent to serve in Congress. Representative the Continental Congress from 1776±78, and 1789–1808 Boudinot probably took a short ferry ride again from 1780±83, and finally from 1786 across Newark Bay, up the Kill van Kull, and until the Continental Congress largely dis- HON. BOB FRANKS finally across the Hudson River to reach Fed- banded in 1788. Delegate Clark was also cho- OF NEW JERSEY eral Hall, located on Manhattan's southern tip. sen as a delegate to the Constitutional Con- IN THE HOUSE OF REPRESENTATIVES It is interesting to note that prior to his trip to vention in Philadelphia, but ill healthÐhe suf- Tuesday, June 27, 1995 be sworn into the First Congress, Representa- fered from poor health his entire lifeÐpre- tive-elect Boudinot entertained President-elect vented him from attending. He would go on to Mr. FRANKS of New Jersey. Mr. Speaker, George Washington at Boxwood Hall, his two- oppose adoption of the Federal Constitution as a Member of the House of Representatives story mansion in Elizabeth. President-elect until the Bill of Rights was added in 1791. Re- from Union County, NJ, I recently became in- Washington was also on his way to New York elected to the Third Congress, Representative terested in my predecessors who represented City, to be sworn in as our Nation's first chief Clark's tenure in Congress was cut short by my home county during Congress' early years. executive. his death in 1794 at age 69. In honor of his During the first two decades of our Nation's Although born in Philadelphia, Representa- patriotism and many accomplishments, the fu- history, Union County sent five distinguished tive Boudinot lived and practiced law in Eliza- ture township of Clark, NJ, at the time a part gentlemen to serve in Congress. For many of beth when he was elected to the First Con- of Rahway, was named for him. these men, like Abraham Clark, who signed gress. A tall, dignified, and reportedly hand- the Declaration of Independence, and Jona- Also joining Representative Boudinot and some man, Boudinot was both cautious in his Clark in the Second Congress was Jonathan than Dayton, a signer of the U.S. Constitution, temperament and conservative in his politics. their service in Congress was but one of their Dayton of Elizabeth. Son of Elias Dayton, a His career before his congressional service Delegate to the Continental Congress, Rep- many contributions to our Nation during its was quite distinguished. He served in the Rev- formative years. And although some of these resentative Dayton was elected to the First olutionary Army, and was a Delegate to the Congress, but declined the office, preferring men have been obscured by the passage of Continental Congress in 1778. Delegate time, their accomplishments are remembered instead to become a member of the New Jer- Boudinot would serve again in the Continental sey council and later speaker of the New Jer- by many of my constituents, and still studied Congress from 1781 to 1783. During his ten- by scholars of this period. sey General Assembly. Born in 1760, he grad- ure, Delegate Boudinot gained valuable expe- uated from the College of New Jersey, now Before one can examine the Union County rience by serving on over 30 committees. He natives who served in the first 10 Congresses, Princeton University, became a lawyer, and also served as the Continental Congress' fought during the Revolutionary War, attaining a short primer on how Union County devel- tenth president during 1782±83, making him, oped is appropriate. Although settlers from Eu- the rank of captain. He was captured by the in a de facto sense, New Jersey's first elected British in Elizabeth, but obtained his freedom rope had been living in Union County for near- national leader. As my colleagues may be ly 200 years, Union County was not created in a prisoner exchange. In addition to his mili- aware, under the Articles of Confederation, tary service, he was also a delegate to the by the State legislature until 1857. As New there was no executive branch, and hence, no Jersey's youngest and second smallest coun- Federal Constitutional Convention, and had chief executive. The Continental Congress, a the honor of being the youngest signer, at 27, ty, Union County was originally part of its unicameral legislature, ran the entire govern- neighbor to the north, Essex County. In colo- of the U.S. Constitution. interestingly, he was ment. Furthermore, under the Articles, Dele- chosen to go to the Constitutional Convention nial times, what is now Union County was en- gate Boudinot's term was automatically abbre- compassed by the county's most populous after his father and Abraham Clark declined to viated because the terms of Delegates to the travel to Philadelphia because of poor health. community, ElizabethtownÐnow Elizabeth, Continental Congress were limited to 3 years. and the county seat. Elizabeth, a port town, As a House member during the first three In the Third Congress, Representative Day- was founded in 1665 by Sir George Carteret, Congresses, Representative Boudinot fathered ton became chairman of the House Committee who named the new settlement in honor of his many essential measures and participated in on Elections, one of the first standing commit- wife, Lady Elizabeth. practically all important debates. Boudinot led tees of the House. From that position, and be- No sooner had the little village of Elizabeth the defense of Hamilton's conduct of the Fed- cause he was a loyal Federalist, Representa- been founded than settlers pushed outward eral Treasury. He also was the first chairman tive Dayton attained the Speakership during onto the surrounding lands. As isolated farms of the Rules Committee, then a select commit- the Fourth and Fifth Congresses. were hewn from the forest, tiny hamlets devel- tee that had the important task of formulating As Speaker, Dayton has been described as oped, and new neighborhood names were the first rules of the new body. During his ten- being of ordinary ability, but of being person- born. Although these farms and small villages ure as chairman, Boudinot's leadership and ally popular, which helped temper the growing remained part of Elizabeth, they began to de- experience from serving in the Continental bellicose attitude of the House over the con- velop their own sense of identity and local Congress would prove invaluable to the First troversial Jay Treaty, which Dayton supported. concerns. By the end of the 18th century, divi- Congress. He is also seen as an active Speaker com- sion was inevitable. The first of the outlying After the Third Congress, Representative pared with his predecessors, and as someone areas to separate was Springfield, which was Boudinot declined to run for reelection. In who used his position to influence other Mem- created by the State legislature in 1793. The 1795, he accepted an appointment as director bers. He was also the first Speaker to speak next year Westfield incorporated, garnering its of the U.S. Mint. He moved to Philadelphia, out on issues before Congress when the name because it was the ``west field'' of Eliza- and sold Boxwood Hall to his House colleague House operated in the Committee of the beth. Then in close succession came Rahway Jonathan Dayton. He served as director of the Whole. in 1804, Union in 1808, and my hometown of Mint until 1805. Representative Boudinot died During his time in the House, Representa- New Providence in 1809. The rest of Union in 1821. tive Dayton argued in favor of having the sec- County's 15 communities would grow out of In the Second Congress, Representative retaries of the Treasury and of War appear in these 6 towns. Elizabeth would continue to Boudinot was joined by another Elizabeth na- the House, and for a larger regular army, rath- dominate the county politically, and would be tive, a slight, almost frail man named Abraham er than a militia. With Representative June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1339 Boudinot, he voted five times to uphold Hamil- eralist Party in New Jersey. His first political in Roselle, or the Belcher-Ogden Mansion ton financial policy. His first speech in the job was Essex County clerk, which he held home of Governors Ogden and Belcher in House was on his own motion to sequester from 1785±1803, coinciding with his brief ten- Elizabeth. These beautifully restored homes British debts. He also took part in the debate ure in the Senate. He was also a presidential are for both the casual visitor or the serious supporting the Washington administration's elector in 1796 for John Adams. In 1802, he historian. I urge my colleagues and all of my position in the Whiskey Rebellion. ran for a full 6-year Senate term, but was de- constituents, and especially my younger con- As Speaker at the outset of the Adams ad- nied reelection. He went back to New Jersey stituents, to discover Union County's proud ministration in 1797, Dayton increasingly found and resumed his law practice, and capped his heritage. himself in the middle of Jeffersonian attacks political career by serving as New Jersey's f on Hamilton's administration of the Treasury fifth governor. Department. This growing lack of comity Before his death in 1839, Governor Ogden HONORING CANTRELL’S SAC- reached a boiling point when Dayton had to would make one more significant contribution RIFICES AND CONTRIBUTIONS TO break up a fight between Jeffersonian Repub- to his Nation, not as a lawmaker, but as a de- HIS COUNTRY lican Matthew Lyon of Vermont and stalwart fendant in a civil case. In the early 1820's, a Federalist Roger Griswold of Connecticut on dispute arose with Thomas Gibbons, his HON. BART GORDON the House floor after Lyon spit in Griswold's former partner in the steamship trade. This OF TENNESSEE face over a political dispute. dispute resulted in the landmark Supreme IN THE HOUSE OF REPRESENTATIVES Dayton recognized that two noticeable fac- Court case Gibbons versus Ogden (1824). In tions in the Congress had developed. By 1800 this case, which Ogden ultimately lost, Chief Tuesday, June 27, 1995 these factions would be distinct political par- Justice John Marshall established important Mr. GORDON. Mr. Speaker, I rise today to ties, called the Federalists and the Democrat- constitutional precedents concerning the Fed- recognize and commend the contributions a Republicans. In 1798, Speaker Dayton de- eral commerce clause and the supremacy middle Tennessee family is making to pre- clined to run for the House again and instead clause's restraints on State power. serve and further the heritage of an outstand- ran and won a seat in the Senate as a Fed- In the Ninth Congress, with the retirement of ing Tennessee ancestor. eralist candidate. Republican Dayton is still the Senator Dayton, Union County's only native in Charles T. Cantrell will present his grand- only Speaker of the House ever from Union either body was freshman Congressman Erza father's Congressional Medal of Honor to County. Darby of Westfield. Born in 1768, Representa- American Legion Post 122 during a Ten- Although an active participant in the debates tive Darby was a farmer in what is now Scotch nessee bicentennial celebration scheduled for of the Senate, Dayton wielded considerably Plains. Unlike all of his predecessors from June 29, 1995. less influence than he had as Speaker. During Union County, Representative Darby did not Charles P. Cantrell, a Keltonburg native, his tenure in the upper body, Senator Dayton attend college, played either no or a minor was awarded the Congressional Medal of voted along Federalist party lines against the role in the Revolutionary WarÐhe was a Honor during the Spanish-American War for repeal of the Judiciary Act of 1801, and young teenager when the War endedÐand his acts of bravery. He was a member of the unit against the impeachment of Justice Samuel highest office he ever achieved was his brief that participated in the taking of San Juan Hill, Chase. After a visit to New Orleans in 1803, tenure in the House. Prior to his election as a the major stronghold of the Spanish. Without he favored the purchase of Louisiana, which Democrat-Republican to the House in 1804, consideration for his own safety, Cantrell was a Jefferson administration initiative. Day- he served as a freeholder, assessor, and jus- rushed to the front lines and rescued the ton served one term in the Senate, from 1799 tice of the peace, and a member of the New wounded from enemy territory. Cantrell es- to 1805. Jersey General Assembly for one term, 1802± caped the battle unharmed, and died in 1948 After leaving the Senate, Dayton was sup- 04. Re-elected to the Tenth Congress, Rep- at the age of 74. posed to accompany President Jefferson's first resentative Darby died in office on January 28, Until World War I, Cantrell was the only re- Vice President and his childhood friend Aaron 1808, and is interred at the Congressional cipient of the Medal of Honor in middle Ten- Burr on an expedition to the West, where Burr Cemetery in Washington, DC. nessee. apparently intended to conquer Spanish land From the time of the First Congress to Erza Now, years later, Tennesseans can person- and create an empire. However, Senator Day- Darby's death in 1808, the five men who ally, share the history that surrounded the ton became ill and was unable to make the ar- Union County sent to Congress served an av- events of Cantrell's life-changing day. The duous journey. Fortunately for Dayton, his ab- erage of 6 years. While unusual for this pe- family's contribution will be displayed in a spe- sence from the trip may have saved him from riod, as turnover in Congress was usually 50 cial case at a local library with other Spanish- a lengthy prison term as he was indicted for percent or more every election, this fact American War memorabilia. treason due to his perceived role in Burr's speaks to the stature and quality of these I ask you to join me today in honoring schemes. After spending a brief time in prison, men. For the average House Member or Sen- Cantrell's sacrifices and contributions to his he was released and spared the embarrass- ator, however, this was an era when serving country, as well as his family's. ment of a public trial. However, the attendant in Congress was generally done only for a f publicity brought an end to his national politi- short period of time. This was especially prev- cal career. Nevertheless, the people of New alent for southern members. One of the prin- IN RECOGNITION OF WORLD WAR Jersey still held him in high regard, and he cipal reasons for the relatively brief period of II VETERANS WHO SERVED AS went on to serve two terms in the New Jersey service during this time was the enormous COMBAT ARTISTS General Assembly beginning in 1814. He died burdens placed on Members of Congress. De- in 1824 in the town of his birth, Elizabeth, pending on the occupation, a Member had to HON. LOUISE McINTOSH SLAUGHTER soon after hosting a visit from Lafayette. The neglect his farm or his business to serve in OF NEW YORK city of Dayton, OH was named for himÐnot Congress. Additionally, a Member's pay of $6 IN THE HOUSE OF REPRESENTATIVES for his political achievements, but because he per day was paltry even by the standards of Tuesday, June 27, 1995 was a member of a group of businessmen that the day, the pay was not increased until 1860. invested in the area in 1796Ðand closer to Nevertheless, prominent men like Boudinot, Ms. SLAUGHTER. Mr. Speaker, I rise today my home, a regional high school in Springfield Dayton, and Clark did choose to serve, prob- to pay tribute to the World War II veterans was named in his honor. ably out of a mix of devotion to their country, who served as combat artists. The art collec- Serving with Senator Dayton in the Sixth and the opportunity to enhance their reputa- tions of the Army, Navy, Air Force, Marines, and Seventh Congresses was Aaron Ogden of tion and stature back home. and Coast Guard provide a pictorial memory Elizabeth. Senator Ogden, a Federalist, was Mr. Speaker, Union County is extremely using the medium of fine art to record the mili- elected to fill the vacancy caused by the res- proud of its sons that it sent to Congress dur- tary heritage of America and to provide in- ignation of James Schureman, who left the ing this early period in our Nation's history. sights into the experiences of individual mem- Senate to become the mayor of his home- Union County is full of interesting history that bers of the Armed Forces. Regardless of serv- town, New Brunswick. Born in 1756, Senator can easily be relived by visiting the preserved ice affiliation, the World War II combat artist Ogden was educated at Princeton University homes of some of New Jersey's famous Con- was assigned to document events of military and served with great valor in the Revolution- gressman or Senators. For example, the pub- importance. These included frontline battles, ary Army, attaining the rank of brigade major. lic is welcome to visit Boxwood Hall in Eliza- combat service support, areas of operations, After the Revolution, Senator Ogden became beth, home of Representative Boudinot and and incidents in the daily lives of military men an outstanding lawyer and leader of the Fed- Senator Dayton, or the Abraham Clark House and women. Their paintings and drawings are E 1340 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 varied in personal interpretation, but are alike most effective tools available to older Ameri- This program helps make the legal system in their portrayal of the reality of war. cans to ensure their own financial standing. accessible to many young people in my dis- The Department of Defense 50th Anniver- I strongly support the HECM program. Last trict. In doing so, the Miliken Legal Club teach- sary of World War II Commemoration Commit- year I cosponsored the HECM expansion and es these students that they have an invest- tee is honoring the combat artists from World extension provisions included in last year's ment in the law, in the justice system and in War II with an exhibition opening Friday, June housing bill, which the Senate failed to act on this Nation. I am proud to have this fine orga- 30, 1995 at the National Building Museum in at the close of the last session. nization located in my district. Washington, DC. The artists whose works will The HECM program is still in its infancyÐ f be displayed are: currently, banks only underwrite on average From the Army: Leslie Anderson, Bernard 200 to 400 loans HECM loans per month. This TRIBUTE TO JACK DRISCOLL Arnest, Howard D. Becker, Howard Brodie, all the more reason to support this worthwhile Manuel Bromberg, James D. Brooks, William effort, to give the private sector time to edu- HON. HOWARD L. BERMAN V. Caldwell, Harry A. Davis, Harry Dix, Frank cate itself and adjust to this valuable program. OF CALIFORNIA Duncan, Olin Dows, Loren Fisher, Jean The legislation I am introducing extends the IN THE HOUSE OF REPRESENTATIVES Flannigan, Albert Gold, Robert Gottsegen, authorization for an additional 5 years. This bill Tuesday, June 27, 1995 Robert MacDonald Graham Jr., Robert also extends the provisions of HECM to cover Mr. BERMAN. Mr. Speaker, I am honored to Greenhalgh, Hans Helweg, Richard H. Jan- 1 to 4 family units in which the owner resides. pay tribute to Jack Driscoll, who is recipient of sen, Steven R. Kidd, Wayne Larabee, David This is precisely the kind of role FHA has the 1995 Distinguished Public Service Award Lax, Ludwig Mactarian, Hans Mangelsdorf, served well in the past and should continue to given by the Anti-Defamation League, South- Barse Miller, James Neace, Charles Peterson, serve into the future: Creating a market for west Division. The award reflects Jack's many John Pike, Savo Radulovic, Edward Reep, Ju- valuable financing products and, after they are outstanding contributions to the city of Los An- lian Ritter, John A. Ruge, Edward Sallenback, established, moving out to let the private sec- tor operate those products more efficiently. geles. John Scott, Sidney Simon, Mitchell Siporin, Jack is best known as the executive director Samuel D. Smith, Harrison Standley, Joseph By creating a market for reverse mortgages, the HECM program provides unique opportuni- of the Los Angeles Department of Airports, a Steffanelli, A. Brockie Stevenson, Ann B. position he has held since December 1992. In Tilson, Frede Vidar, Rudolph C. Von Ripper, ties for older Americans to hold onto their houses throughout their lifetime and avoid this role Jack oversees the operations of Los John A. Wittebrood, and Milford Zornes. Angeles and Ontario International Airports, From the Navy: Standish Backus, Jr., Grif- being house poor, a sad result for those Palmdale Regional Airport, and Van Nuys Air- fith Bailey Coale, William Franklin Draper, Americans who have worked long and hard to port. This position has given Jack tremendous Mitchell Jamieson, Edward Millman, Albert K. keep their house but find, later in life, that they influence in local and regional affairs, and Murray, Alexander P. Russo, and Dwight C. cannot afford to live without selling their home. made him one of the key players in the eco- Shepler. The program also makes sense from a nomic revitalization of southern California. It is From the Air Force: Richard Wood Baldwin, budget standpoint. It is a net inflow to the FHA also the culmination of a successful 28-year Charles Baskerville, Edward Brodney, R. insurance fund of between $1.5 and $4 million career in municipal government. Munsell Chambers, G. Frederick Cole, Almer a year. Currently, lenders in 47 States, the District Prior to assuming his duties with the Depart- F. Howard, John Lavalle, Clayton Knight, Rob- of Columbia, and Puerto Rico are originating ment of Airports, Jack was general manager ert Laessig, Jack Levine, Milton Marx, John T. HECM loans. of the city of Los Angeles Personnel Depart- McCoy, Jr., Arthur G. Murphy, Oke G. The average HECM borrower is 76 years ment. He arrived in Los Angeles in 1978, after Nordgren, George Edward Porter, Arthur S. old and has a home value of $138,000, but an serving in various capacities in the mayor's of- Rothenberg, James Powell Scott, Maltby income of only $10,400. By contrast, the me- fice in Seattle. Sykes, and William Peter Welsh. dian senior's income in the United States Jack has a bachelor's degree in psychology, From the Marines: Paul Arlt, John today is $18,500 and the median home value a master's in business administration from the Degrasse, Donald Dickson, Vic Donahue, is only $70,400. University of Seattle, and is a graduate of the James Donovan, Tom Dunn, John Fabion, We should encourage, not punish those UCLA Graduate School of Management, Ex- Richard Gibney, Victor Guinness, Harry Jack- who want to stay in their houses and stay in ecutive Program. In addition, he is a member son, Walter Anthony Jones, Woodrow A. the neighborhoods they care about and at the of the American Association of Airport Execu- Kessler, Hugh Laidman, John McDermott, and same time make their life more livable. What tives and the government affairs committee of Charles Waterhouse. could be better than ensuring the quality of life Airports Council International-North America. From the Coast Guard: Gare Antresian, of older Americans at no additional cost to the Mr. Speaker, I ask my colleagues to join me Tom Asplundt, Peter Cook, Robert Daley, Government? in saluting Jack Driscoll, a public servant who Ralph DeBurgos, Russell Dickerson, Joseph f works tirelessly for the betterment of his com- DiGemma, Di Valentine, Max Dorothy, Bruno munity. He is a shining example to us all. Figallo, Anton Otto Fischer, John Floherty, IN RECOGNITION OF THE MILIKEN f Jack Gildersleeve, John Gretzer, Sherman LEGAL CLUB OF THE BOYS CLUB Groenske, Lawrence Jenson, Jack Keeler, OF NEW YORK THE FUTURE OF THE REPUBLIC Sandor Klein, Joe Lane, Leonardo Mariani, OF KOSOVA Kenneth Miller, John Morris, John B. Norall, HON. JERROLD NADLER Ken Riley, Richard Saar, Michael Senich, Nor- OF NEW YORK HON. ELIOT L. ENGEL man Thomas, Robert Tucker, Ronald Ullman, IN THE HOUSE OF REPRESENTATIVES OF NEW YORK H.B. Vestal, John Wisinki, and Hunter Wood. Tuesday, June 27, 1995 IN THE HOUSE OF REPRESENTATIVES America is grateful for this powerful leg- acyÐrich in its emotional contextÐand is Mr. NADLER. Mr. Speaker, I rise today to Tuesday, June 27, 1995 proud to recognize these artists who served recognize the Miliken Legal Club of the Boys Mr. ENGEL. Mr. Speaker, Dr. Bujar their country during World War II. Club of New York. The Miliken Legal Club was Bukoshi, Prime Minister of the Republic of f founded in 1992 by Dr. Shirley Smith. This Kosova, recently gave an important address to program provides an active legal education for the European Parliament in Strasbourg, HOME EQUITY CONVERSION high school age students. During the school France. MORTGAGES year, young men and women are instructed in In his speech, Dr. Bukoshi spoke eloquently legal procedure by lawyers such as Larry about his homeland and the people of Kosova. HON. RICK LAZIO Carbone of the New York City Con. Ed. Legal While lamenting the past, including the num- OF NEW YORK Department and by Ellen Van Dyke of the ber of Kosovars who have been killed, wound- IN THE HOUSE OF REPRESENTATIVES Manhattan district attorney's office. When ed, arrested, tortured, and otherwise subjected summer arrives, several students are chosen to inhumane treatment, Dr. Bukoshi gave rea- Tuesday, June 27, 1995 to act as interns at the Manhattan district at- son for hope in the future by laying out his vi- Mr. LAZIO of New York. Mr. Speaker, today torney's office. The program culminates each sion for protecting Kosova from further injus- I offered a bill reauthorizing the Federal Hous- year with a mock trial that is presided over by tice. ing Administration's ability to insure home eq- Bronx Supreme Court Justice Richard Lee I urge my colleagues and members of the uity conversion mortgages [HECM], one of the Price. European Union to strongly consider Dr. June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1341 Bukoshi's positive, forward-looking solutions been firm, we have established a functioning A handful of then-CSCE observers were as the United States and Europe consider how government and economy, we have held to- posted in Kosova until July 1993 when Bel- to proceed in the former Yugoslavia. gether in solidarity with one another. We grade expelled the delegations. Although few The text of the speech follows: have demonstrated incredible patience, re- in number, the monitors served the purpose straint, and judgment in the face of daily of at least chronicling the cases of human Ladies and gentlemen, it is an Honor for brutality, harassment and intimidation. right abuses across Kosova. Since their de- me to have been given the opportunity to ad- Numerous delegations have visited Kosova parture, incidence of violence, beating, plun- dress an important audience that is actively and have witnessed the appalling situation. dering and murder has escalated dramati- seeking to identify conflict situations and They have visited the storefront clinics, spo- cally. prevent them before they become unmanage- ken with patients, listening to the doctors. able. In this context, let me congratulate Fifth: Support mediated dialog with the They have witnessed the classrooms in you on the good task you have started, in Serbs in the presence of international medi- homes where thousands of Albanian students the hope that the FORUM will have its im- ator. are doing their best to preserve their edu- pact in breathing a sense of reality into the We have repeatedly offered to meet with cation, and they have reported on massive asphyxiated, and crisis-ridden international the Serbs to discuss our difference without violations of human civil and national rights fora. preconditions except one: an international Let me begin by quoting one of the great- of the Albanians. mediator must be present in the talks. We est Albanian writers, Ismajl Kadare, who has Also many delegations from Kosova, in- are prepared to meet anywhere at anytime on one occasion stated: ‘‘The word ‘Kosova’ cluding the leadership of Kosova have re- to talk about our differences and sincerely is spoken always with hesitation, in a low peatedly informed governments of western try to resolve them. democratic countries and the general public voice, almost in a whisper—the way ancient Sixth: Reactivate the Kosova Group of the about the ever deteriorating situation that people spoke some words in a low voice when International Conference on Former Yugo- can lead to a conflict with unpredictable they talked of ‘evil spirits’ ’’. slavia. consequences. Although hesitantly, Kosova is always The Working Group which was established mentioned whenever there are evident signs In parliaments around the world, legisla- in London in August 1992 and which has been of the escalation of the former Yugoslav cri- tors have spoken with resolutions of support. moribund ever since, has achieved absolutely sis, and always in the context of a wider Bal- For illustration, let me mention that the Eu- nothing. Now is the time to breathe new life kan conflict. In the case of the last esca- ropean Parliament has condemned repres- into the process and create a new mechanism lation in Bosnia involving UN hostages sion against the Albanian population in to begin the task of fulfilling the legitimate taken by Serbian forces, a clear act of inter- eight resolutions. At the same time Alba- rights of the Albanians to life, liberty and national terrorism, western leaders have nians have been praised for their peaceful re- self-determination. pointed out again the possibility of a wider straint. Balkan war rightly stressing that such a war Yet, the situation has only kept worsening Seventh: UN get involved for the restora- would firstly encompass Kosova, then Mac- while repression continues. tion of democratic institutions to Kosova. edonia, in order to include Albania, Bulgaria, The international community cannot con- This would prove to be a powerful deterrent Greece and possibly Turkey. tinue to ignore the untenable situation in of conflict and, therefore, instill hopes of a Just 200 kilometers southeast of Sarajevo Kosova. return to normality in Kosova. lies the Republic of Kosova, in danger of be- As much as we are determined to remain Events of the last months demonstrate coming another Bosnia, but even worse. The patient, no one can guarantee that the Alba- that a new reality is setting in among those Balkans imbroglio suggests that Kosova may nians can sit idly by for decades, watching concerned with the Balkans. We firmly be- be next in the succession of victims in the their personal and collective resources dis- lieve that until the world deals with the face of Serbian ethnic cleansing and oppres- appear while their families and friends are major cause of the aggression, the problem sion. subjected to barbaric treatment by cruel and will fester, the bloodshed will continue, and Kosova with its 90-percent Albanian popu- inhuman occupying forces. there will be no place in the Balkans. lation is already a Serbian victim. Kosova To avert this calamity the European Union The current Yugoslav crisis is not the re- lost its autonomy six years ago, when Ser- and the international community must be- sult of an abrupt decision of its peoples to bia, unconstitutionally and by use of police come engaged in helping solve the Kosova part company. It is the realization of the and military forces, abolished the Par- part of the Balkans problem. We need their right of peoples to self-determination; it is a liament of Kosova, dismissed the govern- involvement in the following ways: free expression of their national identities, First: While talks on the future of Kosova ment and its administration, and closed hitherto suppressed by Serbian hegemonism. remain an uncertain reality, it is necessary down television, radio and the daily Alba- In this context, the independence which we that preventive forces be deployed to nian-language newspaper. Systematic struc- have proclaimed for Kosova, and we are Kosova. Since Kosova presents a threat to tural repression against the Albanians of pursing to institute, is but an adaptation to regional peace and stability, the UN Secu- Kosova, enacted martial law, has reached political realities and moderate approach to rity council should declare Kosova a safe tragic proportions each passing year. our goals. Serbian apartheid manifests itself in dis- area in the meaning of Chapter VII of the UN In conclusion, let me point out the Kosova crimination that started with rigged politi- Charter. issue has been wrongly ignored until now. cal trials before civil and military courts; Second: NATO must prepare contingency Whether this has been done because of the isolation and confinement of hundreds of in- plans for intervention in Kosova in the worst Serbian Myth, was place in the service of ag- tellectuals, scientists and economic experts; possible scenario. Its credibility can only be gression, or because of the ‘evil spirits’, inac- massive prison sentencing of Albanians, restored if, as Manfred Worner has said, ‘‘it tion in Kosova may prove costly. There is killings of peaceful demonstrators; expulsion is ready to punish the aggressor if necessary still time to save Kosova, and we still believe of hundreds of university professors, thou- and also consider using force to achieve po- in peace, therefore we have not resorted to sands of teachers and administrators; dismis- litical and diplomatic solutions’’. violent means. However, if it comes to con- sal of physicians and medical staffs and the Third: Keep sanctions in place and increase flict, for which Kosova Albanians can never complete abrogation of all human, civil and international pressure to Serbia. be blamed, they have no other option but to national rights. Recent attempts to force Serbia to recog- Our plight has been documented by Am- nize the borders of Bosnia, a bargain for lift- defend themselves. nesty International, the United Nations Spe- ing of sanctions, is a doomed effort not only Bad Judgments of the past must not be re- cial Rapporteur, CSCE, and other human because of the request that a non-entity ac- peated. It is time for courageous leadership rights bodies and international organiza- cepts what is now already a UN member. and commitment to principle, southeast of tions. [The] Belgrade regime may be forced to ac- Sarajevo and throughout the Balkans. In the first quarter of 1995, more than 3,000 cept this demand, which will most probably f Albanians were subjected to all forms of mis- be another Serbian farce, but nothing will treatment by the Serbs. Two were shot dead; change on the ground and the peoples of ELECTIONS IN HAITI seven wounded; 34 were convicted; 125 were former Yugoslavia will not find themselves subjected to arms searches and harassment; closer to an acceptable solution. Although 1,157 were arrested; 985 tortured; 973 families sanctions were introduced because of the HON. LEE H. HAMILTON subjected to weapons raids; 589 summoned Serbian active role in the war, they should for police interrogation; 204 suffered political never be lifted before a global solution of the OF INDIANA persecution; 114 youth were punished for not former Yugoslavia crisis is achieved. (In this IN THE HOUSE OF REPRESENTATIVES joining the Serbian army; 8 were convicted regard, we welcome the tough stance of EU by military courts; 9 Albanian families were Commissioner for Central and Eastern Eu- Tuesday, June 27, 1995 evicted from their apartments. The above rope, Mr. Hans van den Broek, that inter- Mr. HAMILTON. Mr. Speaker, yesterday I constitute only the most drastic forms of re- national sanctions should be linked to a so- received the following statement from the pression. It should also be noted that many lution of the Kosova issue.) cases are never reported. Fourth: Immediately return a long-term, Presidential delegation to the June 25, 1995, Thus far, Kosova has reacted to this re- expanded OSCE monitoring mission to Haitian elections. pression with peaceful resistance. We have Kosova. The text of the correspondence follows: E 1342 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 DEPARTURE STATEMENT, UNITED STATES assisting the electoral process. In this con- an amendment to the Energy and Water Ap- PRESIDENTIAL DELEGATION TO OBSERVE THE text, we note the very positive role that the propriations bill that would require Secretary HAITI ELECTIONS United Nations Mission played in Haiti dur- O'Leary to report to Congress every time the JUNE 26, 1995, PORT-AU-PRINCE, HAITI ing the entire transition period. Despite the problems associated with the Secretary authorized the payment of travel ex- Yesterday’s elections represent a step in pre-election period and observed on election penditures in excess of the amount appro- the building of democracy in Haiti. A peace- day, the Haitian people voted freely and priated for fiscal year 1996. ful balloting process occurred in a country seemingly without fear. Haiti is now one where violence has so often marked past [From the Los Angeles Times/Washington step closer to establishing a functioning par- elections. This feat is truly impressive when edition, June 26, 1995] liament and viable local government. O’LEARY: ENERGY SECRETARY LOGS CABINET’S one considers that but nine months ago Haiti It is our firm belief that further steps to HIGHEST TRAVEL COSTS was under the yoke of a military dictator- correct the identified problems will encour- ship. However, the process was affected by age a perception of fairness about this proc- (By Alan C. Miller and Dwight Morris) irregularities and administrative flaws that ess, despite the inevitable difficulties of con- WASHINGTON.—Energy Secretary Hazel need to be addressed for the second round ducting an election in Haiti. The Haitian O’Leary defends her department against and the future. people have demonstrated that they have budget-cutting proposals to dismantle it by Members of the presidential delegation vis- earned the respect associated with partici- portraying herself as a master economizer in ited five of Haiti’s nine departments and pating in the individual act of casting a bal- government—reducing her work force, boost- more than 300 polling sites. We observed a lot. For our part, we will continue to work ing efficiency and saving taxpayers’ money. complicated balloting procedure, involving with the government and people of Haiti in But when she hits the road in her job, as elections for more than 2100 legislative, may- supporting the strengthening of democratic she often does, O’Leary apparently is no bar- oral and local council offices. Dedicated poll- institutions in this country. gain hunter. ing officials and pollwatchers representing 25 political parties surmounted various obsta- f Traveling in a style that is unusual, if not unique, among her Cabinet colleagues, cles in allowing the Haitian people, in most PRODIGIOUS TRAVEL BY ENERGY localities, to choose their representatives. O’Leary is the jet-setter of the Clinton Ad- Procedural and administrative problems SECRETARY O’LEARY ministration. before and on election day, nonetheless, pre- On longer trips, the former corporate exec- vented citizens in several municipalities utive frequently upgrades her airline flights HON. MARTIN R. HOKE to business class or first class—and some- from expressing their voting preferences. OF OHIO The failure to include the names of certain times authorizes staff members accompany- IN THE HOUSE OF REPRESENTATIVES approved candidates on the ballots contrib- ing her to do so as well. And she routinely uted to the cancellation of elections in seven Tuesday, June 27, 1995 stays at expensive hotels, such as the Ritz- communities and created disquiet in other Carlton and the Four Seasons, in contrast Mr. HOKE. Mr. Speaker, as you may re- with more cost-conscious fellow Cabinet areas. We also have received critical reports member, 1 month ago I asked the General Ac- regarding the failure to follow proper proce- members. dures during the initial counting phase, with counting Office and the chairmen of the House The travel habits are apparent on the bills most serious consequences in the Depart- Commerce, House National Security, and for all trips, other than flights on military ment of the West, which covers the Port Au House Government Reform and Oversight or Energy Department aircraft, that she sub- Prince area. Committees to initiate investigations into the mits to the government. For her first two Despite repeated misunderstandings over Secretary of Energy's prodigious travel. years on the job, the median cost of the actions of election officials at all levels, I am happy to report that the General Ac- O’Leary’s 61 domestic official trips was 58% higher than it was for EPA Administrator the delegation saw little evidence of any ef- counting Office has initiated an investigation fort to favor a single political party or of an Carol Browner’s trips, 73% higher than for into Secretary O'Leary's travel. This is espe- travel by Housing Secretary Henry G. organized attempt to intentionally subvert cially important in light of the Monday, June the electoral machinery. At many points, Cisneros and 90% higher than Health and the Provisional Electoral Council’s actions 26, front page story in the Los Angeles Times Human Services Secretary Donna Shalala’s and public statements raised questions about reporting that Secretary O'Leary's travel ex- trips, according to travel documents ob- the credibility of the process. The most sig- penditures far exceed those of all other Cabi- tained under the Freedom of Information nificant of the problems was the failure to net officers. Act. explain the reasons candidates were rejected. When I made my May 25 statement about In a written response to questions, O’Leary Political parties raised these and other con- the Secretary's travel habits, I was under the said her travel costs and practices are en- cerns relating to the transparency of the tirely appropriate and that, in fact, she had impression that she had transferred $100,000 spent nearly $14,500 of her own money on of- elections in their contacts with the delega- from various program accounts to finance her tion. ficial travel. On most domestic flights, she President Aristide and his government per- travel. Imagine my surprise when it actually upgrades to business class at no cost to the formed a positive role in repeating often the turned out that Secretary O'Leary had trans- government, even though she is on duty 24 theme of reconciliation. In meeting with ferred in excess of $400,000 from other ac- hours a day and does considerable work en some rejected candidates and in a public counts, including accounts used by scientists route, a spokeswoman said. statement on the eve of the elections, the and technicians in the Department's nuclear ‘‘Secretary O’Leary is an activist secretary President demonstrated his concern over the safeguards and security program, to pay for who believes that most of the work of the controversies surrounding the process and her globe-trotting. government is beyond the Beltway,’’ said Barbara Semedo, the Energy Department’s underscored his desire to be President of According to the L.A. Times, Secretary every Haitian citizen. press secretary. ‘‘She is responsible for su- We wish to emphasize that this electoral O'Leary believes in traveling first class all the pervising a nationwide network of sites, process is far from over and thus a definitive way, spending approximately $815 per trip for many of which are former nuclear weapons evaluation is premature. The counting of a total of nearly $50,000 on her domestic trav- facilities located in remote areas of the ballots and the adjudication of electoral els. But that does not include the costs associ- western United States, where transportation complaints are pending. There may even be a ated with her entourage that has included as is sometimes time-consuming and expen- need to rerun elections in certain jurisdic- many as 10 staff members. I ask unanimous sive.’’ tions. We will remain in close contact with consent that the Los Angeles Times article be Two practices in particular put O’Leary at other observer delegations, most notably the the top of the travel-expense list. The gov- inserted in the CONGRESSIONAL RECORD after Organization of American States, which has ernment has ceilings on the amount it will organized coverage of these elections my statement. repay officials for meals and accommoda- throughout the country. I now understand that Secretary O'Leary tions but citing special circumstances, A determined effort is required to remedy has demanded that DOE program offices O’Leary routinely seeks hotel reimburse- the most significant problems affecting the cough up additional funds for her planned ment at as much as 150% of the maximum electoral process before the next round of boondoggle to South Africa. I suppose that a level. Other Cabinet members usually find elections. Sincere consultations with a broad safari to South Africa would be grand this time lodging for considerably less. range of political parties and transparent de- of the year, but I cannot believe that this trip And most other agency heads rarely, if cisionmaking by the electoral authorities is more important than safeguarding our nu- ever, upgrade from coach class on commer- should have occurred and are indispensable clear deterrent. As I have said before, the De- cial flights. to strengthening Haiti’s democratic institu- The figures cited for O’Leary do not reflect tions. The government also should consider partment of Energy seems to have become one additional area in which the Energy De- carefully the recommendations of the United nothing more than a travel service to satisfy partment outspends other agencies: travel by Nations, various observer delegations and the Secretary's wanderlust. staff members. The energy secretary usually technical election experts who have worked For that reason and in order to gain a han- takes a larger retinue of aides with her on closely with their Haitian counterparts in dle on DOE travel expenditures, I plan to offer trips than do her Cabinet colleagues. June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1343 O’Leary, 58, a lawyer, oversees a $17.5-bil- charge to the government for the secretary Chief of Staff Richard H. Rosenzweig was lion agency and one of the largest federal bu- was $3,198, and the added amount for the reimbursed for three nights at $125 a night reaucracies, with 17,000 federal employees three aides was $7,067. and the daily per diem of $34. Johannah M. and another 140,000 who work for the govern- The lodging choices of O’Leary and her Dottori, O’Leary’s director of scheduling and ment through contracts with private compa- Cabinet colleagues are also a study in con- logistics, put in for the full resort rate of nies. Its responsibilities include cleaning up trasts. $257 for two nights and per diem for two thousands of sites that were radio-actively When Browner traveled to Boston in late days. Both sought the higher ceiling on their contaminated through the nation’s nuclear 1994 for the EPA, she stayed at the Charles lodging because of ‘‘extraordinary expenses weapon program. Hotel on Harvard Square at a cost of $83 a associated with accompanying the sec- O’Leary was executive vice president for night. O’Leary stayed at the Four Seasons retary,’’ according to their travel records. corporate affairs at Northern States Power for $335 a night when she flew to Boston in Even so, Dottori exceeded the 150% limit Co., a gas and electric utility based in November, 1993. by approximately $100. Semedo said Friday Minnapolis, before Clinton made her the first When Reich went to New York for the that this was ‘‘an oversight’’ by department woman and first African American to head Labor Department in April, 1993, he stayed auditors and that Dottori will probably have the Energy Department. A multimillionaire, at the Sheraton Manhattan for $125. Three to reimburse the government for the exces- her annual salary is now $148,400. weeks later. O’Leary flew to Manhattan and sive charge. She won early plaudits for revealing infor- checked into the Ritz-Carlton for $195. During the cross-country flight, Semedo Federal travel regulations permit officials mation about government-sponsored atomic said O’Leary worked on official business and to seek approval to claim up to 150% of the experiments and has led high-profile over- consulted with her staff. Wherever O’Leary maximum per diem cost if one of the several seas trade missions to India, Pakistan and is, Semedo said, she spends ‘‘a major portion ‘‘special or unusual circumstances’’ applies. China, where U.S. energy firms signed deals of her time’’ on departmental matters. In Boston, O’Leary sought the higher rate in that the Energy Department said were worth Asked to explain why Rosenzweig and her travel authorization because she re- at least $19.2 billion. Dottori were reimbursed for their expenses, quired lodging close to where she was sched- While battling Republican-led efforts to the department cited a 1990 White House uled to appear. She also did so in New York, eliminate her department in recent months, memorandum which said, in part, that travel citing high costs and her schedule. O’Leary has announced plans to close offices The government maximum for New York can be charged to the government for indi- and reduce staff, as well as cut back on over- accommodations is $140, or $210 at the higher viduals ‘‘whose official duties require them all department travel. reimbursement level. In Boston, however, to be with a Cabinet member, whether or not An extensive review by The Times of the even at the higher reimbursement rate, the the Cabinet member himself is on official travel itineraries and vouchers of eight sen- secretary was able to put in for only $171 for business.’’ ior Clinton officials found that O’Leary’s lodging. O’Leary paid the balance herself. The two aides accompanied O’Leary ‘‘to travel habits stood out. The median cost of Overall, O’Leary billed the government for perform official functions, including prepara- her trips, which means that half her trips expenses that exceeded the maximum stand- tion for upcoming work, policy discussions cost more and half less, was $671. The median ard reimbursement rate on 61 of the 71 occa- and providing a communications link to the duration of the trips was three days. sions when she stayed at a hotel in the Unit- department headquarters,’’ Semedo said. Among those surveyed, only Veterans Af- ed States, records show. Other agency heads ‘‘They did not take part’’ in partisan activi- fairs Secretary Jesse Brown recorded similar took advantage of the higher cap far less ties. costs. His traveling style is not comparable often. f to O’Leary’s, but he tends to take longer O’Leary is usually joined by seven or more trips. aides on foreign trips and by several aids on FLAG AMENDMENT IS THE The figures for O’Leary and her counter- domestic journeys, through that number has PEOPLE’S WILL parts appear low, in part because they in- been as high as 10 on occasion. She almost clude inexpensive trips, some of which in- always travels with her director of schedul- volved only ground transportation and no ing and logistics and a security officer, HON. GERALD B.H. SOLOMON overnight stays. In other cases, political Semedo said. Other staff members ‘‘may be OF NEW YORK campaign committees picked up some of the assigned if their expertise is needed’’ in such IN THE HOUSE OF REPRESENTATIVES tab if the trip entailed a political appear- matters as nuclear weapons cleanup or inter- Tuesday, June 27, 1995 ance. national trade, she added. Moreover, government officials can be re- By comparison, Cisneros traveled alone on Mr. SOLOMON. Mr. Speaker, I would like to imbursed no more than a certain amount for a quarter of his domestic trips, with one aide draw your attention to the comments of one of meals and lodging, with those maximums de- on nearly half of his trips and with as many our colleagues in the House, the gentleman termined on a city-by-city basis. In addition, of four staff members only once. U.S. Trade hotels and airlines often offer discount rates from Louisiana, Mr. JEFFERSON. His column Representative Mickey Kantor traveled entitled, ``Flag Amendment Is the People's to government workers. alone or with one aide on two-thirds of his Overall, O’Leary spent $49,857 on her 61 do- trips that included domestic destinations Will'' was published in the recent edition of the mestic trips, a figure that does not include and with no more than five on any trip. American Legion Magazine in support of the travel by her aides. ‘‘I don’t travel with a large number of constitutional amendment protecting our flag. That amount was $11,088 less than aides because I usually spend my travel time As you know, Mr. Speaker, this constitutional Cisneros’ cumulative cost, although he took catching up on important reading that I amendment will be coming before us on the nearly twice as many trips. Labor Secretary can’t get to in the office, or sketching out floor this Wednesday, June 28. I would ask all Robert B. Reich took only three fewer trips ideas,’’ Cisneros said. ‘‘Likewise, I find coach my fellow Members to heed Mr. JEFFERSON's than O’Leary but charged taxpayers slightly seating very satisfactory for my needs.’’ more than half as much. One O’Leary destination had nothing to do sound advice and keep faith with the Amer- The seven times that O’Leary upgraded to with official Energy Department business. ican people by supporting this constitutional business class or first class at public expense In February, 1994, the secretary and two amendment and sending it to the States and were generally on overseas or cross-country staff members traveled from Los Angeles to the people for ratification. trips. She cited on her travel vouchers that Boca Raton, Fla., where she participated in a [From the American Legion] she needed to do so to perform work during weekend conference of the Democratic Na- FLAG AMENDMENT IS THE PEOPLE’S WILL the flight, to arrive at her destination fresh tional Committee’s Business Leadership enough to conduct business and because of Forum, a group of corporate executives who (By Representative William Jefferson) periodic back spasms. Federal travel regula- each gave at least $10,000 to the Democratic In April, a proposed constitutional amend- tions require such justifications for flying Party. ment that would permit the individual states via any class other than coach. During her stay at the Boca Raton Resort to enact legislation banning physical dese- On other trips, Semedo said O’Leary up- & Club, O’Leary’s schedule consisted pri- cration of the flag was introduced in the graded by using frequent-flier miles accumu- marily of attending a Democratic leadership Congress. lated before she came to the Energy Depart- forum lunch and dinner, as well as rec- After much careful deliberation, I became ment or by paying the difference herself. reational and personal appointments. an original cosponsor of the amendment. My The spokeswoman said O’Leary considers O’Leary did not seek reimbursement from decision came not without considerable an- it cost-effective for aides to upgrade so they the government for any of her expenses in guish, particularly over the principle of can work with her in flight. Unless otherwise Boca Raton. The Democratic National Com- amending the Constitution. necessary, just a single seat is upgraded, mittee repaid the Energy Department for the In the final analysis, however, it came with staff members moving back and forth added cost of her flight from Los Angeles, down to this: If we are not willing to stand from coach class to consult with the sec- where she had gone on government business. up for our flag, what will we stand up for? retary. But the two staff members who accom- To those who say this is a First Amend- But the practice can multiply the cost. panied her did bill taxpayers for their flights ment issue—an issue of free speech—let me During an October, 1993, flight from Chicago to and from Florida and for some of their ex- remind them that there are several restric- to London, three staff members upgraded to penses during their midwinter stay at the tions and limits on speech already. One can- business class with O’Leary. The additional oceanfront resort. not libel or slander another without fear of E 1344 CONGRESSIONAL RECORD — Extensions of Remarks June 27, 1995 legal retribution. One cannot advocate the SAN YSIDRO NEIGHBORHOOD As an alumnus of Yale, I am aware of the assassination of the President without the HISTORY DAY significant contributions to national defense Secret Service becoming extremely inter- made through the years by members of the ested in his or her speech. As Supreme Court Yale community—including in some in- Justice Felix Frankfurter pointed out so elo- HON. BOB FILNER stances, the sacrifice of their lives. The ef- quently many years ago, our right to free OF CALIFORNIA forts of those advocating, or supporting, the speech does not extend to yelling ‘‘Fire!’’ in IN THE HOUSE OF REPRESENTATIVES ban of ROTC units on the campus are an ob- a crowded theater. No, this is not a free scenity in the face of those contributions. speech issue. Rather, it is a matter of per- Tuesday, June 27, 1995 Please continue your efforts. sonal responsibility. Mr. FILNER. Mr. Speaker, I rise today to Sincerely, Surely, desecrating a U.S. Flag—burning a honor the community of San Ysidro in recogni- JOSEPH F. CALLO, flag—is abhorred by society, and our society tion of San Ysidro Neighborhood History Day. Rear Admiral, USNR (Ret). has the right to demand that such activity Its official name, ``San Ysidro,'' was given in f be punished. Reflecting that sentiment, my home state of Louisiana in 1991 was the 21st 1909 by a group of people who came to live CONGRATULATIONS TO DR. of 49 states so far to pass a resolution urging in the valley and founded a small agricultural DONALD E. JARNAGIN Congress to approve a flag-protection colony named after Saint IsidroÐthe patron amendment. saint of field laborers and agriculture. Amending the Constitution is no simple In 1957, San Ysidro was incorporated to the HON. BOB STUMP undertaking. The Founding Fathers intended city of San Diego. Today, in 1995, because it OF ARIZONA it to be that way. Two-thirds of the House is California and San Deigo's gateway to Mex- IN THE HOUSE OF REPRESENTATIVES (290 Members) and Senate (67) must agree to ico and Latin America, San Ysidro plays a Tuesday, June 27, 1995 pass the legislation, then three-fourths of major role in the development of San Diego. the states—36—must ratify the amendment Mr. STUMP. Mr. Speaker, it is a pleasure The success of this unique community is an within seven years. for me to recognize that a good friend and fel- example of what happens when people take Throughout our history, constitutional low native Arizonan, Dr. Donald E. Jarnagin, pride in their neighborhoodÐa community amendments have proved the only path for of Glendale, Arizona, is being inducted as the made up of friends and families that work hard redress of serious societal ills in our country. 74th President of the American Optometric As- Women’s suffrage, for example, was accom- every day for the betterment of the residents sociation today by his colleagues at their 98th plished through a constitutional amend- and especially the children. Annual Congress in Nashville, Tennessee. ment, as was the abolition of slavery after San Ysidro Neighborhood History Day was Don's accomplishment are most impressive the Civil War. The Fourteenth Amendment celebrated with exhibits about the history of and extend past his field of optometry. He is recognized former slaves as citizens and the San Ysidro, the unveiling of murals by the chil- Fifteenth gave them the right to vote. No a graduate of Southern California College of dren of San Ysidro, and a theatrical perform- one could deny that these amendments—con- Optometry in Fullerton, California, and has ance. I have been working with the community troversial as they were at the time—made held numerous elective and appointed posi- of San Ysidro since my days on the San our society better. tions in his professional career. Prior to first Diego City Council to help the community fos- This proposed amendment and the need of being elected to the American Optometric As- ter pride in its diversity and culture. I was its passage grew from a 1989 Supreme Court sociation Board of Trustees in 1987, Don decision, Texas v. Johnson. The court nar- proud to participate with the community in rec- served as the Central Arizona Optometric So- rowly ruled, 5–4, that burning an American ognizing San Ysidro Neighborhood History ciety's President and then went on to become Flag was ‘‘protected’’ as free speech. The Day. case arose following a demonstration at the President of the Arizona Optometric Associa- Republican National Convention in Dallas in f tion. 1984. Gregory Johnson and a group of fellow LETTER IN RESPONSE TO THE Active in his community, Don is a former protesters burned a flag outside the conven- POMBO-SOLOMON AMENDMENT president of the Glendale Rotary Club and has tion hall as part of their protest. Texas au- been appointed a member of the City of Glen- thorities convicted Johnson of flag desecra- dale Charter Review Committee. He chaired tion under existing Texas law. The Supreme HON. GERALD B.H. SOLOMON Court decision overturned not only the the City of Glendale Housing Authority and OF NEW YORK Texas law, but also flag-protection statutes has also been active in the Glendale Chamber in 47 other states and the District of Colum- IN THE HOUSE OF REPRESENTATIVES of Commerce. bia. Tuesday, June 27, 1995 I am pleased to join Don's family, many The American public was outraged then friends and colleagues in congratulating him Mr. SOLOMON. Mr. Speaker, I would like to and continues to be outraged today. Public- on his induction today. From his many years bring to your attention a letter I received in re- opinion polls show that more than 80 percent of friendship and counsel, I know that he will sponse to the Pombo-Solomon amendment of all Americans favor protection of the flag. be an outstanding AOA President, and will do which passed overwhelmingly in the House Following the 1989 Supreme Court decision a great job in leading the Association in its ef- and a similar 5–4 decision in 1990 in another last week. The letter, in support of the amend- forts to improve our Nation's vision care. flag desecration case, three out of four ment, is from Rear Adm. Joseph F. Callo, a Americans believed the only way to protect Yale University alumnus. f the flag was through a constitutional amend- JUNE 14, 1995. ment. IMPORTANT NEWS ON THE DRUG Hon. GERALD B.H. SOLOMON, ISSUES Nearly 40 years ago in the hot summer of House of Representatives, 1957, Dr. Martin Luther King was beginning Washington, DC. his dream of equality for all Americans. At a DEAR CONGRESSMAN SOLOMON: I support HON. GERALD B.H. SOLOMON citizenship education program that summer, your efforts to block all federal financial aid King said there was glory in citizenship, and OF NEW YORK to schools that deny ROTC on campus. IN THE HOUSE OF REPRESENTATIVES that we don’t want haters. Our country, he The intellectual dishonesty of the campus said, may not be all we want it to be, but groups that argue for the ban of ROTC, and Tuesday, June 27, 1995 that would change. other military activities on campus, is ap- Mr. SOLOMON. Mr. Speaker, I would like to Respect your country; honor its flag. palling. I am also deeply saddened by a fac- We have come a long way as a nation since ulty and administration that supports those share with you some important news on the 1957. Dr. King’s dream still lives—the Amer- efforts. My distress is heightened by the fol- drug issue. In April of this year, the U.S. Sen- ican dream persists. In the words of Charles lowing: tencing Commission recommended that Con- Evan Hughes, the 11th Chief Justice of the As an undergraduate at Yale, I learned the gress end the sentencing disparity between U.S. Supreme Court, ‘‘This flag means more importance of objectivity, intellectual con- powder cocaine and crack cocaine. Congress than association and reward. It is the symbol sistency and rationality. Each of these quali- ought to ignore this politically correct sugges- of our national unity.’’ ties has been trampled by those pursuing, or tion and reaffirm its well-considered position It is now our time to do our patriotic duty, supporting, the anti-ROTC efforts. that offenses involving crack cocaine deserve to keep faith with the American people who As a former NROTC student at Yale, I sent us to Washington. Passing this flag-pro- know first hand of the high academic quality more severe punishment than those involving tection amendment adds one more strand to of that program. powder cocaine. the fabric woven by preceding generations— As a taxpayer, I protest using my tax Under current Federal law, there is a 100:1 the fabric of freedom, symbolized by our money to support the students, administra- powder/crack ratio. That is, possession or dis- flag. tion and faculty involved in these efforts. tribution of 100 grams of powder is treated as June 27, 1995 CONGRESSIONAL RECORD — Extensions of Remarks E 1345 the equivalent of possession or distribution of Mr. Speaker, at this time I would submit into By law if Congress takes no action to stop one gram of crack for sentencing purposes. the CONGRESSIONAL RECORD a position paper it on November 1, 1995 it will take 100 times Therefore as the law currently stands, a first- on this subject drafted by Drug Watch Inter- as much crack in an offense to get the same national. sentence as today. The Sentencing Commis- time offender involved with one gram of crack sion recommendation will pass automati- would receive the same 5-year mandatory ALERT, JUNE 1995 cally. That is the way Congress set it up. minimum sentence as another first-time of- A massive federal decriminalization of the Therefore, no one will be on the record favor- fender arrested for an offense involving 100 most dangerous drug destroying our commu- ing a massive decriminalization. It will just grams of powder cocaine. nities and feeding the wave of inner-city vio- sneak on through and become law. lence is poised to become law! And it will Effective investigation and prosecution of The Sentencing Commission recommends happen automatically on November 1, 1995, organized gang crimes invariably requires that Congress rewrite the law and treat crack unless Congress stops it. and powder cocaine on an equal basis. Evi- Crack dealing, even in large amounts, is the undercover assistance and later trial tes- about to be 99 percent decriminalized. timony of gang members who have access to dently, some members believe that there is no the gang’s leadership and knowledge of the reason for the disparity. In my opinion, Con- The greatest weapon used by federal pros- ecutors to protect urban, inner-city commu- gang’s inner workings. Such key gang insid- gress in the 1980's reacted properly to the nities from gangs and gang violence will be ers only agree to cooperate with agents and crack epidemic gripping vulnerable innercity 99 percent defused. prosecutors when they fear federal sentences communities. This body saw the destruction Who will benefit? Gang leaders and crack more than they fear and are loyal to their wrought on entire communities by this cheap dealers whose business and activities are al- fellow gang members. Gangs thrive in pris- and highly addictive form of cocaine and de- ready destroying the lives and the future of ons, and short prison sentences only give cided that crack offenses ought to be pun- one of the most vulnerable segments of our gang members a chance to advance in rank society. and return to the streets with more power ished more severely than powder offenses be- Who will be hurt? The children of crack ad- than when they went in. Only very long sen- cause of the violence associated with the use dicts who will continue to have everything of tences can remove the smirk from a hard- and trafficking of crack. value in their households, including the ened gang member’s face and make him even I would alert my colleagues that there is an- money for food and clothing, and sometimes consider helping the police. other way to achieving equal treatment of even their own bodies, given or sold by their If the sentences for crack crimes are re- crack and powder cocaine: Instead of lowering parents to crack dealers for just one more duced as proposed, the smirk will return. fix. And the other helpless hostages of gangs The threat will go out of federal sentences. the penalties for crack offenses, as the Sen- in communities in which the most violent tencing Commission proposes, we should in- Agents and prosecutors will be largely dis- predators among them will be able to walk armed in their fight against the most dan- crease the punishment for powder offenses. in the open with more confidence as they gerous and destructive predators in our The advantages would be two-fold: First, it build their empires of drugs and violence. cities. How will it happen? The United States would prevent opponents from playing the Some people believe the drug laws are too ``race card.'' Second, it would stiffen the pen- Sentencing Commission, which sets the guidelines federal judges must follow in im- harsh on those predators, and want to ease alties for cocaine offenses, which are currently posing sentences, has recommended that the up on the federal pressure on gangs. At the far too lenient. sentencing guidelines for crack offenses be moment, those sympathizers are in control. Whatever path is takenÐmaintaining the reduced to equal the far lesser penalties for Only Congress can stop them, but most current ratioÐor mildly reducing itÐor raising cocaine powder. Currently, one unit of crack members of Congress may not even be aware is treated as the equivalent of 100 units of co- of or understand the threat, so they will do the penalties for powder offenses to achieve nothing. Which means the decriminalizers equal treatmentÐone point must be empha- caine for sentencing purposes. That 100:1 ratio is also embodied in the federal manda- win, automatically! sized: Congress must do something. For if tory minimum sentences, which provide a For the sake of the most vulnerable in our Congress fails to address the hasty rec- mandatory five year sentence for offenses in- society, we must not let that happen! ommendation offered by the Sentencing Com- volving five grams of crack (or 500 grams of The penalties for cocaine powder should be mission, it will automatically become law on cocaine), and 10 years for 50 grams of crack raised to equal those of crack, not the other November 1, 1995. (or 5 kilograms of cocaine). way around. Tuesday, June 27, 1995 Daily Digest Senate Commission to review the regulatory ‘‘safe harbor’’ Chamber Action for forward looking statements. Pages S9117±31 Routine Proceedings, pages S9109–S9198 (4) Sarbanes Amendment No. 1478, to establish Measures Introduced: Seven bills and one resolu- that an exemption from liability is lost for forward tion were introduced, as follows: S. 968–974, and S. looking statements made when knowingly mislead- ing or false. By 50 yeas to 48 nays, 1 responding Res. 142. Page S9174 present (Vote No. 289), Senate tabled the amend- Measures Passed: ment. Pages S9133±45 Congratulating the New Jersey Devils: Senate (5) By 32 yeas to 61 nays, 1 responding present agreed to S. Res. 142, to congratulate the N.J. Dev- (Vote No. 290), Graham Amendment No. 1479, to ils for becoming the 1995 NHL champions and thus provide for an early evaluation procedure in securi- winning the Stanley Cup. Pages S9174, S9182 ties class actions. Pages S9150±56, S9162 Pending: Private Securities Litigation Reform Act: Senate (1) Boxer Amendment No. 1480, to exclude in- continued consideration of S. 240, to amend the Se- sider traders who benefit from false or misleading curities Exchange Act of 1934 to establish a filing forward looking statements from safe harbor protec- deadline and to provide certain safeguards to ensure tion. Pages S9156±63 that the interests of investors are well protected (2) Specter Amendment No. 1483, to provide for under the implied private action provisions of the sanctions for abuse litigation. Pages S9164±70 Act, with a committee amendment in the nature of (3) Specter Amendment No. 1484, to provide for a substitute, taking action on further amendments a stay of discovery in certain circumstances. proposed thereto, as follows: Pages S9109±45, S9150±73 Page S9170 Adopted: (4) Specter Amendment No. 1485, to clarify the (1) D’Amato Modified Amendment No. 1476, of standard plaintiffs must meet in specifying the de- a perfecting nature. Page S9117 fendant’s state of mind in private securities litiga- (2) Biden Amendment No. 1481, to make appli- tion. Pages S9170±73 cable the criminal Rico statutes if any participant in A unanimous-consent agreement was reached pro- fraud is criminally convicted. Page S9163 viding for further consideration of the bill and the (3) Bingaman/Bryan Amendment No. 1482, to pending amendments proposed thereto, with votes to clarify the application of sanctions under rule 11 of occur thereon, on Wednesday, June 28, 1995. the Federal Rules of Civil Procedure in private secu- Page S9163 rities litigation. Pages S9163±64 Nominations Received: Senate received the follow- Rejected: ing nominations: (1) By 39 yeas to 60 nays, 1 responding present Todd J. Campbell, of Tennessee, to be United (Vote No. 286), Bryan Amendment No. 1474, to re- States District Judge for the Middle District of Ten- store the liability of aiders and abetters in private ac- nessee. tions. Pages S9109±12, S9115±16 James M. Moody, of Arkansas, to be United States (2) By 41 yeas to 58 nays, 1 responding present District Judge for the Eastern District of Arkansas. (Vote No. 287), Boxer/Bingaman Amendment No. Evan J. Wallach, of Nevada, to be a Judge of the United States Court of International Trade. 1475, to establish procedures governing the appoint- Alberto J. Mora, of Florida, to be a Member of ment of lead plaintiffs in private securities class ac- the Broadcasting Board of Governors for a term of tions. Pages S9112±17 two years. Page S9198 (3) By 43 yeas to 56 nays, 1 responding present (Vote No. 288), Sarbanes/Lautenberg Amendment Communications: Page S9174 No. 1477, to require the Securities and Exchange Statements on Introduced Bills: Pages S9174±81 D 791 D 792 CONGRESSIONAL RECORD — DAILY DIGEST June 27, 1995

Additional Cosponsors: Pages S9181±82 posed legislation authorizing funds for fiscal year Amendments Submitted: Pages S9182±85 1996 for national defense programs. Notices of Hearings: Page S9185 PROPERTY RIGHTS AND ENVIRONMENTAL Authority for Committees: Page S9186 LAWS Additional Statements: Pages S9186±95 Committee on Environment and Public Works: Commit- tee held oversight hearings on proposals to supple- Record Votes: Five record votes were taken today. ment the legal framework for private property inter- (Total–290) Pages S9116±17, S9130±31, S9144±45, S9162 ests, focusing on the operation of Federal environ- Recess: Senate convened at 9:15 a.m., and recessed mental laws, including related provisions of S. 605, at 9:38 p.m., until 8:40 a.m., on Wednesday, June receiving testimony from John R. Schmidt, Associate 28, 1995. (For Senate’s program, see the remarks of Attorney General, Department of Justice; Joseph L. the Acting Majority Leader in today’s RECORD on Sax, Counselor to the Secretary and Deputy Assistant page S9195.) Secretary for Policy, Department of the Interior; New Hampshire State Senator Richard L. Russman, Kingston, on behalf of the National Conference of Committee Meetings State Legislatures; Roger J. Marzulla, Akin, Gump, (Committees not listed did not meet) Strauss, Hauer and Feld, Roger Pilon, CATO Insti- tute, and Edward M. Thompson, Jr., American APPROPRIATIONS—DEFENSE Farmland Trust, all of Washington, D.C.; Frank I. Committee on Appropriations: Subcommittee on Defense Michelman, Harvard University Law School, Cam- held hearings on proposed budget estimates for fiscal bridge, Massachusetts; Jim Little, Emmett, Idaho, on year 1996 for the Department of Defense, focusing behalf of the National Cattlemen’s Association; and on the ballistic missile defense program, receiving Don Martin, Albuquerque, New Mexico, on behalf testimony from Lt. Gen. Malcolm R. O’Neill, Direc- of the National Association of Home Builders. tor, Ballistic Missile Defense Organization, Depart- Hearings were recessed subject to call. ment of Defense. SOCIAL SECURITY TRUST FUNDS Subcommittee will meet again on Tuesday, July 11. Committee on Finance: Subcommittee on Social Secu- rity and Family Policy held hearings on proposals to AUTHORIZATION—DEFENSE restore the long-term solvency of the Social Security Committee on Armed Services: Subcommittee on Readi- System, focusing on the Old Age and Survivors In- ness met and approved those provisions which fall surance Trust Fund and the Disability Insurance within its jurisdiction of proposed legislation author- Trust Fund, receiving testimony from Senator izing funds for fiscal year 1996 for national defense Kerrey; David M. Walker, Arthur Andersen LLP, programs. Atlanta, Georgia, former Public Trustee of the Social Security and Medicare Trust Funds, and former As- AUTHORIZATION—DEFENSE sistant Secretary of Labor; and Stanford G. Ross, Ar- Committee on Armed Services: Subcommittee on Airland nold & Porter, former Commissioner of Social Secu- Forces met in closed session to mark up those provi- rity and former Public Trustee of the Social Security sions which fall within its jurisdiction of proposed and Medicare Trust Funds, Mark A. Weinberger, legislation authorizing funds for fiscal year 1996 for Oldaker, Ryan & Leonard, Anne C. Canfield, national defense programs, but did not complete ac- McClure, Gerard & Neuenschwander, Inc., Heather tion thereon and will meet again tomorrow. Lamm, Third Millennium, C. Eugene Steuerle, Urban Institute, and Allan Tull, American Associa- AUTHORIZATION—DEFENSE tion of Retired Persons, all of Washington, D.C. Committee on Armed Services: Subcommittee on Hearings were recessed subject to call. SeaPower met in closed session and approved those provisions which fall within its jurisdiction of pro- DEPARTMENT OF JUSTICE OVERSIGHT posed legislation authorizing funds for fiscal year Committee on the Judiciary: Committee held oversight 1996 for national defense programs. hearings on the activities and responsibilities of the Department of Justice, focusing on the administra- AUTHORIZATION—DEFENSE tion of justice and the enforcement of laws, receiving Committee on Armed Services: Subcommittee on Strate- testimony from Janet Reno, Attorney General, De- gic Forces met in closed session and approved those partment of Justice. provisions which fall within its jurisdiction of pro- Hearings were recessed subject to call. June 27, 1995 CONGRESSIONAL RECORD — DAILY DIGEST D 793 NOMINATIONS health care costs, focusing on brain research and the Committee on the Judiciary: Committee concluded long-term-care costs of brain-related disorders, and a hearings on the nominations of Dianne P. Wood, of task force report on how to prioritize and fund Illinois, to be United States Circuit Judge for the aging-related research, after receiving testimony from Seventh Circuit, Tena Campbell, to be United States Senator Hatfield; Richard W. Besdine, University of District Judge for the District of Utah, George H. Connecticut Health Center, Farmington, Connecti- King, to be United States District Judge for the cut, representing the Alliance for Aging Research; Central District of California, and Robert H. Guy M. McKhann, Johns Hopkins University, Balti- Whaley, to be United States District Judge for the more, Maryland, representing the Dana Alliance for Eastern District of Washington, after the nominees Brain Initiatives; Jerry Avorn and Dennis J. Selkoe, testified and answered questions in their own behalf. both of the Brigham and Women’s Hospital, and Ms. Wood was introduced by Senators Simon and Ole Isacson, McLean Hospital, all of the Harvard Moseley-Braun, Ms. Campbell was introduced by University Medical School, Arthur D. Ullian, Na- Senators Hatch and Bennett, Mr. King was intro- tional Campaign to End Neurological Disorders, and duced by Senator Boxer, and Mr. Whaley was intro- Benjamin Reeve, all of Boston, Massachusetts; Rob- duced by Senators Gorton and Murray. ert M. Goldberg, Brandeis University, Waltham, Massachusetts; Allen D. Roses, Duke University BRAIN RESEARCH AND HEALTH CARE Medical Center, Durham, North Carolina; Dennis COST REDUCTION W. Choi, Washington University School of Medi- Special Committee on Aging: Committee concluded cine, St. Louis, Missouri; Millicent R. Kondracke, hearings to examine how investment in research into Washington, D.C.; and Frances Powers, Lebanon, the causes and courses of certain diseases can reduce Pennsylvania. h House of Representatives H. Res. 173, proposing an amendment to the Chamber Action Constitution of the United States authorizing the Bills Introduced: Fifteen public bills, H.R. Congress and the States to prohibit the physical 1926–1940; and three resolutions, H.J. Res. 98, H. desecration of the flag of the United States (H. Rept. Con. Res. 79, and H. Res. 174 were introduced. 104–164). Pages H6377, H6395±96 Page H6396 Speaker Pro Tempore: Read a letter from the Reports Filed: Reports were filed as follows: Speaker wherein he designates Representative Emer- H.R. 541, to reauthorize the Atlantic Tunas Con- son to act as Speaker pro tempore for today. vention Act of 1975, amended (H. Rept. 104–109, Page H6313 Part 2); Recess: House recessed at 10:52 a.m. and recon- H.R. 1642, to extend nondiscriminatory treat- vened at noon. Page H6315 ment (most-favored-nation treatment) to the prod- Catafalque Transfer: House agreed to S. Con. Res. ucts of Cambodia (H. Rept. 104–160); 18, authorizing the Architect of the Capitol to trans- H.R. 1887, to authorized appropriations for fiscal fer the catafalque to the Supreme Court for a funeral years 1996 and 1997 for the International Trade service—clearing the measure. Page H6319 Commission, the Customs Service, and the Office of the United States Trade Representatives, amended, Committees To Sit: The following committees and (H. Rept. 104–161); their subcommittees received permission to sit today during the proceedings of the House under the five- H.R. 1643, to authorize the extension of non- minute rule: Committees on Banking and Financial discriminatory treatment (most-favored-nation treat- Services, Commerce, Economic and Educational Op- ment) to the products of Bulgaria (H. Rept. portunities, Government Reform and Oversight, 104–162); International Relations, Resources, Science, Trans- H.R. 1176, to nullify an executive order that pro- portation and Infrastructure, and Select Intelligence. hibits Federal contracts with companies that hire Page H6319 permanent replacements for striking employees (H. Rept. 104–163); Air Force Academy: The Speaker appointed Rep- resentatives Young of Florida, Hefley, Dicks, and D 794 CONGRESSIONAL RECORD — DAILY DIGEST June 27, 1995 Tanner, as members of the Board of Visitors to the ronment Facility (agreed to by a recorded vote of United States Air Force Academy on the part of the 273 ayes to 146 noes, Roll No. 427). Pages H6364±70 House. Page H6319 Rejected: Veterans Health Care: House voted to suspend the The Gilman amendment that sought to reduce the rules and pass H.R. 1565, amended, to amend title Development Assistance Fund by $25 million to 38, United States Code, to extend through Decem- conform with the foreign aid authorization (rejected ber 31, 1997, the period during which the Secretary by a recorded vote of 202 ayes to 218 noes, Roll No. of Veterans Affairs is authorized to provide priority 420); Pages H6326±30 health care to certain veterans exposed to Agent Or- The Sanders amendment that sought to abolish ange, ionizing radiations, or environmental hazards. the Overseas Private Investment Corporation (OPIC) Agreed to amend the title. Pages H6319±23 by October 1, 1995, and transfer the remaining functions to the State Department (rejected by a re- Foreign Operations Appropriations: House con- tinued consideration of H.R. 1868, making appro- corded vote of 90 ayes and 329 noes, Roll No. 421); priations for foreign operations, export financing, Pages H6330±37 and related programs for the fiscal year ending Sep- The Brownback amendment that sought to restore tember 30, 1996; but came to no resolution thereon. $24 million in assistance to the states of the former Consideration of amendments will continue on Soviet Union (rejected by a recorded vote of 78 ayes to 340 noes, Roll No. 422); and Pages H6341±44 Wednesday, June 28. Pages H6324±77 Agreed to: The Hefley amendment to the Wilson substitute The Gilman amendment that strikes language to the Miller of Florida amendment that sought to protecting the new child survival account from other reduce funding to the new independent states of the laws; maintains a prohibition transferring funds from former Soviet Union by $327 million (rejected by a development assistance to other accounts; restates recorded vote of 104 ayes to 320 noes, Roll No. funding for Russia and the states of the former So- 425). Pages H6355±60 viet Union be used for limited purposes; and lowers The following amendments were offered but sub- the ratio of private to public funds to 1 to 1, that sequently withdrawn: the former states must raise to qualify for certain The Richardson amendment that sought to in- funding; Pages H6325±26 crease funding for migration and refugee assistance The Klug amendment, as amended by the Cal- by $1 million to assist the Thai-Burma border crisis; lahan substitute, that reduces to $69,000, allocations Pages H6344±46 for the cost of direct and guaranteed loans and The Lowey amendment that sought to prohibit strikes language that requires OPIC’s subsidy come funding for international military education and from its non-credit account; Pages H6337±39 training in Indonesia; and Pages H6361±64 The Burton of Indiana amendment that eliminates The Wilson amendment that sought to reduce by the $30 million Agency for International Develop- $10 million funding for the World Bank’s Global ment (AID) reform and downsizing account (agreed Environment Facility. Pages H6366±68 to by a recorded vote of 238 ayes to 176 noes, Roll Soap Box Derby: House agreed to H. Con. Res. 38, No. 423); Pages H6346±49 authorizing the use of the Capitol grounds for the The Hall of Ohio amendment, as modified, that Greater Washington Soap Box Derby. Page H6377 increases the allocation to the Child Survival and Committees To Sit: The following committees and Disease Fund by $108 million (agreed to by a re- their subcommittees received permission to sit corded vote of 263 ayes to 187 noes, Roll No. 424); Wednesday, June 28, during the proceedings of the Pages H6349±54 House under the five-minute rule: Committees on The Miller of Florida amendment, as amended by Agriculture, Banking and Financial Services, Com- the Wilson substitute amendment, that reduces merce, Economic and Educational Opportunities, funding to the new independent states of the former Government Reform and Oversight, Judiciary, Na- Soviet Union by $15 million; Pages H6354±60 tional Security, Small Business, and Select Intel- The Jackson-Lee amendment that increases fund- ligence. Page H6378 ing for the African Development Foundation by $1.5 million; and Pages H6360±61 Senate Messages: Messages received from the Senate The DeLay amendment, as amended by the Porter today appear on pages H6315–16. amendment (agreed to by a recorded vote of 242 Amendments Ordered Printed: Amendments or- ayes to 180 noes, Roll No. 426) that reduces by $20 dered printed pursuant to the rule appear on pages million funding for the World Bank’s Global Envi- H6397–98. June 27, 1995 CONGRESSIONAL RECORD — DAILY DIGEST D 795 Quorum Calls—Votes: Eight recorded votes devel- ILLICIT DRUG AVAILABILITY oped during the proceedings of the House today and Committee on Government Reform and Oversight: Sub- appear on pages H6329–30, H6336–37, H6343–44, committee on National Security, International Af- H6349, H6353–54, H6360, H6370, and fairs, and Criminal Justice held a hearing on Illicit H6370–71. Drug Availability: Are Interdiction Efforts Ham- There were no quorum calls. pered by a Lack of Agency Resources? Testimony Adjournment: Met at 10:30 a.m. and adjourned at was heard from Thomas A. Constantine, Adminis- 11:36 p.m. trator, DEA, Department of Justice; Joseph Kelly, Director-In-Charge, International Affairs Issues, GAO; Ambassador Jane E. Becker, Principal Deputy Committee Meetings Assistant Secretary, International Narcotics and Law AGRICULTURE AND INTERIOR Enforcement, Department of State; and Brian Sheri- APPROPRIATIONS dan, Deputy Assistant Secretary, Drug Enforcement Committee on Appropriations: Ordered reported the fol- Policy and Support, Department of Defense; and lowing appropriations for fiscal year 1996: Agri- public witnesses. culture and Interior. Hearings continue tomorrow. VALUE OF MICROENTERPRISE FINANCIAL INSTITUTIONS REGULATORY DEVELOPMENT RELIEF ACT Committee on International Relations: Held a hearing on Committee on Banking and Financial Services: Continued the Value of Microenterprise Development. Testi- markup of H.R. 1362, Financial Institutions Regu- mony was heard from Roxann A. VanDusen, Senior latory Relief Act of 1995. Deputy Assistant Administrator, Global Programs, Will continue tomorrow. Field Support and Research, AID, U.S. International INDIVIDUALS WITH DISABILITIES Cooperation Agency; and public witnesses. EDUCATION ASIA-U.S. SECURITY INTERESTS Committee on Economic and Educational Opportunities: Committee on International Relations: Subcommittee on Subcommittee on Early Childhood, Youth and Fami- Asia and the Pacific held a hearing on U.S. Security lies continued hearings on the Individuals with Dis- Interests in Asia. Testimony was heard from Win- abilities Education Act. Testimony was heard from ston Lord, Assistant Secretary, East Asian and Pacific Representatives Visclosky and Traficant; and public Affairs, Department of State; and the following offi- witnesses. cials of the Department of Defense: Joseph S. Nye, D.C. SCHOOL REFORM Assistant Secretary, International Security Affairs; and Adm. Richard C. Macke, USN, Commander-in- Committee on Economic and Educational Opportunities: Chief, U.S. Pacific Command. Subcommittee on Oversight and Investigations held a hearing on D.C. School Reform. Testimony was OVERSIGHT heard from public witnesses. Committee on Resources: Subcommittee on Energy and GOVERNMENT PERFORMANCE AND Mineral Resources held an oversight hearing on the RESULTS ACT COMPLIANCE issue of Federal oversight of States acting under the Surface Mining Control and Reclamation Act of Committee on Government Reform and Oversight: Sub- 1977 to effectively regulate active coal mining oper- committee on Government Management, Informa- ations and protect the environment consistent with tion, and Technology held a hearing on Government the State primacy provision of the Act. Testimony Performance and Results Act Compliance. Testimony was heard from Robert Uram, Director, Office of was heard from John A. Koskinen, Deputy Director, Surface Mining Reclamation and Enforcement, De- Management, OMB; Johnny C. Finch, Assistant partment of the Interior; Charles R. Matthews, Com- Comptroller General, General Government Pro- missioner of Railroads, State of Texas; Ted Stewart, grams, GAO; Anthony A. Williams, Chief Financial Director, Natural Resources, State of Utah; and pub- Officer, USDA; Vice Adm. Arthur Henn, USCG, lic witnesses. Vice Commandant, U.S. Coast Guard, Department of Transportation; Joseph Thompson, Director, New MISCELLANEOUS MEASURES York Regional Office, Department of Veterans Af- Committee on Resources: Subcommittee on Fisheries, fairs; Col. F. Edward Ward, Jr., Director, Field Of- Wildlife and Oceans approved for full Committee fices, Defense Finance Accounting Service, Depart- action the following bills: S. 268, to authorize the ment of Defense; and public witnesses. collection of fees for expenses for triploid grass carp D 796 CONGRESSIONAL RECORD — DAILY DIGEST June 27, 1995 certification inspection; and H.R. 1675, amended, Compensation and Liability Act of 1980 National Wildlife Refuge Improvement Act of 1995. (Superfund). Testimony was heard from Carol M. MISCELLANEOUS MEASURES Browner, Administrator, EPA; Lois Schiffer, Assist- ant Attorney General, Department of Justice; Sherri Committee on Resources: Subcommittee on National Goodman, Deputy Under Secretary, Environmental Parks, Forests and Lands approved for full Commit- Security, Department of Defense; Tom Grumbly, As- tee action the following bills: H.R. 1296, amended, sistant Secretary, Environmental Management, De- to provide for the administration of certain Presidio partment of Energy; and Robert P. Davison, Assist- properties at minimal cost to the Federal taxpayer; ant Secretary, Fish, Wildlife and Parks, U.S. Fish H.R. 629, The Fall River Visitor Center Act of and Wildlife Service, Department of the Interior. 1995; and H.R. 1508, to require the transfer of title to the District of Columbia certain real property in FAMILY MEDICAL SAVINGS AND Anacostia Park to facilitate the construction of Na- INVESTMENT ACT tional Children’s Island, a cultural, educational, and Committee on Ways and Means: Subcommittee on family-oriented park. Health held a hearing on H.R. 1818, Family Medi- PROHIBITING PHYSICAL DESECRATION OF cal Savings and Investment Act of 1995. Testimony THE FLAG was heard from Representatives Archer, Jacobs, Christensen, Roberts, Chrysler, Salmon, and Ganske; Committee on Rules: Granted, by a voice vote, a rule Brett Schundler, Mayor, Jersey City, New Jersey; providing for consideration of H.J. Res. 79, propos- and public witnesses. ing an amendment to the Constitution of the United f States authorizing the Congress and the State to pro- hibit the physical desecration of the flag of the Unit- COMMITTEE MEETINGS FOR ed States, in the House. The rule provides for 1 hour WEDNESDAY, JUNE 28, 1995 of general debate. The previous question shall be (Committee meetings are open unless otherwise indicated) considered as ordered on the joint resolution to final passage without intervening motion except one mo- Senate tion to recommit, with or without instructions. The Committee on Armed Services, Subcommittee on Acquisi- rule provides that if the motion to recommit is with tion and Technology, closed business meeting, to mark instructions, it may only be offered by the minority up those provisions which fall within the subcommittee’s leader or a designee but shall be debatable for 1 jurisdiction of a proposed National Defense Authorization hour, equally divided between the proponent and an Act for fiscal year 1996, 9 a.m., SR–222. opponent. Testimony was heard from Chairman Subcommittee on Airland Forces, closed business meet- Hyde and Representatives Canady, Conyers, Frank of ing, to continue markup of those provisions which fall under its jurisdiction of proposed legislation authorizing Massachusetts, Thornton, and Skaggs. funds for fiscal year 1996 for national defense programs, TECHNOLOGY TRANSFER 10 a.m., SR–232A. Full Committee, closed business meeting, to mark up Committee on Science: Subcommittee on Technology a proposed National Defense Authorization Act for fiscal and the Subcommittee on Basic Research held a year 1996, and to receive a report from the Senate Select joint hearing on Technology Transfer. Testimony Committee on Intelligence on the Intelligence Authoriza- was heard from Richard Marczewski, Manager, Tech- tion Act for fiscal year 1996, 1 p.m., SR–222. nology Transfer Office, National Renewable Energy Committee on Banking, Housing, and Urban Affairs, busi- Laboratory, Department of Energy; Ambassador C. ness meeting, to mark up S. 883, to amend the Federal Paul Robinson, Vice President, Laboratory Develop- Credit Union Act to enhance the safety and soundness of ment, Sandia National Laboratory; William Martin, federally insured credit unions, and to protect the Na- Vice President, Office of Technology Transfer, Lock- tional Credit Union Share Insurance Fund, and proposed heed-Martin Energy Systems, Oak Ridge National legislation to extend and reauthorize the Defense Produc- Laboratory; Peter Lyons, Director, Industrial Partner- tion Act, and to consider pending nominations, 10 a.m., SD–538. ship Office, Los Alamos National Laboratory; Ronald Committee on Energy and Natural Resources, business W. Cochran, Laboratory Executive Officer, Lawrence meeting, to consider pending calendar business, 9:30 Livermore National Laboratory; and public witnesses. a.m., SD–366. SUPERFUND REAUTHORIZATION Committee on Finance, to hold hearings to examine ways to control the cost of the Medicaid program, focusing on Committee on Transportation and Infrastructure: Sub- the States’ perspectives, 9:30 a.m., SD–215. committee on Water Resources and Environment Committee on the Judiciary, Subcommittee on Immigra- continued hearings on the reauthorization and reform tion, to hold joint hearings with the House Committee of the Comprehensive Environmental Response, on the Judiciary’s Subcommittee on Immigration and June 27, 1995 CONGRESSIONAL RECORD — DAILY DIGEST D 797

Claims to review a report of the U.S. Commission on Im- Subcommittee on International Operations and Human migration, 10 a.m., 2141 Rayburn Building. Rights, to consider the issuance of subpoenas, writs of ha- Committee on Indian Affairs, to hold hearings on S. 814, beas corpus ad testificandum, and/or other measures to se- to provide for the reorganization of the Bureau of Indian cure the attendance of witnesses, 9:30 a.m., 2172 Ray- Affairs, 9:30 a.m., SR–485. burn. Committee on the Judiciary, Subcommittee on Commer- House cial and Administrative Law, hearing on state taxation of Committee on Agriculture, to mark up H.R. 1103, Perish- nonresidents’ pension income, including the following able Agricultural Commodities Act, 1930, 10 a.m., 1300 bills: H.R. 371, to prohibit a State from imposing an in- come tax on the pension income of individuals who are Longworth. not residents or domiciliaries of that State; H.R. 394, to Committee on Appropriations, Subcommittee on Com- amend title 4 of the United States Code to limit State merce, Justice, State, and Judiciary, to mark up appro- taxation of certain pension income; and H.R. 744, to priation for fiscal year 1996, 1 p.m., H–309 Capitol. limit State taxation of certain pension income, 10 a.m., Subcommittee on District of Columbia, on D.C. Fi- 2226 Rayburn. nances, 10 a.m., H–144 Capitol. Subcommittee on Courts and Intellectual Property, to Subcommittee on Treasury, Postal Service, and General continue hearings on H.R. 1506, Digital Performance Government, to mark up appropriations for fiscal year Right in Sound Recordings Act of 1995, 10 a.m., 2237 1996, 8:30 a.m., B–307 Rayburn. Rayburn. Committee on Banking and Financial Services, to continue Committee on National Security, Subcommittee on Mili- mark up of H.R. 1362, Financial Institutions Regulatory tary Personnel, hearing on U.S. POW/MIAs in Laos, 10 Relief Act of 1995, 9:30 a.m., 2128 Rayburn. a.m., 2118 Rayburn. Committee on Commerce, Subcommittee on Energy and Committee on Rules, to consider the following: Con- Power, oversight hearing on High-Level Radioactive ference Report to accompany H. Con. Res. 67, setting Waste Disposal, 9:30 a.m., 2322 Rayburn. forth the congressional budget for the United States Gov- Subcommittee on Health and Environment, to con- ernment for the fiscal years 1996, 1997, 1998, 1999, tinue hearings on the Transformation of the Medicaid 2000, 2001, and 2002; and a measure making emergency program, 10 a.m., 2123 Rayburn. supplemental appropriations for additional disaster assist- Committee on Economic and Educational Opportunities, Sub- ance and making rescissions for the fiscal year ending committee on Early Childhood, Youth and Families, hear- September 30, 1995, 4 p.m., H–313 Capitol. ing on the Older American’s Act, 10 a.m., 2261 Ray- Committee on Science, hearing on Restructuring the Fed- burn. eral Scientific Establishment, 9:30 a.m., and to mark up Subcommittee on Workforce Protections, to continue the following bills: H.R. 1815, American Technology hearings on H.R. 1834, Safety and Health Improvement Advancement Act of 1995; H.R. 1175, Marine Resources Reform Act of 1995, 10 a.m., 2175 Rayburn. Revitalization Act of 1995; H.R. 1601, International Committee on Government Reform and Oversight, Sub- Space Station Authorization Act; H.R. 1870, American committee on Civil Service, hearing on Funding Civil Technology Advancement Act of 1995; H.R. 1852, Na- Service Retirement, 10 a.m., 2154 Rayburn. tional Science Foundation Authorization Act; and H.R. Subcommittee on National Security, International Af- 1851, the United States Fire Administration Authoriza- fairs, and Criminal Justice, to continue hearings on Illicit tion Act, 12 p.m., 2318 Rayburn. Drug Availability: Are Interdiction Effort Hampered by Committee on Small Business, Subcommittee on Govern- a Lack of Agency Resources? 10 a.m., 311 Cannon. ment Programs, hearing on SBA’s Low-Documentation Subcommittee on Postal Service, to continue oversight (LowDoc) Loan Program, 2 p.m., 2359 Rayburn. hearings on the U.S. Postal Service, 10 a.m., 2247 Ray- Subcommittee on Taxation and Finance, to continue burn. hearings on the Burden of Payroll Taxes on Small Busi- Committee on International Relations, to mark up the fol- nesses, 10 a.m., 2359 Rayburn. lowing measures: H.R. 927, Cuban Liberty and Demo- Committee on Standards of Official Conduct, executive, to cratic Solidarity Act of 1995; and H.J. Res. 83, relating consider pending business, 1 p.m., HT–2M Capitol. to the United States-North Korea Agreed Framework and the obligations of North Korea under that and previous Joint Meetings agreements with respect to the denuclearization of the Joint Hearing: Senate Committee on the Judiciary, Sub- Korean Peninsular and dialog with the Republic of committee on Immigration, to hold joint hearings with Korea, 2 p.m., 2172 Rayburn. the House Committee on the Judiciary’s Subcommittee Subcommittee on International Economic Policy and on Immigration and Claims to review a report of the U.S. Trade, oversight hearing on the U.S. AID Housing In- Commission on Immigration, 10 a.m., 2141 Rayburn vestment Guaranty Program, 10 a.m., 2200 Rayburn. Building. D 798 CONGRESSIONAL RECORD — DAILY DIGEST June 27, 1995

Next Meeting of the SENATE Next Meeting of the HOUSE OF REPRESENTATIVES 8:40 a.m., Wednesday, June 28 10 a.m., Wednesday, June 28

Senate Chamber House Chamber Program for Wednesday: Senate will resume consider- Program for Wednesday and the balance of the ation of S. 240, Private Securities Litigation Reform Act, week: Complete consideration of H.R. 1868, Foreign with votes on the pending amendments and final passage Operations Appropriations Act; to occur thereon. Consideration of H.J. Res. 79, Constitutional Amend- Senate also expects to begin consideration of S. 343, ment prohibiting the physical desecration of the flag (rule Comprehensive Regulatory Reform Act. providing 1 hour of debate in the House); Conference report on H. Con. Res. 67, Budget Resolu- tion; Conference report on H.R. 483, Medicare Select Exten- sion Act; and Consideration of H.R. 1905, Energy and Water Appro- priation Act.

Extensions of Remarks, as inserted in this issue

HOUSE Gillmor, Paul E., Ohio, E1330, E1335 Nadler, Jerrold, N.Y., E1340 Gordon, Bart, Tenn., E1339 Radanovich, George P., Calif., E1329 Barcia, James A., Mich., E1332 Hamilton, Lee H., Ind., E1341 Schroeder, Patricia, Colo., E1337 Beilenson, Anthony C., Calif., E1331 Hoke, Martin R., Ohio, E1342 Shuster, Bud, Pa., E1335 Berman, Howard L., Calif., E1336, E1337, E1340 Hoyer, Steny H., Md., E1330 Slaughter, Louise McIntosh, N.Y., E1339 Bliley, Thomas J., Jr., Va., E1333 Hyde, Henry J., Ill., E1333 Solomon, Gerald B.H., N.Y., E1343, E1344 Burton, Dan, Ind., E1336 Jones, Walter B., Jr., N.C., E1329 Ehrlich, Robert L., Jr., Md., E1333 Lazio, Rick, N.Y., E1340 Stump, Bob, Ariz., E1344 Engel, Eliot L., N.Y., E1340 McCarthy, Karen, Mo., E1337 Taylor, Charles H., N.C., E1335 Filner, Bob, Calif., E1344 Markey, Edward J., Mass., E1330 Tucker, Walter R., III, Calif., E1330, E1336 Forbes, Michael P., N.Y., E1329 Miller, George, Calif., E1331 Underwood, Robert A., Guam, E1336 Franks, Bob, N.J., E1338 Moran, James P., Va., E1334 Young, Don, Alaska, E1332

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