E PL UR UM IB N U U S Congressional Record United States th of America PROCEEDINGS AND DEBATES OF THE 109 CONGRESS, FIRST SESSION

Vol. 151 WASHINGTON, MONDAY, MARCH 7, 2005 No. 25 Senate The Senate met at 2 p.m. and was Pending: and pursuant to our unanimous con- called to order by the President pro Leahy amendment No. 26, to restrict ac- sent agreement, all first-degree amend- tempore (Mr. STEVENS). cess to certain personal information in bank- ments should be filed by 2:30 today and PRAYER ruptcy documents. second-degrees by noon tomorrow. We The Chaplain, Dr. Barry C. Black, of- Feinstein amendment No. 19, to enhance also have a unanimous consent agree- disclosures under an open end credit plan. fered the following prayer: Kennedy amendment No. 44, to amend the ment that provides for a vote in rela- Let us pray. Fair Labor Standards Act of 1938 to provide tion to the Schumer amendment at Merciful God, Who lives and reigns for an increase in the Federal minimum 12:15 p.m. tomorrow, on Tuesday. forever, You know every heart and wage. With that said, we will have busy ses- mind. You are the shield and protec- Dorgan/Durbin amendment No. 45, to es- sions over the next couple of days as tion of those whose hearts are right. tablish a special committee of the Senate to we try to finish our work on the bank- We thank You for being so near to us. investigate the awarding and carrying out of ruptcy bill. I do hope we can invoke We thank You also for the gift of life contracts to conduct activities in Afghani- cloture tomorrow afternoon and bring stan and Iraq and to fight the war on ter- and for the blessing of this new day. rorism. this bill to a final vote. As all Senators Give wisdom to our lawmakers in Pryor amendment No. 40, to amend the know, if cloture is invoked, germane their work. Let kindness and justice Fair Credit Reporting Act to prohibit the use amendments are still in order, and characterize their deliberations. May of any information in any consumer report there could be up to an additional 30 the decisions they make help build de- by any credit card issuer that is unrelated to hours of consideration. fenses for the weak and shelters for the the transactions and experience of the card Last week, we had a productive week. strangers. Give them words that will issuer with the consumer to increase the an- We had full days of debate and votes. bring healing and a renewal of hope. nual percentage rate applicable to credit ex- tended to the consumer. Therefore, I expect we will complete Destroy the power of evil and give Reid (for Baucus) amendment No. 50, to action on the bill either Tuesday or strength to those who follow You. God amend section 524(g)(1) of title 11, United Wednesday of this week. all powerful, listen and answer, for we States Code, to predicate the discharge of Mr. President, I would be happy to trust in You. Amen. debts in bankruptcy by a vermiculite mining turn to the Democratic leader. f company meeting certain criteria on the es- Mr. President, I would like to make a tablishment of a health care trust fund for few comments on another issue now be- PLEDGE OF ALLEGIANCE certain individuals suffering from an asbes- cause at 2:30 today we will be going to tos related disease. The PRESIDENT pro tempore led the the debate on the minimum wage Pledge of Allegiance, as follows: Dodd amendment No. 52, to prohibit exten- sions of credit to underage consumers. amendments. I pledge allegiance to the Flag of the Dodd amendment No. 53, to require prior PILGRIMAGE TO SELMA AND THE 40TH United States of America, and to the Repub- notice of rate increases. ANNIVERSARY OF BLOODY SUNDAY lic for which it stands, one nation under God, RECOGNITION OF THE MAJORITY LEADER Mr. President, I rise to spend a few indivisible, with liberty and justice for all. The PRESIDENT pro tempore. The moments reflecting on a historical f majority leader is recognized. event that occurred 40 years ago today. RESERVATION OF LEADER TIME SCHEDULE Historians view the 1965 Selma to The PRESIDENT pro tempore. Under Mr. FRIST. Mr. President, today, we Montgomery Voting Rights March as the previous order, the leadership time are resuming consideration of the one of the emotional high points of the is reserved. bankruptcy legislation. Under the modern civil rights movement that order from last week, at 2:30, we will began in the 1950s. f begin 3 hours of debate in relation to Yesterday, a number of Members of BANKRUPTCY ABUSE PREVENTION the Kennedy and Santorum amend- Congress went on a pilgrimage to AND CONSUMER PROTECTION ments regarding minimum wage. That Selma and marched across that Ed- ACT OF 2005 consent agreement provides for two mund Pettus Bridge. I was part of that The PRESIDENT pro tempore. Under votes to begin at 5:30 today on the Ken- delegation. I had that opportunity to the previous order, the Senate will re- nedy and Santorum minimum wage do that same march in remembrance of sume consideration of S. 256, which the amendments. the Selma to Montgomery 1965 crossing clerk will report. I do remind my colleagues that a clo- of that bridge in the past. The assistant legislative clerk read ture motion was filed on Friday, and From a historical standpoint, as we as follows: that cloture vote will occur at 2:15 on look back, we recall that 40 years ago A bill (S. 256) to amend title 11 of the Tuesday. Senators should also be aware today—actually on a Sunday—but 40 United States Code, and for other purposes. that under the provisions of rule XXII, years ago today, on that Sunday, on

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

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VerDate Aug 04 2004 04:56 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00001 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.000 S07PT1 S2112 CONGRESSIONAL RECORD — SENATE March 7, 2005 that march, approximately 600 people It was that same discipline that yes- use it on behalf of American consumers left historic Brown Chapel and walked terday now-Congressman JOHN LEWIS when there is such a demonstrable a few blocks and then went around the shared with us, as they marched from cause and effect between the price of corner and over that Edmund Pettus Brown Chapel, two by two by two, crude oil rising and the price of gaso- Bridge, going east toward Montgomery. where he and Hosea Williams led that line rising? They went on the other side of that march up on that sidewalk, dressed in Over the weekend, the Secretary of arching bridge, and they encountered their suits, recognizing that once they the Treasury, Secretary Snow, said ris- local law enforcement officers. The got over that bridge, or to the peak of ing energy prices have the potential to group of officers and some others drove that bridge, at the bottom of the hill stifle economic growth in the near fu- the marchers back across the bridge in down there, there were law enforce- ture. Maybe Secretary Snow is willing a violent episode and series of actions ment officers whom they knew in all to get on the phone with OPEC if Sec- over the next few minutes. They were likelihood would drive them back. retary Bodman will not. But I know pushed back the equivalent of several Yesterday was a gorgeous day. To be somebody ought to be doing it. And blocks over the bridge and then back to able to march arm in arm, linked that is exactly what the President of the church. across that bridge, with people like the United States promised in 2000. He The activity was chaotic. They had Congressman JOHN LEWIS and Fred said that if the country elected him, he billy clubs, tear gas. Most of us are fa- Shuttlesworth, who played such a would push OPEC very hard to try to miliar with the tragic story. That Sun- prominent role in Birmingham, and turn on the spigot and get some pricing day now has become known, since that Bernard Lafayette, a close personal relief. time, as Bloody Sunday, and thus friend of mine who now lives in Con- OPEC is making all the usual noises. today is the 40th anniversary of Bloody necticut, was a great privilege and a They are concerned, they have said, Sunday. That Bloody Sunday earned, great opportunity. about rising prices. They think the appropriately, national attention. And I share all this with my colleagues to market has plenty of oil. much of what happened in terms of the thank those who could be with us but As I said before, OPEC is going to evolution of the civil rights movement, also in recognition of today being that look out for OPEC. The question is reaching that huge landmark on Au- 40th anniversary that, yes, was called whether this administration is going to gust 6, 1965, when President Johnson Bloody Sunday, but did become a turn- stand up for the American consumer as signed the Voting Rights Act, was real- ing point and led to the rights that we they promised in 2000. If the Secretary ized. all enjoy today, but underscoring the of Energy won’t pick up the phone to Just a couple of comments about the importance of fighting for, with dis- do that, the American people deserve a course of the day. Again, it was a large cipline and nonviolence, those rights of better answer than to say, Well, gosh, I bipartisan delegation of House and justice and equality and freedom. have a whole lot on my plate. If the av- Senate Members. We arrived in Selma Mr. President, I yield the floor. erage American didn’t send their tax early yesterday morning and visited The PRESIDENT pro tempore. The return in on April 15 saying, Gosh, I two of the museums there. We then Senator from Oregon. have a lot on my plate, I don’t think went to the church service at the his- ENERGY PRICES that would be acceptable, not to this toric Brown Chapel AME, African Mr. WYDEN. Mr. President, with administration, not to me, not to any- Methodist Episcopal, Church. crude oil prices at almost $54 a barrel, body. So the excuse doesn’t wash when I had the opportunity to visit and and OPEC meeting in 9 days, I have it comes to the Energy Department’s worship in that church before, but yes- come to the floor this afternoon to duty to go to bat against high oil terday it captured me. The church urge the administration to pursue what prices. itself was packed. It is a historic they promised; that is, to stand up for We need, at home, on a bipartisan church, and there is a large balcony in our consumers who are facing high oil basis, as it relates to OPEC abroad, to the back and balconies on either side. and gasoline prices. stand up for our consumers who are As our delegation, which was prob- The news just this last weekend was faced with escalating energy prices ably 40 or 50 House and Senate Mem- not good on the pricing front as it re- that seem to go up by the day. I don’t bers, crowded in with another several lates to the American consumer. The think it is right to let OPEC run rough- hundred people, with the balconies full, Lundberg survey of American gasoline shod over the American consumer and you could not help but to imagine what retailers came out Sunday and con- we make no comment other than to it must have been like 40 years ago—41, firmed what a lot of Americans sus- say, Gosh, we have a lot on our plate. 42 years ago. In that period, that pected. The price of gas is rising high, Nine days from now OPEC is going to church became the real refuge, sense of and it is rising fast. meet. Time is ticking away. But there security for the movement that According to the survey that came is still time for the administration to evolved and really instigated, in many out Sunday, the price of gasoline has deliver on what they promised to the ways, the ability for all Americans to risen nearly 7 cents per gallon in the American people; that is, to protect vote today, culminating in that signing last 2 weeks, across the board, for all our consumers from high oil and gaso- by President Johnson later in 1965, on grades. And the Lundberg survey indi- line prices. I urge they take just that August 6, 1965. cates that this is just the beginning, action. If Mr. Bodman won’t do it, as Yesterday, in the church service, that higher prices are on the way. he indicated last Thursday, maybe Rev. James Jackson, the pastor of that Now, last week, Mr. President and somebody else in the Bush administra- church, opened the service itself. And colleagues, I asked the U.S. Secretary tion will. we had a wonderful sermon that was of Energy, Mr. Bodman, whether he I yield the floor. delivered in commemoration by the was going to do what the administra- The PRESIDENT pro tempore. As a Rev. C.T. Vivian. Reverend Vivian was tion promised; that is, to stand up for Senator from the State of Alaska, I an inspirational speaker in his presen- the consumer and try to push OPEC as suggest the absence of a quorum. tation. hard as possible to get some pricing re- The clerk will call the roll. But what was fascinating to me was lief when they meet in a few days. The assistant legislative clerk pro- it was his early participation, really, in Mr. Bodman said, in response to my ceeded to call the roll. Nashville, TN, working alongside oth- questions, that he had not made that Mr. MCCONNELL. Mr. President, I ers who were there yesterday, Con- call and, well, he had a whole lot on his ask unanimous consent that the order gressman JOHN LEWIS and so many oth- plate. I do not think that is good for the quorum call be rescinded. ers, that in Nashville that nonviolent enough. I think we have to ask this ad- The PRESIDING OFFICER (Mr. movement, and the discipline involved ministration, and the President specifi- SUNUNU). Without objection, it is so or- in that movement, was developed. It cally, about using their political cap- dered. was developed in meetings, in churches ital now to stand up for the American Mr. MCCONNELL. Mr. President, all over Nashville, TN, setting out a de- consumer who is getting clobbered by what is the pending business? fined curriculum based on the great these gasoline and oil prices. The PRESIDING OFFICER. The teachings in the Bible and from Gandhi If they are not going to use it now, pending business is S. 256 which has and so many others. when are they going to use it? Why not been reported.

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00002 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.002 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2113 Mr. MCCONNELL. Mr. President, I should not be an escape hatch to avoid frauding the system to avoid responsi- rise today on behalf of every American responsibility. A few weeks ago this bility will save America $3 billion a who each year is forced unknowingly Senate, on a bipartisan basis, passed year—a good start for reforming our to pay a hidden tax. We all know we the moderate, commonsense Class Ac- system. That $3 billion rightfully be- have to pay an income tax, a sales tax, tion Fairness Act to curb some of the longs to the American people who are a payroll tax, but what about a bank- abuses of our legal system. It was the forced to pay the egregious bankruptcy ruptcy tax? You may not have heard of first substantive bill passed by this tax. They are being robbed by an un- this tax, but you and every other man, new Congress. It was supported by scrupulous few. woman, and child in America pay it Democrats and Republicans and has It is our responsibility to end the every single year. It is the accumu- been signed into law by President fraud and abuse in the bankruptcy sys- lated cost of higher interest rates on Bush. I am very pleased that this 109th tem by passing this bill. It will credit, higher downpayments on a car Congress has started off in a tone of bi- strengthen our economy, and it is also or other essential items, and higher partisan agreement and cordiality. I the right thing to do. penalty fees and late charges for finan- think passing the Bankruptcy Abuse I yield the floor and suggest the ab- cial transactions. It is the result of the Prevention and Consumer Protection sence of a quorum. abuse of America’s bankruptcy system Act of 2005 can be the next step in fur- The PRESIDING OFFICER. The which allows people who still have the thering that sense of cooperation. Like clerk will call the roll. The assistant legislative clerk pro- ability to pay back some or all of their the Class Action Fairness Act, this bill ceeded to call the roll. debt to declare bankruptcy and escape is a moderate, commonsense bill with responsibility for what they owe. Mr. KENNEDY. Mr. President, I ask bipartisan support. It passed out of the unanimous consent that the order for Somebody has to pay those unpaid Judiciary Committee with bipartisan bills. And that somebody is you. Com- the quorum call be rescinded. support. It has passed this Senate with The PRESIDING OFFICER. Without panies have no choice but to pass them bipartisan majorities before. It should on to the consumer. objection, it is so ordered. be entirely within our power to pass it When I mention this bankruptcy tax, Under the previous order, the hour of now and send it on to the President for you may think I am talking about 2:30 having arrived, there will now be 3 small change, the kind of money you his signature. hours of debate, equally divided, on the Right now individuals have two op- can find under your couch cushions. Santorum and Kennedy amendments. tions for declaring bankruptcy. They You would be wrong. According to a The Senator from Massachusetts is may file under chapter 7, surrender Department of Justice study, the bank- recognized. their assets to be sold, and then be re- ruptcy tax amounts to a staggering Mr. KENNEDY. Mr. President, as I leased from all debt. They start again $400 for every man, woman, and child understand it, we have an hour and a with a fresh slate, leaving their credi- in America once a year every year. Let half on our side. tors unpaid. The PRESIDING OFFICER. The Sen- me repeat that so I can be sure it soaks The second option is to file under ator is correct. in. That is $400 for every man, woman, chapter 13. In that case an individual and child in America once a year every AMENDMENT NO. 44 must work with a bankruptcy court year. Mr. KENNEDY. Mr. President, I ask That amount of money would mean a and draft a payment plan to satisfy as unanimous consent that the pending lot to a family in my home State of much outstanding debt as possible, amendment be temporarily set aside. Kentucky where the median income is given the debtor’s income. The problem The PRESIDING OFFICER. Without $36,936 a year. That means the average is too many people are filing under the objection, it is so ordered. The pending Kentuckian has to work 4 days a year more lenient chapter 7, leaving their amendment is laid aside. Mr. KENNEDY. Mr. President, at to pay the bankruptcy tax. In fact, it is debts unpaid even when they have siz- 5:30, the Senate will have an oppor- the lower income families who feel the able income and sizable assets. Some sting of the bankruptcy tax the most. are choosing it as an avenue to commit tunity to vote on an increase in the Higher interest rates can stop them fraud. minimum wage, and we have not had from getting access to credit for a The bill currently before the Senate an opportunity to increase the min- home, transportation to a necessary will institute a means test to sort out imum wage for some 8 years. The pur- job, or even higher education. those who file chapter 7 but actually chasing power of the minimum wage is Our bankruptcy system was origi- have the ability to live up to their obli- now probably at its second lowest pur- nally created to give those who were gations. This is not a draconian meas- chasing level in the history of the min- hopelessly mired in debt a way out and ure, by any means. Only about 7 to 10 imum wage and is deteriorating every a second chance. As long as it was used percent of chapter 7 filers will be single day, in terms of purchasing sparingly and applied only to those screened out by the means test which power. who most needed its mercy, it was the will be administered by a bankruptcy These individuals that work at the compassionate way for America to court. minimum wage are hard-working indi- make sure that none of her neediest be- Any debtor who earns less than their viduals, men and women of great came trapped in a lifetime of deficit State’s median income—and that in- pride—primarily women, and women and despair. But in recent years, too cludes about 80 percent of the debtors with children, and in many instances many are abusing the bankruptcy sys- in question—will remain in chapter 7. men and women of color. Historically, tem. Last year nearly 1.6 million indi- Those earning more than the State me- this issue has not been a partisan issue. viduals filed for bankruptcy, a record dian income will be allowed to deduct Republicans and Democrats have high. This number is five times greater certain obligations and expenses from joined together to raise the minimum than the number of individual bank- their net worth, thus allowing some of wage because we have believed as a ruptcy filings 20 years ago. them to also remain in chapter 7. And country and as a society that work is It seems odd so many more Ameri- anyone left will be able to show special important, work should be rewarded, cans would choose bankruptcy over circumstances for why they should be and that men and women who work that 20-year period, especially when allowed to still file under chapter 7. So hard, 40 hours a week, should not have you recognize that the last 20 years there will be plenty of opportunities to live in poverty, particularly those have set new records for economic for the neediest among us to file chap- who have children. Nonetheless, we growth, low unemployment, and low ter 7 and use the safe haven of bank- have seen that those millions of work- interest rates. The answer to this mys- ruptcy as it was originally intended. ers who work hard and work at the tery is fraud and abuse of the bank- Those remaining will be required to minimum wage have been falling far- ruptcy system. In fact, the FBI has es- file under chapter 13. It is not too ther and farther behind. timated over 10 percent of all bank- much to ask people to pay back what People can ask, why is this relevant ruptcy filings involve at least some they owe when they clearly have the to the bankruptcy bill? In fact, a third fraud. means to do so. And those who are of all bankruptcies take place from Bankruptcy was created as a ladder abusing the system will be exposed. people who have income below the pov- to greater economic opportunity. It Catching the individuals who are de- erty level.

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00003 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.004 S07PT1 S2114 CONGRESSIONAL RECORD — SENATE March 7, 2005 What we see on this chart is the fact class action bill, they pulled the class Bush, Franklin Roosevelt, John Ken- that the real minimum wage has fallen action bill because they did not want nedy, Lyndon Johnson, Jimmy Carter, now to just about $10,000 a year for a to vote on an increase in the minimum and Bill Clinton. It has been bipartisan family of three. It is about $5,000 below wage. over the period of history. the poverty line. If you are able to get So we find that Americans are work- It is baffling to me why in the world individuals up so they have more pur- ing harder; we find a dramatic increase we cannot get an increase now. What is chasing power, particularly against the in productivity; we see explosions in the reason? What is the reason we hear background which has seen an explo- cost; we see the purchasing power of so much about values? Don’t we figure sion of health care premiums, housing the minimum wage going down to its that working hard is a value in our so- costs—in my own State of Massachu- second lowest level; and we see that so ciety? Don’t we think that rewarding setts, we have the second highest hous- many of these individuals who are work is a value in our society? We will ing costs of any State in the country. below the line of poverty end up in find out this afternoon. We will find The cost of the general standard of liv- bankruptcy. out this afternoon, at 5:30, whether our ing has put enormous pressure on these This is just the background. There colleagues think that rewarding the individuals that are hard-working and will be those who will say we cannot men and women who work hard, not are at the lower end of the economic really afford to have an increase in the just on one minimum wage job but ladder. So this has a direct relevancy minimum wage because it is going to often two or three minimum wage jobs, to the bankruptcy bill—trying to raise add a great deal to the problems of in- is a value. individuals to a point where they are flation. Right? Wrong. A principal, in surveys of children of going to be able to meet their financial First of all, this chart indicates ex- these minimum wage workers, asked obligations; that is extremely impor- actly what the impact of the increase the children what their biggest com- tant. We have seen, as I just men- in the minimum wage is in our budget. plaints are. It is not that they are not tioned, over the period of these past 5 All Americans combined earn $5.4 tril- able to get Christmas presents at years what has happened with health lion a year. A minimum wage increase Christmastime. It is not that they can- insurance, college tuition, housing, and to $7.25 would be less than one-fifth of not afford to buy a birthday present for gasoline. 1 percent of national payroll. Do we un- a fellow student’s birthday. It is not Most of these minimum wage work- derstand that? The payroll is $5.4 tril- that they cannot afford any skates to ers have no such thing as health insur- lion a year and we are talking about be able to join the other children skat- ance, few are able to save for college less than one-fifth of 1 percent. This ing. It is that they say they don’t see tuition, housing has gone up dramati- doesn’t have an adverse impact on in- their parents enough. They don’t see cally, and many of them are dependent flation in terms of this country. We their parents enough. There is not upon driving in order to get to avail- have seen from the various studies, enough time with their parents. That able jobs. So they have been enor- which we will refer to later, that nei- is repeated time in and time out, again mously impacted by the increase in ther does it have in terms of employ- and again, as one of the primary con- costs. We have seen that four million ment. cern of the children of minimum wage more Americans have gone into pov- This is an issue, ultimately, about workers. erty over the last 4 years. As a result of fairness. That is why this is so impor- Here we are debating the bankruptcy the census, more than 1 million more tant. It is interesting that this Con- bill that has been written by the credit children have gone into poverty over gress has not hesitated to vote itself a card companies, which have $30 billion the last 4 years. pay increase during this period of time, in profits this year and are looking to These statistics tell the story. What but not for the minimum wage earners. collect billions of dollars more as a re- also tells the story is this chart, which The height of hypocrisy will be this sult of this legislation. That is going to shows that Americans’ work hours afternoon. The height of hypocrisy will turn our bankruptcy courts into col- have increased more than any other in- be this afternoon when those individ- lecting agencies for the credit card in- dustrialized country in the world. This uals in the U.S. Senate say no to $7.25 dustry. And we are going to say, oh, no, chart indicates, using a baseline, what an hour for hard-working Americans no, we cannot afford $7.25 for working has happened from 1970, the last 30 after they have accepted a $28,500 pay men and women. years, in terms of people working. We increase for themselves over the last 8 We can afford billions of dollars for found out that Americans are working years. the credit card companies—and I mean longer and harder than in most other Do you understand that? They have billions of dollars, probably the most industrial nations in the world. What been willing to vote on a pay increase profitable industry in this country— we find is that they are working longer for themselves, and we will find out but we cannot afford to have an in- and harder and, look at the results of whether they are going to vote for crease in the minimum wage. No, it working long and hard. They are pro- hard-working Americans who are try- adds to the payrolls of companies. It is ducing more but making less. The in- ing to make ends meet and provide for going to be inflationary. Why are we crease in terms of productivity has their families and their children. setting a minimum wage? Let these been anywhere from 25 to 30 percent It is as stark as that. That is what people work harder. American workers. Do you think that happened. This is where the minimum At 5:30 p.m., we are going to have two has been reflected in any increase in wage has been since the last increase in votes. One is going to be to increase the minimum wage? Absolutely not. 1997. It has been flat over all these the minimum wage to $7.25 an hour in That is because Congress has been un- years—but not for the Members of Con- three steps: 70 cents 60 days after en- willing to increase the minimum wage. gress. You can understand why Mem- actment, 70 cents a year later, and 70 As a matter of fact, when I offered this bers don’t want to vote on increasing cents a year after that. My friend from legislation even on the welfare bill, the minimum wage; it is because of Pennsylvania has offered an alter- which my friend and colleague from that. native amendment, the Santorum Pennsylvania says is where it belongs, It is not very surprising to me be- amendment. For those who are giving the legislation was pulled last year, cause we had an increase under the some thought to the fact that maybe rather than having a debate and vote first President Bush. We had an in- going to $7.25 is a little bit too much, on an increase in the minimum wage. crease in the minimum wage under maybe the Santorum amendment I offered it on State Department re- President Ford and one under Presi- makes more sense. I hope they will lis- authorization because the other side— dent Eisenhower. We have had it in a ten to me now. the Republican leadership—would not bipartisan way throughout history. But The Santorum amendment gives half give us an opportunity or a vehicle on absolutely not now. The Republican of the increase to minimum wage which to consider this legislation, or leadership in the House of Representa- workers with one hand and then—lis- by itself, so it was necessary to try to tives and the Senate of the United ten to me—takes away minimum wage, amend existing legislation. They said, States says, no way. This is the record overtime, and equal pay rights from oh, no, and they pulled that legisla- of where we have seen it: Dwight Eisen- over 10 million workers with the other tion. When I offered it last year on the hower, Jerry Ford, the first President hand. It takes just one page of the

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00004 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.006 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2115 Santorum amendment—here is my are going to find out they are going to times in the last Congress, the Repub- amendment, Mr. President. It is three get a real pay cut. That is what is in lican leadership brought down a bill pages to raise the minimum wage to the Santorum amendment. rather than let us vote on it. So their $7.25. Here is the Santorum amend- The Santorum amendment also pro- actions speak louder than words. ment—85 pages. If he was only raising hibits States from providing stronger A week ago, our Republican friends the minimum wage half of what I pro- wage protections than the Federal Gov- were touting their so-called anti- pose, he would be able to do it in three ernment for waiters, waitresses, and poverty agenda. But as we see with pages, too. That ought to say some- other employees who rely heavily on their agenda, what they really are thing to our colleagues. their tips for earnings. Do we under- doing is creating a deeper poverty What else is in the amendment? It is stand that, Mr. President? The agenda. If they are truly serious about extraordinary. It takes one page, as I Santorum amendment puts the long helping hard-working families rise mentioned, to raise the minimum Federal arm right at the throats of the above the poverty line, they will sup- wage, and 84 pages are special interest States and tells them there is no way port our amendment to give a fair raise giveaways that take rights away from they can provide the extra reimburse- to America’s low-income workers. workers. ment to these workers. It is shameful that in America today, The Senator from Pennsylvania has a In the State of Pennsylvania, em- the richest, most powerful Nation on record of opposing the increase in the ployers are required to pay their tipped Earth, nearly one-fifth of all children minimum wage, and I understand that. employees $2.83 an hour. Yet this go to bed hungry because their parents That is his record. He has voted amendment would deny the hard-work- are working full time at the minimum against it at least 17 times in the last ing waiters and waitresses the 70 cents wage and still cannot make ends meet. 10 years, so today is really no different. an hour employee-provided wages. That That is a key part of any real anti- The Santorum amendment will in- is not true in every State, but Pennsyl- poverty agenda: ending childhood pov- crease the minimum wage by $1.10 vania made that decision. And here on erty. But the Republican proposal will cents an hour. It will benefit 1.8 mil- the floor of the Senate is an amend- actually plunge even more children lion workers. Do we understand that— ment to deny the people of Pennsyl- into poverty. 1.8 million workers. He goes up to $6.25. vania from carrying forward their judg- Mr. President, 3.4 million children Ours goes to $7.25 and benefits 7.3 mil- ment. have parents who would get an imme- lion directly and an additional 8 mil- Mr. President, 22-year-old Julie Phil- diate raise under our proposal. Hun- lion more Americans; 3.4 million of lips in Johnstown, PA, is working two dreds of thousands of those children those are parents with children. But part-time jobs—one at minimum wage will be left behind by the Santorum Santorum benefits only 1.8 million. He making $5.15 an hour and another as a amendment. The poison pills in the is not just saying we will take $6.25 in waitress at a Chinese restaurant. This Santorum amendment will be particu- place of $7.25; we only want that. Oh, amendment would deny Julie 70 cents larly harsh for children. Think about no, he is only covering 1.8 million. an hour in wages from her minimum the single mother with two children That is enormously important. wage job. She would have to rely on working as a waitress in Minnesota. So what does he do? The Santorum unpredictable tips from her second job Under the Santorum amendment, she amendment makes more than 10 mil- instead. will lose her guaranteed right to the lion workers no longer eligible for the The amendment also gives a free pass minimum wage, leaving her paycheck minimum wage, no longer eligible for to violators of a broad range of con- smaller and her children less secure. overtime pay, no longer eligible for sumer, environmental, and labor pro- Think about a garment worker work- equal pay rights by repealing the indi- tections by prohibiting the Federal ing 80 hours a week to provide for her vidual coverage under the Fair Labor agencies from assessing civil fines for family. Her husband, a janitor, relies Standards Act and raising the thresh- first-time reported violations. It also on overtime as well to pay for food, old to $1 million a year from $500,000. preempts the ability of States to en- rent, and clothes for their children. Those workers who work in the small force these laws. The States are enforc- They will lose their overtime coverage stores that are involved in interstate ing these laws, but under the Santorum under this amendment, and both par- commerce who are covered under min- amendment, they will be denied the op- ents will take a pay cut. Some anti- imum wage, not under Santorum, are portunity to enforce those laws. Those poverty agenda. excluded. If there is a State minimum laws are there to protect the workers, According to the Families and Work wage, they are covered. We have a but he preempts the ability of States Institute, among the most important number of States that do not have any to enforce these laws. aspects children would most like to minimum wage whatsoever. Then he Once again, we are on the Senate change about their working parents are raises the level from $500,000 to $1 mil- floor with legislation written by spe- these: They wish their parents were lion as a threshold for the coverage. cial interests which will help them the less stressed out by their work; they This is what he does: By eliminating most. The bankruptcy bill was written wish they were less exhausted by their the individual Fair Labor Standards by the credit card companies, the class work; and they wish they could spend Act coverage and raising the business action bill was written by corpora- more time with them. But this amend- exemption to $1 million, the Repub- tions, deceiving and overcharging their ment will deny overtime for more than lican proposal jeopardizes worker pro- customers, and now we have the min- 10 million workers, leaving them less tections for over 10 million workers. imum wage bill written by the res- time to spend with their children. Those workers will lose minimum taurant industry and retailers looking What is more, this amendment would wage, overtime, and equal pay protec- for a way to fatten their bottom lines. tie the hands of Federal and State tions. If the Republicans were truly inter- agencies trying to enforce the Federal What do I mean by they lose over- ested in raising the minimum wage, laws that protect families, children, time? This is what the Santorum they would not have loaded their pro- and communities. It weakens the gun amendment does. Under current law, if posal with these antiworker poison safety protections under the Brady the employer wants to work out flexi- pills that are special interest give- Act, which could lead to an increase in ble time with their employees, they aways. It is hard to believe our Repub- weapons sales to criminals, jeopard- can do it as long as it is done within lican colleagues are serious about this izing our neighbors and children’s safe- the 40-hour workweek. That is all le- thinly veiled attack on low-income ty. It weakens environmental laws that gitimate and fair. But under the cur- workers. require companies to disclose their rent law, if an employer wants to work There are many ways to help small toxic emissions. It weakens reporting a worker 50 hours this week and 30 businesses without denying rights to requirements under the Clean Water hours the next, they have 10 hours of millions of minimum wage workers. We Act and Safe Drinking Water Act. It overtime. Under the Santorum amend- worked together in the past to provide undermines consumer protection laws ment, they can work 50 hours one week reasonable small business tax relief, that require companies to report on and 30 hours the next and no overtime. along with the minimum wage. I would the safety of their food. These provi- This affects millions of workers who be willing to do that again. Three sions put all Americans, especially

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00005 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.007 S07PT1 S2116 CONGRESSIONAL RECORD — SENATE March 7, 2005 children, at risk of increased exposure crease are women and one-third of of the market, what mechanisms we to pollution, toxic substances, and seri- those women are mothers. The min- might have to deal with that fact, but ous illness from unsafe foods. imum wage is so low today that many it is an economic fact and the pro- We teach our children the impor- workers have to work several min- ponents of raising the minimum wage tance of hard work. We encourage them imum wage jobs in order to make ends like to dismiss this by saying, well, we to do their best in school and be good meet. have a hard time measuring it, or the citizens. We tell them their reward will Look what our program will do: economy is large, or we have not been be good jobs that fulfill their hopes and Raise the minimum wage to $7.25. That able to measure significant increases dreams and enable them to support is $4,400 to a minimum wage family. in inflation as a result of increasing healthy families. That is what America That is 2 years of child care. That is the minimum wage. is about. But for the 36 million Ameri- full tuition for a community college. I am not talking about inflation nec- cans who live and work in poverty That is a year and a half of heat and essarily or economic growth. I am talk- today, that dream is unfulfilled. They electricity. It is more than a year of ing about the workers themselves who work as hard as any American—often groceries. It is more than 9 months of are priced out of the market, and if one harder—but too often they are forced rent. That may not sound like a lot for does not believe that or they want to into bankruptcy because the minimum people around here, but that means a dismiss the economics, think about wage will not cover their bills and give great deal to the people who can ben- this: If there was not an economic im- their families the support they need. efit from this. pact, why are we not debating raising We can no longer turn our back on History clearly shows that raising the minimum wage to $20 an hour? our fellow citizens, but that is exactly the minimum wage does not have a Well, the answer is obvious. Because what is happening in the Senate. Rais- negative effect on jobs, employment, or if the minimum wage were raised to $20 ing the minimum wage is critical to inflation. In the first 4 years after the an hour, even the proponents of the preventing the economic free-fall that last minimum wage increase, the econ- Kennedy amendment would have to often leads to bankruptcy. Amending omy had its strongest growth in three admit it would be cost prohibitive. the bankruptcy bill to increase the decades. More than 11 million new jobs Thousands, if not millions, of people minimum wage will help many of the were added at a rate of 200,000 a month. would be priced out of the market. The people this so-called reform is likely to Compare that to the 530,000 private sec- number of jobs would shrink. Certainly hurt: low-income families, minorities, tor jobs lost since this administration the number of entry level jobs would be and women. took office. reduced. As I mentioned, nearly a third of Minimum wage will not cause more Oh, but they say, we are not pro- those who file for bankruptcy are in job losses, but staying the course on posing raising the minimum wage to poverty at the time they file. That is failed economic policies will. Over- $20 an hour because we know that is half a million families who are already whelming numbers of our fellow citi- not a good idea. Well, then why are living below the poverty line and will zens in Nevada and Florida showed the they not proposing to raise it to $10 an be plunged into further hardship with way last November by voting for a hour? Because at $10 an hour they this bankruptcy bill, and many of them higher minimum wage in their States. would still have to admit the negative are minimum wage earners. It is time for the Republican Party to economic effects on prices and on the In the current economy, millions of stop obstructing a fair increase in the total number of jobs, especially those Americans are suffering: 8 million are minimum wage for all employees at the entry level that would be priced unemployed, 45 million are without across the Nation, and I hope that our out of the market. So instead they health insurance, and 13 million chil- Members would support this. seek a lower level where the negative dren live in poverty. Poverty has dou- I ask unanimous consent that Sen- consequences are much more difficult bled for full-time, full-year workers ators LIEBERMAN, DURBIN, SARBANES, to measure but they still exist, because since the 1970s. Minimum wage employ- and HARKIN be added as cosponsors to it is an economic fact of life that when ees work 40 hours a week, 52 weeks a the amendment. the minimum wage is raised, people are year, and they deserve to be fairly The PRESIDING OFFICER (Mr. MAR- being priced out of the markets. paid. TINEZ). Without objection, it is so or- The same economic fact is true for Low-income families are being dered. $8, $7, or $6 an hour. People are being squeezed in every direction by the The Senator from New Hampshire. priced out of the market. I think this economy, and families are just barely Mr. SUNUNU. Mr. President, I rise to is most disturbing because those priced balancing on a cliff of piling bills, hop- oppose the Kennedy amendment. I ap- out of the market are the very ones ing they will not topple over. Their preciate very much the Senator’s re- who most need the opportunity. They costs are rising but not their wages. marks and his commitment and pas- are entry level workers. They are first- To make matters worse, the credit sion on this issue, but I did want to time job seekers. They are people mak- card companies prey on low-income make a couple of brief points before ing the transition from welfare to work workers. They know these workers are Senator SANTORUM, who is offering an and they are teenagers experiencing desperate. They offer loans at exorbi- alternative, has a chance to talk about their first time in the labor force. They tant interest rates that are made to the provisions of his amendment. are the ones who most need that job seem cheaper than they are by three of While I appreciate the belief of the opportunity to build a foundation to the most deceptive words in the Senator from Massachusetts, I do develop the experience that will enable English language: minimum monthly think it is important to take a step them to earn even more money in the payment. back and allow this debate to include a future. While workers struggle, credit card sense of what the deeply held concerns If one does not believe that, they can companies reap skyrocketing profits are about raising the minimum wage, go to any small business and ask them from their hardships. This is not only because it is not all a single-sided if they are hiring in at minimum an economic issue, it is a family issue story. I do not support the Kennedy wage—and there are very few firms and women’s issue. Divorced women amendment because I do not support that do hire in at minimum wage, but are 300 percent more likely than single raising the minimum wage, and the if they do, how long those employees or married women to find themselves reason is as follows: When the min- actually earn at the minimum wage in bankruptcy court, often because imum wage is raised, workers are level. It is not long because once a per- they are owed child support or alimony priced out of the market. That is the son has shown 3, 4 or 6 months of abil- and cannot collect it. They are trying economic reality that seems to be ity in a role with an employer, their to raise their children but they face a missing, at least so far, from this dis- value has been proven and they are daunting challenge. This bill will make cussion. very quickly going to move above it harder for them to meet that chal- When the minimum wage is raised, whatever the entry level threshold was. lenge. some workers are priced out of the Those who are going to be priced out Sixty-one percent of those who will labor market, and we could have a dis- of the labor market by an increase in benefit from the minimum wage in- cussion about how many are priced out the minimum wage are those who most

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00006 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.008 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2117 need that first job opportunity, and because the economics hurt the very gages and all the other things that that is why I strongly disagree with individuals who most need these entry were going on during the time. That the Senator from Massachusetts and level, first-time job opportunities. set the wages at a very high level. So his amendment. The impact may be They are certainly wrong with the idea look at how we are providing a respon- small, and our economy is $11 trillion. that setting prices for labor, setting sible floor for workers without having, It may only be 10 jobs that are affected prices for goods and deciding whose as Senator SUNUNU suggested, an im- or 20,000 or 30,000 who never get that work has value and whose work does pact on the economy, which could be first job opportunity at a job. Unfortu- not have value should start in Wash- inflationary and damaging to all work- nately, it is very difficult to measure ington, D.C. That is not the way our ers, as well as, particularly, lower wage 10,000, 20,000, or 30,000 jobs in an econ- market economy works. workers, looking at high rates of infla- omy the size of America’s, but it is I yield the floor. tion, as well as making sure we do not there. The economic consequences are The PRESIDING OFFICER. The Sen- disadvantage businesses by pricing real. Again, if one does not believe it, if ator from Pennsylvania. them out of the ability to have work- they believe there are no economic Mr. SANTORUM. Mr. President, I ers, and also pricing laborers out of the consequences, then they should be will- rise to offer an alternative to the Ken- marketplace. ing to step down to the Senate floor nedy amendment on minimum wage. I When you have extraordinarily high and offer an amendment to raise the listened in part to my colleague from rates, as Senator SUNUNU suggested, minimum wage to $20 or $30. Or why Massachusetts describe that. Obviously $20-an-hour, $30-an-hour minimum even stop there? I have a slightly different take on what wage, you are going to be pricing a lot One final point I do want to make is my amendment does than the Senator of people out of the workforce. in regard to a phrase that was used by from Massachusetts suggests, and I I think what we are suggesting is a the Senator from Massachusetts. It will go through that point by point and responsible approach. It keeps up with was a question or a phrase about re- point out where the Senator from Mas- the tradition over the past few years of warding work. The question was sachusetts may have exaggerated some a responsible floor for a minimum whether we were willing to stand up in of the claims about what destruction wage. I am very comfortable that our the Congress or, I suppose, the Senate this amendment would do to workers proposal keeps the balance between the in particular, and reward work by sup- in my State or any State. ability of lower skill employees to porting an increase in the minimum I start out by suggesting why I am enter the workforce at a wage in which wage. offering an increase in the minimum they are compensated for the skills I have a concern about this phrase wage. On this first chart it is impor- they bring to the job, and at the same because it suggests that as Federal leg- tant to see this green line which is the time not forcing employers—because, islators it is our job to reward work. percentage of hourly workers who are again, see, we are pretty far down on That may sound nice, but it suggests paid the minimum wage. Since the the number of people working at this that it is our job to set prices, that it minimum wage was instituted—actu- level—not forcing employers to forego is our job to set wages, that it is our ally not since it was instituted but in employment with people in that slight- job to decide whether the work any cit- the last 25 years we can see that the ly increased amount we are suggesting. izen is doing in the economy, in the percentage of workers now covered by So it is not going to hurt employment, private sector, is worth a particular the minimum wage is actually the low- it is not going to hurt their businesses amount of money, whose work is worth est it has been in quite some time. It is dramatically, and to the extent it does, more than someone else’s and what 2.7 percent of hourly paid workers who as Senator KENNEDY, at least, described kind of rewards does the Federal Gov- now get paid the minimum wage. When the provisions—I don’t know that he ernment give the taxpayer for doing one looks at that number, it sort of accurately described the provisions— their job. That is not the role of the cries out a bit and says it is time to we do have provisions in the legislation Federal Government. We should not be bring it back up to be not the absolute that deal with the smaller businesses. deciding who gets rewarded for work, bottom where no one is paying that It is a general rule in the Federal whose work is of value and whose work and there is effectively no minimum Government that we have lots of re- is not of value. wage—very few people are paid it—to a quirements—family and medical leave In fact, there are few countries left point which sort of comports with at is one example, but there are others, on Earth where the central government least recent history. That is what we labor laws—that exempt small busi- has the responsibility of rewarding are trying to accomplish with our nesses. We either do it by the number work in and of itself, and those are amendment, which is to bring it back of employees or, in the case of the Fair countries such as Cuba and North up to about here. Labor Standards Act, by the amount of Korea that decide only the federal gov- Our $1.10 increase over a period of 2 revenue that employer happens to take ernment should be able to determine years would cover about 7.4 percent of in. what one earns or does not earn, how all workers, which is actually slightly In this case, we do raise the cap from much one can charge and or not charge higher than it has been over the last 15 $500,000 of revenue for your business as for a given good. Our job is to pass years and is a little above historic being exempt from this provision to good legislation that creates an eco- trends. Senator KENNEDY’s increase $1.2 million. That provision was set, by nomic environment where people have would actually put it to about almost the way, back in 1990. If you would incentives to commit capital to start 17 percent of workers in the economy have indexed that for inflation, it businesses to create economic oppor- who would be making minimum wage, would be $1.5 million today. So we are tunity and to create jobs and a good which at least going back to the 1970s not even keeping up with inflation. We quality of life. would be much higher than it has ever are actually well below inflation in the It sounds nice to say we should re- been as a percentage of wages. proposal that is being put forward, but ward work in the Senate, but the only So I think what we are suggesting is we are capturing more small businesses way to do that in passing Federal legis- something that comports with the cur- that are not affected. lation is to start and to try to set rent economy, certainly the way the This just affects the States that sort wages, to try to set prices, and to try economy has worked over the last 20- of tie their minimum wage laws to the to control the levers of the economy. plus years, as opposed to something Federal laws. If you have a State that We have seen where that slippery slope that harkens back to long ago days has no minimum wage—I think there can be taken. We do not have to look where this was not just a minimum, it are six or seven of those—they would farther than the former Soviet Union actually had, as Senator SUNUNU sug- stay at the $500,000 level. We left that and the former eastern European coun- gested, a dramatic impact on the econ- provision in place, in a sense to protect tries that have rejected that kind of omy and a potentially very infla- workers because the States have not centralized state economy. tionary impact if one looks at where spoken on this. But for States that are I appreciate the passion and the com- the wages were of this percentage of tied to the Federal level, we raised it. mitment of those on the other side. I payroll and we have hyperinflation. Obviously, if the States want to go think they are wrong on the economics You remember the 20-percent mort- back, they are certainly welcome to do

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00007 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.009 S07PT1 S2118 CONGRESSIONAL RECORD — SENATE March 7, 2005 so. But it does provide an exemption to the mom who has two kids, who 40 hours a week and deny them all of for smaller businesses—those that are needs some help from the Federal Gov- these—I will not repeat it. Read the mom-and-pop stores, those who are ernment to be able to support those transcript. Read the Senator’s argu- just starting to build their business— children. ments about how devastating this from the Fair Labor Standards Act. This is much more targeted relief, if would be to people, to have flextime It is important to understand. There you will, than the blunt instrument of imposed upon them. are other things I will go through, but a minimum wage increase. No. 1, this provision as written does before I move off into the other areas Having said that, in this chart you not impose anything. What it says is of the bill I want to talk about how im- see a decline—go all the way back to that the employer and the employee portant it is not to dramatically in- 1939. You see the earned-income tax have to enter into a written agree- crease the minimum wage the way Sen- credit comes in and you see the dif- ment, where both have to sign, to agree ator KENNEDY has suggested. ference it makes up here recently. We that the employee will work more What we have seen about overtime is are suggesting to bring it back up by hours in 1 week—no more than 10 in ad- that this is where we are today with $1.10. If you add $1.10 to $7.22, you are dition to the 40 hours, in exchange for the real value, if you add in a combina- at $8.32, which would be higher than it commensurate hours off the following tion of the minimum wage and the has ever been with the combination of week. Again, it is mutual agreement. It earned-income tax credit. Why do we earned-income tax credit and minimum has to be in writing. Of course, the em- say the earned-income tax credit? You wage. ployee can decide to withdraw himself heard the Senator from Massachusetts So, again, to suggest somehow or an- or herself from that agreement. talk about trying to support a family, other, as the Senator from Massachu- I happen to believe that flextime is a trying to make a living. I am sure he is setts suggested, that his increase that good thing. We have several employees not going to go out and try to argue for would bring it off the chart, if you will, in my office who job share, who use the teenage son of a wealthy business- is a responsible increase—it is a blunt flextime. Federal employees have been man, that we have to make sure they instrument that would benefit teenage able to use flextime for a long time. It earn a minimum wage because that kids of millionaires much more than it is something that is very popular in wealthy businessman’s son needs the would benefit these moms here. Why? the Federal workforce. What we are money. He may need it in his own Because as you get into the higher in- trying to do is make it available to right, but that is not the purpose of the come area, the earned-income tax cred- others outside. Why? I can tell you an minimum wage. That is not what it is it goes away, it starts to phase out. So example in my own office. The people for. this blunt instrument of the minimum who job share and have flexible hours The argument for the minimum wage wage helps folks who are not the point are moms who are in the workplace. is we have to make sure those out of what a minimum wage is all about. Obviously, we have seen a dramatic there in society whom the Senator When people come out here and say change in the workplace in the United from Massachusetts talked about—the they need the minimum wage, they States since the minimum wage laws young lady in Johnstown, PA, making don’t talk about the son of the wealthy and the 40-hour workweek was put in sure she had coverage. By the way, the businessman as the point. They talk place. This entry into the workforce of provision we authored that Senator about this mom. Increasing the min- nontraditional workers, if you will, has KENNEDY said applied to her with the imum wage, yes, helps everyone—if you given rise to a lot of workers seeking tip credit doesn’t apply to the State of want to say ‘‘helps.’’ Obviously, it will to have their hours reflected with their Pennsylvania. It is written specifically hurt many because they will not be obligations at home. What we are try- to exclude States that have spoken on able to keep their job at this high rate ing to do is have the laws of the Fed- the tip credit. It is only those that of pay, for the maybe low skills that eral Government reflect the changing have not that this covered. So the the employee may bring to the busi- dynamics in the workplace without young woman in Johnstown, PA, is not ness. forcing anybody into a situation where covered by the provision. So the exam- But here is what we do. What we do they are not getting fairly com- ple given by the Senator is inaccurate. is balance it. We raise it slightly to pensated. But, again, going back to the central bring the level up to at least this level, But as I talked to I don’t know how point, which is what are we trying to which is where it was several years ago many parents who are friends and accomplish with the minimum wage, when we last raised the minimum neighbors and constituents, they sug- what we are trying to accomplish is wage, without affecting employers and gested to me the most important thing helping those people trying to support the ability for low-skill workers to get they would like to get out of the work- a family or themselves out there work- the jobs they need and to hold on to place is more flexibility and more time ing at low-wage jobs, welfare-to-work— them and not to disproportionately to be able to do the things that their that is the example that is used. I am benefit a lot of workers out there mak- other job—most people think their someone, in my office, who takes that ing minimum wage who are not the more important job, and that is being a responsibility of making sure those point of the minimum wage, and that husband or a wife or a father or a who are on welfare have opportunities is folks who are doing so sort of as a mother—requires them to do at home. The most amazing thing is the Sen- for employment and, in fact, in my of- side line and are not in need of Govern- ator from Massachusetts opposes this. I fice we have hired, over the course of ment interference in the market to know many who are supporters of the my time in the Senate, eight people off make sure that they have plenty to eat Kennedy amendment and oppose this, of welfare-to-work. I take that respon- and a place to sleep. also. We just went on to the AFL–CIO sibility as an employer, and also going It is a much more surgical attempt. I Web site and just pulled off some out and talking to employers about the think what we are attempting makes a things. This is their Web site. You can importance of giving people who are lot more sense, to help those in need read the small print, the exact Web transitioned off of welfare, trying to more directly, more surgically, than page: make a living for themselves and their the blunt instrument the Senator from families, the opportunity to do so. Massachusetts has suggested. I encour- Alternative work schedules encompass One of the ways we have done that is work hours that do not often necessarily fall age our colleagues, when they look at inside the perimeters of the traditional and through the earned-income tax credit. our amendment, I encourage Repub- often rigid 8-hour workday or 40 hour work What the earned-income tax credit lican and Democrat colleagues to look week. Such schedules allow working people does is target those who are trying to at what we want to accomplish. to earn a paycheck while having the flexi- sustain a family. It helps them by Let me talk about another provision bility to take care of children, older rel- building, on top of the minimum wage, the Senator from Massachusetts atives and other needs. some Federal support. But it is tar- seemed to focus on quite a bit, which is The AFL–CIO says they want that, geted support. That earned-income tax the issue of flextime. The Senator from and we are providing that. And all of a credit doesn’t go to the teenager who is Massachusetts talked about how flex- sudden, maybe because we are pro- claimed on his father’s income taxes time in this legislation is going to viding it, maybe because it is in a Re- who is a wealthy businessman. It goes force workers into working more than publican alternative, maybe this is not

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00008 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.011 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2119 a good idea. Again, this is right off the ment and would allow this amendment There are other provisions in the bill AFL–CIO Web site: to the minimum wage laws to be of- that I certainly want to talk about a Changes in the workforce and in the kinds fered at a different time. I think we are little later. But we have other speak- of hours people work are making alternative marking up the welfare reform bill this ers. I don’t want to use up all the time. work schedules increasingly important for week. It is an extension of the 1997 act. With that, let me yield the floor. working families trying to balance job and It is an appropriate place, in my opin- The PRESIDING OFFICER. The Sen- family responsibilities. ion. We are talking about welfare-to- Suggested family friendly provisions: Com- ator from Massachusetts. pressed work week. work, and we are talking about helping Mr. KENNEDY. Mr. President, I will Common examples of things asked are low-income individuals transition into take a moment or two to respond to schedules that allow workers to work eight the workplace and providing them with my good friend from New Hampshire 9-hour days and one 8-hour day for an extra a quality of life that is family sus- and then also to the Senator from day off every 2 weeks. taining. I was hoping the Senator from Pennsylvania with regard to the points Under the provisions we have in this Massachusetts would wait until that they have made. law, that is exactly what we have, al- time, and maybe we could sit down and First of all, I will respond to the Sen- lowing a mother or father who wants to work out some sort of compromise that ator from New Hampshire about the stay at home instead of working 10 8- the President would sign. During the question of whether the increase in hour days a week, work 9 10-hour days. campaign, he talked about his willing- minimum wage is really good for low- Work extra hours the days that you ness to sign a minimum wage proposal income working people and whether work for the day off. Again, that is not similar to what I put forward. I don’t this isn’t going to create more prob- allowed under the current law. We think he would support what the Sen- lems for working people because of the would have provided that flexibility. ator from Massachusetts proposed. increase in the minimum wage. Again, it would be upon a mutual If you want to actually do something He mentioned, if this was such good agreement of both the employee and to bring this level up, and do it in a medicine—$7.25—why aren’t we going the employer. sort of targeted way that actually for $20 or $25? The obvious simple an- Look, there are some suggestions as helps the people you are really wanting swer for that is we are talking about a to how we can make this more explicit, to help focus on—that is, those who are minimum wage, we are not talking although from everything I read it is trying to provide for themselves and about a maximum wage. very explicit in the legislation as to their families, not working summer I haven’t even gotten into discussing how that would work. I am certainly jobs or part-time jobs or going to what has been happening at the upper happy to sit down and talk with the school; that is really what we are fo- end of the economic ladder and the sto- Senator from Massachusetts and see cusing on—we can do that in a way ries over the weekend that showed the what we can work out in the future. that I would argue does not have a poi- bonuses are going to the wealthiest in- What we do in these provisions—yes, son pill attached to it. dividuals in the corporate world. They we do provide some tax benefits for I take great exception to what the have increased astronomically in a pe- smaller businesses. We allow for small Senator from Massachusetts said. riod of the last few years. business expensing. We allow for res- These are not poison pills. These are Since the midthirties, we have had a taurants to be depreciated. Again, who responsible, proworker, pro-small-busi- minimum wage because we believed as is going to be affected by this predomi- ness provisions that greatly help the a matter of social justice men and nantly? It is going to be the restaurant people in this new and dynamic work- women who are going to work in this industry that pays employees at this place of America. It is a very different country and have families should at level, and the travel and tourism indus- one than when the 40-hour week was es- least have some minimum standard, try. Those are the folks who will be tablished. some minimum safety net; that this so- most affected. Those are the ones paid The Senator wants to offer his ciety is not the society of survival of at the lower end of the wage scale. So, amendment and lock in a vote. But I the fittest, but it is also a ‘‘we’’ soci- yes, we do provide some support for hope, candidly, that we don’t agree to ety, not just a ‘‘me’’ society. them because it is going to cost some either amendment at this time, al- There has been a recognition of the of these businesses a substantial though I would certainly vote for my importance of the minimum wage. amount of money. amendment and vote against the We want to provide some relief from amendment offered by the Senator I will include in the RECORD the sup- a Government mandate, mandating ad- from Massachusetts. port for the increase of the minimum ditional cost. So we want to provide But I am hopeful that we can get the wage. additional relief in doing so. requisite number of votes down the Mr. President, 552 economists agree, What I think we are trying to do is road on a welfare bill, actually pass including a number of Nobel laureates. find an acceptable compromise to be this legislation, and get it over to the This is a summation of what they say. able to pass in the Senate. House. House leadership has not ex- We believe that a modest increase in I candidly don’t believe—and I told pressed a willingness to bring this up. the minimum wage would improve the the Senator from Massachusetts when I Again, as we work on this, we have well being of low-wage workers and spoke to him last week—this is the ap- an opportunity to get it to conference would not have the adverse effect that propriate place for his amendment. I and hopefully be able to do something critics have claimed. In particular, we understand there are a lot of dynamics which provides much more targeted re- share the view of the Council of Eco- at play here. But the Senator from lief to workers who are in need, as op- nomic Advisers’ economic report, that Massachusetts feels compelled to offer posed to Senator KENNEDY’s approach the weight of evidence suggests that it on the bankruptcy bill. I don’t think which is very blunt, forceful, and de- the modest increase in the minimum there is any secret, after listening to structive, I would argue, and brings a wage has had very little or no effect on the debate over the past week, that we measure of damage to a lot of lower employment. very much would like to keep this bill skilled, lower income workers. And it That is what an outstanding group of on the Senate floor the way it came would be very damaging to business at economists have said. Let us not just out of committee and the way it has the same time in that the economy is take what they have said, let us take a been forged over a period of three Con- recovering very nicely right now. look at the facts in terms of employ- gresses. This compromise has almost This is a modest approach. It has half ment and job growth. passed this year, and time and time the increase the Senator from Massa- If you look over at this chart, you again for the last three Congresses. chusetts is suggesting. It focuses on will find the increase in the minimum Now we have an opportunity to actu- those who are most in need. At the wage in October of 1996. We had an in- ally get this thing signed—passed by same time, it doesn’t hurt the small crease in the minimum wage. In Octo- the House in the form it is right now business community. In fact, it pro- ber of 1997, it went up again. The min- on the floor of the Senate, and then to vides a much needed incentive for them imum wage increased to $4.75 in 1996, the President. to be able to continue to hire employ- and then it went up to $5.15 an hour. I was hoping the Senator from Mas- ees and grow, which is obviously the This red line is an indication of the sachusetts would not offer his amend- ticket to middle-class America. job growth during this period of time.

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00009 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.012 S07PT1 S2120 CONGRESSIONAL RECORD — SENATE March 7, 2005 I don’t accept the arguments that my simple on the issue of flextime. Our Re- One in every 10 families, up to 44 mil- good friend from New Hampshire has publican friends want flextime when lion Americans, live poverty—one out made—that this is going to mean the the employer can decide it. They have of every six children; one out of every loss of jobs. It just has not been so. flextime now under current minimum five Hispanics; one out of every four If you look at the historic lows of un- wage. They can work that out with re- Americans. The greatest impact of employment after the minimum wage, gard to flextime, up to 40 hours. Then, raising the minimum wage is going to if you look again in 1996, the minimum if it is going to be more than 40 hours, be lifting up Hispanics and African wage went to $4.75, and unemployment they have the overtime. But they nego- American workers. That is what the went up. It picked up a tenth of a tiated that out. That is permitted statistics demonstrate. point, but then it started down. today under the law. I don’t know why we have the imper- The minimum wage goes up to $5.15, But that isn’t what the Senator’s ative of constantly saying no, that we and what happened? It continues to go amendment would say. If the employer are just not going to help people who down. wants that individual to work 50 hours are working and want to work. Here is the last time that we have 1 week, and 30 hours the next week, the An interesting point—not a major the increase in the minimum wage, and employer can make up their mind. one—is that when we raise the min- we see it had absolutely no impact— Why is it always the individual em- imum wage, it not only affects the 15 none, zero—in terms of unemployment, ployer who makes it up? million lowest income people; some of It was nice to hear my friend from as we reported, for good reason, be- those people then will not be eligible Pennsylvania say they work it out over cause it is less than one-fifth of 1 per- for some of the other programs. So it in their office, and sometimes they cent of total payroll. So it has no im- saves the taxpayer some money. We pact in terms of unemployment, and it work longer hours. I would say, by and large, they work move them out and work with the has virtually no impact in terms of in- it out—the employees work it out. earned-income tax credit. We have the flation. But it does have an important I doubt very much for many of us in earned-income tax credit that works impact in terms of social justice. the Senate, if we just told our people with families who have children. If This chart is interesting. It indicates what they were going to have to do, if there is an increase in the earned-in- that the States with the higher they did not do it in the sense of expec- come tax credit, if you have two or minium wage add more jobs. These are tation and teamwork, I don’t think we three children, that is the way to go. the 39 States with the minimum wage are going to be very much value to For a single worker, if we are talking at $5.15. Their employment growth has many of our constituents. about a single mom with one or two been 4.1 percent, and some have been The fact is, under the Santorum children, an increase of the minimum somewhat higher at 6.2 percent. amendment one person makes that de- wage is the way to go. We have debated this time in and cision on flextime, and that is the em- As a society, if you are interested in time out. The most inclusive studies ployer. If the employee says, Look, I trying to do something about poverty were the Card-Krueger studies and the have a child who is in a play that I and working families, you are trying to conclusions they have made. They are would like to go to, and the employer do something about both of those. from Princeton, NJ. says, No, you can’t go—you don’t go. My friend from Iowa is here and I Contrary to the central prediction of the We tried for many years. I mentioned want to mention to him, because he textbook model of the minimum wage, but before the Senator arrived on the floor has been a leader in the Senate regard- consistent with a number of recent studies of the Senate, I think he has been ing overtime compensation, under the based on a cross-sectional time series com- against any increase in the minimum Santorum amendment, this will take parison of affected and under-affected com- wage 17 times. It is a little difficult to away the overtime rights that exist for munities of unaffected markets or employ- get much encouragement. ees, we find no evidence that the rise in New minimum wage workers because it ex- Jersey’s minimum wage reduced employ- I think the Murray amendment asked cludes 10 million workers from the Fair ment. that an employee would be able to take Labor Standards Act—6 million last 24 hours off with sufficient notice be- This is pretty well established. It has year—and it will result in millions los- cause of a child with medical appoint- a dramatic impact in other areas. ing their overtime coverage. ments, or because a child might be in a I listened with interest to the Sen- The second point I mention to my play, or a child might have some spe- ator from Pennsylvania talking about friend from Iowa, in this legislation cial event. I was here many times when the increase in the minimum wage. there is a prohibition for States to en- the Senator from the State of Wash- Better than 60 percent of the increase force their tax credit provisions. We ington offered that amendment. It was in the minimum wage goes for the low- have the tip credit for $2.12 or $2.13, and voted down every single time. The only that is the Federal credit. Under the est 40 percent on the economic ladder. way we get flextime is when the em- Let us look at what has been hap- Santorum amendment, we are taking ployer does it. That is not fair. That is away any kind of enforcement of that, pening in our country in the recent not right. He is correct. That is what not just by the Federal Government times since the last increase in the this bill does. And he will permit the but the State government. minimum wage. employer to make that judgment. I brought this up earlier because I This is in the area of hunger. We I want to make another point or two have the survey of hunger and home- about the U.S. Conference of Mayors want to remind the Senator from Iowa lessness by the Conference of Mayors. study. the amendment on the increase in the This is December 2004. This is in their Seventeen percent of the homeless minimum wage happens to be 3 pages summary: people in cities, according to the Con- long; his is 85 pages. That includes not Officials in the survey estimate that ference of Mayors, are employed. Ten only the tip credit, not only elimi- during the past year, requests for percent are veterans. nating from coverage those workers emergency food assistance increased by The demand for emergency shelter is who work even in companies that are an average of 14 percent, with 96 per- increasing. Seventy percent of the cit- capitalized at $500,000, if they are in cent of the cities registering an in- ies are reporting an increase in the last interstate commerce—That has been crease; requests for food assistance by year, and the percentage of cities re- part of the minimum wage since the families with children increased by an porting an increase with homeless fam- 1930s—but the Senator from Pennsyl- average of 13 percent; 56 percent of the ilies with children is even greater. vania wants to take out that kind of people requesting emergency food were This is what is happening. It isn’t coverage. Hundreds of thousands of members of families, children and par- just the Senator from Massachusetts. workers will lose their coverage. ents; 34 percent of adults requesting This is the Conference of Mayors tell- I don’t understand why he is tar- food assistance were employed. ing about what is happening in urban geting those individuals. Quite frankly, These are people who just can’t make and rural America. It is also about the most incredible provision in this it with the $5.15 increase in the min- growth. amendment is to eliminate any kind of imum wage. This is the general challenge. We enforcement. Then I heard about flextime. We are have too many Americans who are now The Senator might have difficulty in all for flextime. The argument is very living in poverty. following all of the points I am raising

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00010 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.015 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2121 on the amendment, but on page 14 of not increased the minimum wage now cates when the minimum wage was the Santorum amendment it sounds in 8 years. It is at the second lowest higher relative to, say, corporate sala- very appealing. Small Business Paper- purchasing level in nearly 60 years. A ries and what CEOs were making, that, work Reduction; skip over to page 16 third of all those that go into bank- in fact, our country enjoyed a higher and we find out on the bottom of that, ruptcy are those below the poverty standard of living. Is it not true that if line 22, what it is about. line. This has a direct relevancy to the people are making a more decent min- Notwithstanding any other provision, no underlying bill because we are trying imum wage, it lifts them out of pov- State may impose a civil penalty on a small to raise up people with the minimum erty; they are better able to provide business concern. wage. We are not going to get them up food and clothing and shelter for their And it applies that to every kind of to the poverty line, but we will prob- kids and their family, better able to unsafe work conditions, including air ably raise up some people as a result of pay tuition to go to college. pollution, toxic substances, unsafe the increase. It seems to this Senator, and I ask food. What in the world are we think- Therefore, it is appropriate to this my friend from Massachusetts, under ing of? Why would we include those? legislation. It is long, long overdue. It the underlying bill, the bankruptcy What is the reason we are doing that? seems to me at a time we are doing so bill, we are providing all kinds of sup- I don’t understand it. I can under- much for the credit card industries, port, immunities, coverage, for credi- stand the Senator from Pennsylvania companies that have billions of dollars tors and especially credit card compa- saying he wants a lower increase in the in profits, that we ought to be willing nies; we are providing them all protec- minimum wage, but then to have provi- to make work pay. tion, but now when it comes to pro- sions in his amendment which are so I know that bothers some Senators. viding minimum protection for the punitive to millions of workers—not It bothers the Senator from New lowest income people in this country, just on the overtime but in terms of Hampshire who criticized this and said, we cannot seem to do it. protecting those workers that get the Well, we do not want to be like the So- It seems incongruous that we would tip credit of $2.12 and then depend on viet Union and like communist coun- protect the biggest, but for the small- tips for the rest of it, and to say, no, we tries. est we cannot seem to do that. are not going to enforce the $2.12. It is interesting that Great Britain The PRESIDING OFFICER (Mr. Mr. SANTORUM. Will the Senator just went up to more than $9 for the VITTER). The Senator from Massachu- yield? minimum wage last week. They have setts. Mr. KENNEDY. Briefly. the most successful economy in Europe Mr. KENNEDY. The Senator is abso- Mr. SANTORUM. Mr. President, I at the present time. They have taken lutely right. point out to the Senator page 20 of my 1.2 million children out of poverty. I want to catch my friend from Penn- amendment discusses the tip credit. It They have the lowest home mortgages sylvania before he walks out. The Sen- specifically refers to only States that in 50 years. They brought unemploy- ator is quite correct. In a more basic are covered by this provision as States ment down. And they are trying to do way, this has been something Repub- that do not have a tip credit. I believe better for the children that are living licans and Democrats have worked on it is seven States that are the only in poverty. They have just raised their together. President Eisenhower, the States covered by this provision. minimum wage in Great Britain. first President Bush, President Ford— So I don’t know where you get ‘‘mil- I will include the other countries all supported an increase. Since the lions’’ of workers. that are not, allegedly, Communist. time I have been here we have had bi- Mr. KENNEDY. If you read from page That includes a good many of the Euro- partisan coalitions. But as the Senator 21, the top line from 2 down to line 16, pean countries: Belgium, Ireland, U.K., remembers, under the Republican lead- it effectively states: ‘‘may not estab- Portugal, France, Spain, and Greece. ership they have refused to do so. lish or enforce any laws that require I don’t think the argument was seri- I mention one thing to my friend employers to tip credit employee.’’ ous. from Pennsylvania. I have a letter, Mr. SANTORUM. I refer the Senator Mr. HARKIN. Will the Senator yield? which I will include in an appropriate to line 20 through line 25. If the Sen- Mr. KENNEDY. I am happy to yield. place, from Ohio State University, ator would read that, he will find that Mr. HARKIN. Did I hear the Senator from a professor of law who said the any State which prohibits any portion correctly that someone was suggesting proposed Santorum legislation would of employee tips from being considered the minimum wage is communistic? also reduce existing protections pro- as wages, so that is the operative lan- Mr. KENNEDY. I think the argument vided to tip employees by prohibiting guage that limits this provision—just made by my friend—and I want to be State and local governments from en- in the States that do not allow a tip careful about how I explain it. He took forcing any State or local law that credit. issue when I said in the Senate Cham- fails to grant a 100 percent tip credit. Mr. KENNEDY. The Senator under- ber what I believed, that this is a value That is, employers would be allowed stands that every State has to have the issue. We hear a great deal about the under State and local law to pay noth- tip credit at the present time. They importance of values, having work pay, ing to tip employees as long as their have to have the $2.12. respecting that work is a value issue. tips from customers add up to the min- Mr. SANTORUM. My understanding It is a family issue that affects chil- imum wage. This provision would even is that is not the case and there are dren. However, it is a value issue. It in- override the laws of States that have seven States that do not. dicates that we believe work should eliminated the tip credit entirely or Mr. KENNEDY. Under Federal law at pay. that require tip employees to be paid the present time, every State has to My good friend, and he is my friend minimum wage by their employers. have a minimum of $2.13 and then the from New Hampshire, said that sound- That is the reason I mentioned this States can add on top of that. Many of ed an awful like a government estab- earlier. If that was not the intention of the States do. The State of Pennsyl- lishing pay like Communist economies the Senator, hopefully we can correct vania has added, I believe, 60 or 70 did. I don’t want to go into it a great that. cents on top of that. deal more. The PRESIDING OFFICER. The Sen- So when you talk about not permit- Mr. HARKIN. If the Senator would ator from Pennsylvania is recognized. ting any States to enforce the tip cred- yield, it seems we have settled that Mr. SANTORUM. Mr. President, I it, you are talking all the States. That issue in this country. Going back how will be brief. I know the Senator from is the way we read it. many years now have we had a min- Iowa is here. I do not want to stop him Mr. SANTORUM. I say to the Sen- imum wage? from making his remarks. I just want ator from Massachusetts— Mr. KENNEDY. More than 60 years. to respond to several of the things the Mr. KENNEDY. If the Senator can Mr. HARKIN. More than 60 years we Senator from Massachusetts said. clarify that language, we would be glad have had a minimum wage in this First, I would be happy to look at the to work with him. country. letter from the Ohio State professor I see my friend and colleague. We I don’t have the data with me right and see how he, in my opinion, misread have pointed out the fact that we have now, but I have seen the data that indi- the provision we had. I think I am very

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00011 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.017 S07PT1 S2122 CONGRESSIONAL RECORD — SENATE March 7, 2005 clear on the intent. If there is some Also, the Senator from Massachu- ers who violate this provision and im- language clarification, I would be setts talks about how onerous this is pose this on their workers unknow- happy to sit down and work on that. I on employees. The Senator from Mas- ingly and involuntarily or as a condi- know Senator ENZI, of course, from the sachusetts voted for this with respect tion of employment. So I would just HELP Committee worked on this lan- to Federal employees. He voted for this suggest there are pretty high and guage and would be willing to do so provision, as we see here, flextime, for threatening damages to employers who also. Federal employees on more than one abuse this provision. A couple of comments. The Senator occasion. As you know, we now have One final point I want to make. The from Massachusetts talked at length this provision, this ‘‘onerous’’ provi- Senator talks about its importance, about economists and others who are sion, which, I can tell you, my employ- that this is the only way we are going suggesting that we need—I think I am ees do not see as onerous. They see it to help people out of poverty. I would using the Senator’s words—a modest as something that is of a great benefit suggest that is simply not the case. increase in the minimum wage. I did to them and their families. There are lots of ways, in fact, I would not see any of the charts that he So again, if the Senator from Massa- say very much more complicated ways brought out that supported his par- chusetts has some tougher language he that people get out of poverty than ticular minimum wage increase. And would like—but I think the language I just by the blunt instrument of the he used the term ‘‘modest’’ repeatedly. have read from my amendment—and I Government setting minimum wages. I am not sure there would be too many am not reading the summary. This is In fact, looking at this chart, the economists in the economy of today my amendment. welfare reform bill we passed in 1996 shows just how effective other ways who would say a 40-percent increase in AMENDMENT NO. 128 the minimum wage would be modest. I are. Requiring work is the best way. (Purpose: To promote job creation, family The Senator put up poverty statistics. think a 40-percent increase, by defini- time, and small business preservation in What he did not tell you is what those tion, probably is outside the bounds of the adjustment of the Federal minimum numbers looked like before 1996 and the what most people would consider mod- wage) welfare reform law, which I stood on est. In fact, Mr. President, I send the I would make the argument that a 20- amendment to the desk and ask for its the floor and argued passionately for. percent increase—this is what we are consideration. And I was called a whole number of suggesting—a 21-percent increase The PRESIDING OFFICER. The things as to what I was going to do to would probably be extending the clerk will report the amendment. all these poor children. What happened as a result of the wel- bounds of modesty, but it would cer- The legislative clerk read as follows: fare reform bill was that poverty tainly be much more within what most The Senator from Pennsylvania [Mr. among African-American children, the people consider to be the traditional SANTORUM] proposes an amendment num- bered 128. thing Senator KENNEDY referred to, definition. was at its lowest rate ever by the year I would just like to thank the Sen- Mr. SANTORUM. I ask unanimous 2000. It has crept up slightly during the ator from Massachusetts for bringing consent reading of the amendment be economic decline of the early part of up support for my amendment because dispensed with. this decade, but it is going back down. The PRESIDING OFFICER. Without I think, in comparing the two, the in- So the idea that the minimum wage crease we are putting forth of $1.10 objection, it is so ordered. solves these problems is just a fallacy. (The amendment is printed in today’s comports very well with what the There are lots of things that work. One RECORD under ‘‘Text of Amendments.’’) economists are saying would not be of them is work. Another is marriage. Mr. SANTORUM. So I am reading damaging to the economy and fit in We are going to have an opportunity on from the text of the amendment. And very well with what would not be dam- the floor of the Senate, when the wel- again, the Senator from Massachusetts aging to employees and employers. So fare bill comes up, to talk about how may quibble, and certainly has, with the $1.10, fits the modest framework. we shift Government policy away from, the voluntariness of this program. I Secondly, the issue of flextime. at best—I think it is ‘‘at best’’—neu- Again, I would just point the Senator think the language certainly expresses trality toward marriage, how we shift to the actual language in the amend- my intent and the intent of all those Government policy when it comes to ment. On page 3 of the amendment, it who are supporting this amendment, interacting with families and being says: that it is a voluntary program and an neutral with respect to marriage. See Except as provided in paragraph (2), no em- employee goes into it knowingly and what the huge impact is on the poor, ployee may be required to participate in a voluntarily with a written agreement. the huge impact on poor communities program described in this section. If there is other language that the Sen- and poor children, when moms and So it is purely voluntary. It says em- ator from Massachusetts would like, dads are helped to stay together in ployers may do this. Employees may obviously we are not going to do that marriage and, more importantly, when participate. It provides for a written today, but I would be happy to sit down they are introduced to the concept be- agreement arrived at with collective and see if there is a word that is more cause many women and, unfortunately, bargaining. Obviously, the collective voluntary than ‘‘voluntary.’’ men choose not to marry when chil- bargaining unit, the labor union, would I think usually when you use the dren are born out of wedlock. be responsible for any kind of flextime, word ‘‘voluntary’’ that sums up vol- So there will be plenty of time for de- which is the way it would be under the untary very well. But if there is a bet- bate on this issue of other things we law. ter word for voluntary than the word can do. But I can tell you, if you look Here, with respect to an employee ‘‘voluntary,’’ then I am pretty happy to at all these other things we are study- who is not represented by a labor orga- do so. If there is a better word—wheth- ing, the thing that is most powerful is, nization: No. 1, ‘‘a written agreement er it is ‘‘discretionary’’—than the word No. 1, jobs. The concern many have— arrived at between the employer and ‘‘may,’’ I am happy to look at a better and there are studies we can put into employee before the performance of the word than ‘‘may.’’ ‘‘May’’ is usually a the RECORD about what the impact of a work involved if the agreement was en- pretty good word when it describes dramatic increase—not a small in- tered into knowingly and voluntarily ‘‘you do not have to.’’ ‘‘May,’’ that is crease, as we are proposing, but a dra- by such employee and was not a condi- what we usually use. But if ‘‘vol- matic increase—in the minimum wage tion of employment.’’ untary’’ and ‘‘may’’ are not strong would have to the employment picture Now, again, I would ask the Senator enough words, I will be happy enough of these very people who came off wel- from Massachusetts, if there is strong- to sit down with the Senator from Mas- fare and their ability to find work and er language he would like us to use to sachusetts and come up with a better get out of poverty. It will have a dra- make sure this is a voluntary agree- one. matically negative impact on them, a ment and that the employee and em- I repeat, the Senator from Massachu- 40-percent increase in the minimum ployer enter into it willingly—there setts has voted for this for Federal em- wage. are quadruple damages if the employer ployees, and there are quadruple dam- But again, there are positive things violates this. ages—quadruple damages—for employ- we can do as we look to the future.

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00012 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.019 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2123 This bill, in my opinion, belongs on Americans out of poverty; its priority year-round worker, that would add welfare legislation, requiring work, is keeping labor costs low for corporate $4,370 in income. That could be a real more work, which is what is going to America. But this is not surprising. value to a family living in poverty. For be required in this bill, as well as some The President has been quite frank and a low-income family of three, let’s say things to bring fathers back into the open about taking care of what he calls one wage earner, single mother, two home with the Father Initiative that his ‘‘base.’’ children, that would be enough money Senator BAYH and Senator DOMENICI I strongly support Senator KEN- to pay for a year and a half of heat and and I have been pushing for several NEDY’s amendment to raise the min- electricity or a full tuition for a family years, as well as the marriage initia- imum wage to $7.25 in three steps. It is member pursuing a community college tive that the President has talked long overdue. It has been 5 years since degree. about. we last had a vote on the minimum The Senator from Pennsylvania said This is a complex picture and blunt wage, and it has been 8 years since we what really lifts people out of poverty instruments like minimum wages are last voted to raise the minimum wage. is more work, not raising the minimum not the answer. Yes, I am proposing an To have the same purchasing power it wage. I ask: How can a single mother of increase. I am doing one that I think had in 1968, the minimum wage would two working a minimum wage job work comports with balancing the interest have to be nearly $8.50 today, not $5.15. more? What is she supposed to do— of low-income workers having a better Since the last increase in 1997, the work 16 hours a day at the minimum wage with making sure they have a job value has eroded by more than 15 per- wage? How much more can people be in the first place because that is the cent. expected to work? most important thing. I think we have I noticed that the Senator from The amendment of the Senator from done so with this $1.10 increase and the Pennsylvania was saying that this Pennsylvania changes the 40-hour provisions I have. would increase the minimum wage by workweek to an 80-hour work period Yes, it is a long amendment. But 40 percent. Actually, it is 37 percent over 2 weeks, with the maximum that there are a lot of things in here that I that Senator KENNEDY’s amendment anyone can work in 1 week of 50 hours. think will add to the quality of life of would raise the minimum wage. In Add it up. It doesn’t take a mathemati- many workers and certainly help small three stages, it would increase it by 37 cian. Eighty hours for 2 weeks; you can businesses absorb some of the costs of percent. The Senator from Pennsyl- work up to 50 hours in 1 week. So you the increase in the minimum wage. vania said this was unprecedented. work 50 hours 1 week, 30 hours the next So with that, Mr. President, I yield Under Franklin Roosevelt, it went up week. Guess what. You just got cheat- the floor. 53 percent; under Truman, 47 percent. ed out of 10 hours of overtime. Before, The PRESIDING OFFICER. Who Under Eisenhower, it went up 33 per- you would work 40 hours. If you worked yields time? cent. Under the first President Bush, it 50, you would get 10 hours of overtime. The Senator from Iowa is recognized. went up 25 percent. The point is that Now you don’t get any overtime. That Mr. HARKIN. Parliamentary inquiry: since 1997, the last time we raised it, is what is happening to low-income Who controls the time? The PRESIDING OFFICER. The Sen- the value has eroded by 15 percent. So workers in America today. First of all, we have a bankruptcy ators from Pennsylvania and Massa- if we are going to boost it up over the bill that slaps them in the face. It chusetts control the time. next 3 years and it increases by 37 per- Mr. HARKIN. Mr. President, how cent, you are really only going up by 22 makes them pay through the nose. I much time is left on either side? percent more than what it was in 1997. don’t know if anyone read the article The PRESIDING OFFICER. The Sen- I don’t think that is an undue burden in the Washington Post yesterday. I will ask consent to print this article at ator from Massachusetts has 321⁄2 min- on business in America. utes and the Senator from Pennsyl- Since 1997, the last time we raised the conclusion of my remarks. They vania has 48 minutes 17 seconds. the minimum wage, Members of Con- mention a Ruth Owens in Cleveland Mr. HARKIN. I will take 12 minutes. gress have raised their own pay seven who tried for 6 years to pay off a $1,900 Will the Chair please remind the Sen- times in the last 8 years by $28,500. balance on her Discover card, sending ator when 10 minutes is used up? Think about that. We vote to raise our the credit company a total of $3,492 in The PRESIDING OFFICER. The pay seven times in 8 years by $28,500, monthly payments from 1997 to 2003. Chair will so notify the Senator. but for minimum wage workers earning Yet her balance grew to $5,564.28 even Mr. HARKIN. I appreciate that. $10,700 a year, we can’t vote to raise though she never used the card to buy Mr. President, with the increase in their minimum wage—shame on the anything more. So she paid $3,492 on a the unemployment rate that we Senate. $1,900 balance, and she still has yet to learned of last Friday, it is clear we are We have heard in the past that it is pay off her balance. in the midst of a two-tiered economic mostly teenagers and part-time work- They mention another person, a spe- recovery. We have one recovery for ers who are working for the minimum cial education teacher, Fatemeh high-income Americans, for people on wage. That is not the case. The facts Hosseini, who worked a second job to Wall Street, and we have a very dif- are, 35 percent of those earning the keep up with the monthly payment she ferent recovery for people working on minimum wage are the family’s sole collectively sent to five banks to try to Main Street. breadwinners, 61 percent are women, pay $25,000 in credit card debt. Even The Neiman Marcus crowd is popping and almost a third of those women are though she had not used the cards to champagne corks, but it is a very dif- raising children. buy anything more, her debt nearly ferent story for Wal-Mart and K-mart The Senate Finance Committee may doubled to $40,574 by the time she filed shoppers and for the Americans who soon be marking up a welfare reauthor- for bankruptcy last June. work at Wal-Mart and K-mart and in ization bill. As the Senate con- That is what is happening to poor other jobs paying low wages. The num- templates welfare reauthorization, as people. The credit card companies suck ber of Americans in poverty has in- we address the goal of moving people them in with a credit card, go out and creased by more than 4 million since from welfare to work, it is especially charge it up, nice and easy. They find President Bush took office. Nearly 36 important we act to raise the min- they have a $1,900 bill to pay. They million people live in poverty, 13 mil- imum wage. Since 1996, we reduced the start paying a little bit here and there. lion children. Among full-time year- number of welfare cases by half. They miss a couple of payments. All of round workers, poverty has doubled I was intrigued by the chart the Sen- a sudden they have $5,564 to pay. since the late 1970s, from about 1.3 mil- ator from Pennsylvania put up because Nearly 7.5 million workers would di- lion then to 2.6 million now. Every day many of the people who moved off of rectly benefit from the Kennedy that the minimum wage is not in- welfare did not move out of poverty. amendment. In Iowa, 87,400 workers creased, it continues to lose value and Why? Because the minimum wage is would benefit from the increase. That workers fall further and further be- not a living wage; it is a poverty wage. is over 6 percent of Iowa’s workforce. hind. But an increase to $7.25, such as Sen- The minimum wage needs to be raised Unfortunately, the Bush administra- ator KENNEDY wants to do, would make to a level that is not a subsistence tion’s priority is not lifting working a dramatic difference. For a full-time wage. The way to do that is to raise the

VerDate Aug 04 2004 00:40 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00013 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.020 S07PT1 S2124 CONGRESSIONAL RECORD — SENATE March 7, 2005 minimum wage to a level that respects entitled ‘‘Credit Card Penalties, Fees such as anti-abortion protesters from using work, honors it, and rewards work at a Bury Debtors’’ by Kathleen Day and bankruptcy as a shield against court-im- reasonable level. Caroline E. Mayer, which appeared yes- posed fines. Just last week our friends on the Credit card companies and most congres- terday, be printed at this point in the sional Republicans say current law needs to other side of the aisle were touting RECORD. be changed to prevent abuse and make more what they called their ‘‘Republican There being no objection, the mate- people repay at least part of their debt. Con- poverty alleviation agenda.’’ I say rial was ordered to be printed in the sumer-advocacy groups and many Democrats watch what they do, not what they say. RECORD, as follows: say people who seek bankruptcy protection The President sent up a budget request [From the Washington Post, Mar. 6, 2005] do so mostly because they have fallen on hard times through illness, divorce or job replete with cut after cut to anti- CREDIT CARD PENALTIES, FEES BURY DEBTORS loss. They also argue that current law has poverty programs. Now the Senator (By Kathleen Day and Caroline E. Mayer) from Pennsylvania has launched a new strong provisions that judges can use to For more than two years, special-edu- weed out those who abuse the system. attack on the minimum wage and the cation teacher Fatemeh Hosseini worked a Opponents also argue that the legislation 40-hour workweek. Now the Senator second job to keep up with the $2,000 in is unfair because it ignores loopholes that from Pennsylvania says he wants to in- monthly payments she collectively sent to would allow rich debtors to shield millions of crease the minimum wage, albeit only five banks to try to pay $25,000 in credit card dollars during bankruptcy through expensive $1.10 an hour over the next 2 years, debt. homes and complex trusts, while ignoring about half of the Kennedy amendment. Even though she had not used the cards to the need for more disclosure to cardholders buy anything more, her debt had nearly dou- But again, he guts it by ending the 40- about rates and fees and curbs on what they bled to $49,574 by the time the Sunnyvale, say is irresponsible behavior by the credit hour workweek and going to this 50- Calif., resident filed for bankruptcy last card industry. The Republican majority, hour max, 80-hour work period over 2 June. That is because Hosseini’s payments along with a few Democrats, has voted down weeks. sometimes were tardy, triggering late fees dozens of proposed amendments to the bill, The PRESIDING OFFICER. The Sen- ranging from $25 to $50 and doubling interest including one that would make it easier for ator has used 10 minutes to this point. rates to nearly 30 percent. When the addi- the elderly to protect their homes in bank- Mr. HARKIN. I thank the Chair. tional costs pushed her balance over her ruptcy and another that would require credit Last year, the Bush administration’s credit limit, the credit card companies added card companies to tell customers how much new rule effectively eliminated over- more penalties. extra interest they would pay over time by ‘‘I was really trying hard to make min- time pay protection for some 6 million making only minimum payments. imum payments,’’ said Hosseini, whose fi- No one knows how many consumers get American workers. The Senator from nancial problems began in the late 1990s caught in the spiral of ‘‘negative amortiza- Pennsylvania is opening a second front when her husband left her and their three tion,’’ which is what regulators call it when in the war on the minimum wage and children. ‘‘All of my salary was going to the a consumer makes payments but balances the 40-hour workweek. While 1.2 mil- credit card companies, but there was no continue to grow because of penalty costs. lion workers would qualify for the min- change in the balances because of that inter- The problem is widespread enough to worry imum wage increase under the est and those penalties.’’ federal bank regulators, who say nearly all Punitive charges—penalty fees and sharply Santorum amendment, another 6.8 mil- major credit card issuers engage in the prac- higher interest rates after a payment is tice. lion workers would lose their current late—compound the problems of many finan- Two years ago regulators adopted a policy minimum wage protection. cially strapped consumers, sometimes mak- that will require credit card companies to As I said, then we get the 80-hour ing it impossible for them to dig their way set monthly minimum payments high work period for a 40-hour workweek. out of debt and pushing them into bank- enough to cover penalties and interest and This has only one purpose: to allow ruptcy. lower some of the customer’s original debt, more employers to avoid paying over- The Senate is to vote as soon as this week known as principal, so that if a consumer time compensation. In my 30 years in on a bill that would make it harder for indi- makes no new charges and makes monthly viduals to wipe out debt through bank- Congress, I don’t recall such a bold, minimum payments, his or her balance will ruptcy. The Senate last week voted down begin to decline. brazen assault on the compensation of several amendments intended to curb exces- Banks agreed to the new rules after, in the American workers than what we see in sive fees and other practices that critics of words of one top federal regulator, ‘‘some the Santorum amendment. It ought to the industry say are abusive. House leaders arm-twisting.’’ But bank executives per- be called the shock-and-awe amend- say they will act soon after that, and Presi- suaded regulators to allow the higher min- ment. Workers get the shock, and cor- dent Bush has said he supports the bill. imum payments to be phased in over several porate America sits back in awe at the Bankruptcy experts say that too often, by years, through 2006, arguing that many cus- latest gift from the party it financed in the time an individual has filed for bank- tomers are so much in debt that even slight ruptcy or is hauled into court by creditors, the last election. increases too soon could push many into fi- he or she has repaid an amount equal to nancial disaster. I am proud to stand with Senator their original credit card debt plus double- Credit card companies declined to com- KENNEDY to raise the minimum wage digit interest, but still owes hundreds or ment on specific cases or customers for this to $7.25. The present one, at $5.15, is a thousands of dollars because of penalties. article, but banking industry officials, poverty wage. It doesn’t respect the ‘‘How is it that the person who wants to do speaking generally, said there is a good rea- dignity of their work, including the right ends up so worse off?’’ Cleveland Mu- son for the fees they charge. most humble. As Senator KENNEDY nicipal Judge Robert J. Triozzi said last fall ‘‘It’s to encourage people to pay their bills said, of all the issues we are debating, when he ruled against Discover in the com- the way they said they would in their con- pany’s breach-of-contract suit against an- this is a values issue. Think about this tract, to encourage good financial manage- other struggling credit cardholder, Ruth M. ment,’’ said Nessa Feddis, senior federal compared to all the things we are doing Owens. counsel for the American Bankers Associa- to help the credit card companies with Owens tried for six years to payoff a $1,900 tion. ‘‘There has to be some onus on the the bankruptcy bill. Think about that. balance on her Discover card, sending the cardholder, some responsibility to manage We are going to stick it to low-income credit company a total of $3,492 in monthly their finances. ‘‘ people, hard-working Americans like payments from 1997 to 2003. Yet her balance High fees ‘‘may be extreme cases, but they Ruth Owens and Fatemeh Hosseini, and grew to $5,564.28, even though, like Hosseini, are not the trend, not the norm,’’ Feddis then we are going to stick it to them she never used the card to buy anything said. more. Of that total, over-limit penalty fees ‘‘Banks are pretty flexible,’’ she said. ‘‘If again by not allowing them to even alone were $1,158. you are a good customer and have an occa- have an increase in the minimum wage. Triozzi denied Discover’s claim, calling its sional mishap, they’ll waive the fees, be- I would have hoped that the Presi- attempt to collect more money from Owens cause there’s so much competition and it’s dent would have come and asked for an ‘‘unconscionable.’’ too easy to go someplace else.’’ Banks are increase in the minimum wage and got The bankruptcy measure now being de- also willing to work out settlements with his party in the Congress to work with bated in Congress has been sought for nearly people in financial difficulty, she said, be- us to increase it. We have done it under eight years by the credit card industry. cause ‘‘there are still a lot of options even Twice in that time, versions of it have for people who’ve been in trouble.’’ Republican Presidents in the past and passed both the House and Senate. Once, Many bankruptcy lawyers disagree. James Democratic Presidents. I don’t know President Bill Clinton refused to sign it, say- S.K. ‘‘Ike’’ Shulman, Hosseini’s lawyer, said why we cannot do it again. ing it was unfair, and once the House re- credit card companies hounded her and did Mr. President, I ask unanimous con- versed its vote after Democrats attached an not live up to several promises to work with sent that the Washington Post article amendment that would prevent individuals her to cut mounting fees.

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00014 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.022 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2125

Regulators say it is appropriate for lenders frenzy,’’ among credit card issuers, said Rob- DAYTON, and Mr. KENNEDY, proposes an to charge higher-risk debtors a higher inter- ert McKinley, Cardweb’s president and chief amendment numbered 66. est rate, but that negative amortization and executive. ‘‘The whole mentality has really Mr. HARKIN. Mr. President, I ask other practices go too far, posing risks to the changed over the last several years,’’ with unanimous consent that the reading of banking system by threatening borrowers’ the industry imposing fees and increasing in- the amendment be dispensed with. ability to repay their debts and by being un- terest rates if a single payment is late. fair to individuals. Penalty interest rates usually are about 30 The PRESIDING OFFICER. Without U.S. Bankruptcy Judge David H. Adams of percent, with some as high as 40 percent, objection, it is so ordered. Norfolk, who is also the president of the Na- while late fees now often are $39 a month, The amendment is as follows: tional Conference of Bankruptcy Judges, and over-limit fees, about $35, McKinley said. (Purpose: To increase the accrual period for said many debtors who get in over their ‘‘If you drag that out for a year, it could be the employee wage priority in bankruptcy) heads ‘‘are spending money, buying things very damaging,’’ he said. ‘‘Late and over- On page 498, strike lines 23 and 24, and in- they shouldn’t be buying.’’ Even so, he said, limit fees alone can easily rack up $900 in sert the following: ‘‘once you add all these fees on, the amount fees, and a 30 percent interest rate on a (1) in paragraph (4), by striking ‘‘within 90 of principal being paid is negligible. The fees $13,000 balance can add another $1,000, so you days’’; and interest and other charges are so high, could go from $2,000 to $5,000 in just one year Mr. HARKIN. I offer this amendment they may never be able to pay it off.’’ if you fail to make payments.’’ Judges say there is little they can do by on behalf of myself, Senators ROCKE- According to R.K. Hammer Investment FELLER, LEAHY, and DAYTON, and I ask the time cases get to bankruptcy court. Bankers, a California credit card consulting unanimous consent that Senator KEN- Under the law, ‘‘the credit card company is firm, banks collected $14.8 billion in penalty legally entitled to collect every dollar with- fees last year, or 10.9 percent of revenue, up NEDY be added as a cosponsor. out a distinction’’ whether the balance is from $10.7 billion, or 9 percent of revenue, in The PRESIDING OFFICER. Without from fees, interest or principal, said retired 2002, the first year the firm began to track objection, it is so ordered. U.S. Bankruptcy Judge Ronald Barliant, who penalty fees. Mr. HARKIN. I ask that the amend- presided in Chicago. The only question for The way the fees are now imposed, ‘‘people ment be set aside. the courts is whether the debt is accurate, would be better off if they stopped paying’’ The PRESIDING OFFICER. Is there judges and lawyers say. John Rao, staff attorney of the National once they get in over their heads, said T. objection? Consumer Law Center, one of many con- Bentley Leonard, a North Carolina bank- Without objection, it is so ordered. sumer groups fighting the bankruptcy bill, ruptcy attorney. Once you stop paying, The Senator from Massachusetts is says the plight consumers face was illus- creditors write off the debt and sell it to a recognized. debt collector. ‘‘They may harass you, but trated last year in a bankruptcy case filed in AMENDMENT NO. 44 Northern Virginia. your balance doesn’t keep rising. That’s the irony.’’ Mr. KENNEDY. Mr. President, there Manassas resident Josephine McCarthy’s is a point that I would hope our col- Providian Visa bill increased to $5,357 from Mr. HARKIN. Again, I urge my col- leagues would pay close attention to, $4,888 in two years, even though McCarthy leagues to disavow the Santorum has used the card for only $218.16 in pur- and that is that the Santorum amend- amendment and support the Kennedy ment will eliminate the equal pay pro- chases and has made monthly payments to- amendment. It is the least we can do taling $3,058. Those payments, noted U.S. vision for women working for compa- Bankruptcy Judge Stephen S. Mitchell in Al- for the least among us—to raise their nies with sales of less than $1 million. exandria, all went to ‘‘pay finance charges minimum wage, give value to their This is enormously important. (at a whopping 29.99%), late charges, over- work. This is a values issue. This is at The Republican amendment gives limit fees, bad check fees and phone payment the heart of it. It is an issue of what pennies to minimum wage workers fees.’’ Mitchell allowed the claim ‘‘because kind of country we want, what kind of the debtor admitted owing it.’’ McCarthy, with one hand. With the other, it takes Congress we are, and what kind of Sen- thousands of dollars away from min- through her lawyer, declined to be inter- ators we are. viewed. imum wage, middle-class, and women Alan Elias, a Providian Financial Corp. With that, I yield the floor. workers. As I mentioned earlier, it spokesman, said: ‘‘When consumers sign up The PRESIDING OFFICER. The Sen- slowed it up with antiworker poison for a credit card, they should understand ator from Nebraska is recognized. pills, and the pill that is the hardest to that it’s a loan, no different than their mort- Mr. HAGEL. Mr. President, I ask swallow of the Republican amendments gage payment or their car payment, and it unanimous consent that I be allowed to needs to be repaid. And just like a mortgage effectively denies over 10 million more speak as in morning business for the workers minimum wage, overtime pay, payment and a car payment, if you are late purpose of introducing legislation. My you are assessed a fee.’’ The 29.99 percent in- and equal pay protections by elimi- terest rate, he said, is the default rate time would be charged against Senator nating the Fair Labor Standards Act charged to consumers ‘‘who don’t met their SANTORUM’s time. coverage completely. obligation to pay their bills on time’’ and is The PRESIDING OFFICER. Without Currently, all employees who work clearly disclosed on account applications. objection, it is so ordered. for employers that are engaged in Feddis, of the banker’s association, said (The remarks of Mr. HAGEL per- interstate commerce and have gross the nature of debt means that interest will taining to the introduction of S. 540 are often end up being more than the original annual sales of at least $500,000 are principal. ‘‘Anytime you have a loan that’s located in today’s RECORD under guaranteed Fair Labor Standard pro- going to extend for any period of time, the ‘‘Statements on Introduced Bills and tections. But even in businesses that interest is going to accumulate. Look at a Joint Resolutions.’’) have less than $500,000 in annual sales, 30–year-mortgage. The interest is much, The PRESIDING OFFICER. Who the employees still have individual much more than the principal.’’ yields time? Samuel J. Gerdano, executive director of Fair Labor Standard coverage if they The Senator from Massachusetts. are engaged in interstate commerce. the American Bankruptcy Institute, a non- Mr. HARKIN. Will the Senator yield partisan research group, said that focusing The Santorum amendment raises the on late fees is ‘‘refusing to look at the ele- for a unanimous consent request? $500,000 annual sales threshold to $1 phant in the room, and that’s the massive Mr. KENNEDY. Yes. million, as he mentioned, and virtually levels of consumer debt which is not being Mr. HARKIN. I ask that the pending eliminates this individual Fair Labor paid. People are living right up to the edge,’’ amendments be set aside so I can offer Standard coverage, even for workers failing to save so when they lose a second job a germane filed amendment. who are engaged in interstate com- or overtime, face medical expense or their The PRESIDING OFFICER. Is there merce. It makes one exception for family breaks up, they have no money to objection? workers engaged in industrial house- cope. Without objection, it is so ordered. ‘‘Late fees aren’t the cause of debt,’’ he work. said. AMENDMENT NO. 66 It allows businesses to pay their Credit card use continues to grow, with an Mr. HARKIN. Mr. President, I call up workers less than the Federal min- average of 6.3 bank credit cards and 6.3 store amendment No. 66. imum wage, requires them to work credit cards for every household, according The PRESIDING OFFICER. The longer hours without overtime pay, to Cardweb.com Inc., which monitors the in- clerk will report. and to be able to pay men and women dustry. Fifteen years ago, the averages were The assistant legislative clerk read 3.4 bank credit cards and 4.1 retail credit differently. cards per household. as follows: The gross annual sales threshold was Despite, or perhaps because or, the large The Senator from Iowa [Mr. HARKIN], for created as a way to determine the em- increase in cards, there is a ‘‘fee feeding himself, Mr. ROCKEFELLER, Mr. LEAHY, Mr. ployers that are engaged in interstate

VerDate Aug 04 2004 04:56 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00015 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.003 S07PT1 S2126 CONGRESSIONAL RECORD — SENATE March 7, 2005 commerce, not as a way to exempt the to businesses and can involve them in a eligible for overtime pay and reduce workers from the Fair Labor Standards cost which they may not be willing to the number of businesses in America Act. assume. required to pay the minimum wage? For over 60 years, Congress has So there has always been, to my Mr. SANTORUM. I think I was pretty amended the Fair Labor Standards Act knowledge, in almost every, if not clear about that. The answer is yes. Be- to provide even more workers with the every, Federal labor law a small busi- cause we raise the threshold from a minimum wage. Instead of trying to ness exemption, what the Senator from half million, small business, to a mil- exclude over 10 million workers from Massachusetts has said there should lion. As I said before, the half million the guaranteed minimum wage, we not be in this case. That is a very le- threshold was set in 1990. It has not should raise it. gitimate position. I do not think the been indexed. I hear a lot of comments I refer to the paragraph of the Fair Members of this body would agree—on about why we should index things here. Labor Standards Act, paragraph 206, either side of the aisle, I might add— We should index the minimum wage, that says each employer shall pay to that there should be no exemption for we should index a whole host of other each of his employees whose work is any business from this provision of the things that have the benefit of, in this engaged in commerce, in the produc- Fair Labor Standards Act. That is case, increasing workers’ pay. If that is tion of goods for commerce—that is what we attempt to correct, to make the case, if we thought $500,000 was a those who are being paid who are work- that comport with what was broadly legitimate threshold in 1990, I don’t ing for companies earning less than agreed was the intent. Unfortunately, know why it should not be indexed to $500,000. In the same paragraph it says: it has never been remedied. include in real terms that same class of No employer having employees subject to If the Senator from Massachusetts small businesses at this time. any provisions of this section shall discrimi- wants to make the argument that Mr. DURBIN. Will the Senator yield nate. there should be no businesses exempt for a further question? Those are eliminated. So we don’t from the Federal Fair Labor Standards Mr. SANTORUM. I am happy to. have equal pay for equal work in the Act, fine. Make that argument and we Mr. DURBIN. If the Senator is pre- United States. There are only a few will have that debate and we will find pared to double the size of the business areas where we do. It is in this par- out how many votes we have, whether from $500,000 to $1 million because it ticular area that we do and the there should be a small business ex- should keep up with inflation, would Santorum amendment eliminates it for emption or not. But don’t suggest what the Senator be prepared to double the those individuals. I say to our col- I am doing here is some sort of subter- minimum wage of 1990 to what it leagues here in the Senate who care fuge other than to clarify that there should be today? about equal pay for equal work for are exemptions for legitimate reasons Mr. SANTORUM. I say to the Sen- women, this is a bad deal. for very small businesses. The thresh- ator from Illinois, we are increasing— The PRESIDING OFFICER. Who old was set at half a million dollars in fact, my amendment does increase yields time? The Senator from Penn- back in 1990. If you index that to infla- the minimum wage by 20 percent. sylvania. tion, it would be $1.5 million today. We Mr. DURBIN. By 100 percent? Mr. SANTORUM. I would say in re- set it at a million, which is lower than Mr. SANTORUM. I don’t recall ex- sponse to the Senator from Massachu- the rate of inflation. That is hardly actly what the increase was. I will setts, my understanding of this legisla- overreaching on the part of this check and see what the wage was in tion, the way it is written, there was amendment. 1990 as compared to what it is today. an error made in the drafting of the If the Senator wants to say there We are proposing a modest increase. If statute such that the threshold had should be no exemption, that all busi- the Senator is suggesting it should be a been basically ignored because of the nesses should be covered and there smaller increase, I will be happy to ne- provision to which the Senator from should be no small business exemption gotiate a smaller increase if it makes Massachusetts refers. It was a dif- to any labor law, fine, if that is what the Senator comfortable. ference between an ‘‘and’’ and an ‘‘or’’ the Senator from Massachusetts wants. The Senator from Massachusetts is as to how it was written. My under- Understand the consequences, that not suggesting it should be a smaller standing is that the intent of the Con- Democrats and Republicans for years increase. He is suggesting there should gress was to exempt small businesses have understood here, which is these be no exemption at all and that there as we do from a variety of different mandates on very small startup busi- was a provision—and that is what the labor laws. I mentioned before the one nesses in particular, but any small debate is about—that if they included I am most familiar with, the Family business, can be damaging to the econ- anyone in interstate commerce, even and Medical Leave Act, which has an omy in our poorest neighborhoods, in one employee, that they should be cov- employee threshold. There are others the cleaning services, in the landscape ered. In fact, that is my understanding that have thresholds in the Federal businesses, and a whole host of other of how the Labor Department has in- law, where we chose not to include small businesses where people are try- terpreted this provision. In a sense, very small businesses in some of the ing to make ends meet by pursuing there has not been any threshold. mandates the Federal Government im- their entrepreneurial spirit. By putting Again, if the Senator from Illinois poses, a variety of different labor man- these kinds of requirements and labor would like to have a threshold that in- dates. We do so because of the nature laws and regulations on these small dexes with the minimum wage, I would of the small business. A lot of these are businesses, we damage and destroy the be happy to accept that as a reasonable mom-and-pop businesses, a garage, very small businesses in this country. index. But I think to suggest it should very small employers, where the bur- I do not think that is where most on not change at all over a period of time den of complying with a variety of Fed- his side of the aisle are. That may be does, of course, begin to gather and eral statutes having to do with labor where the Senator from Massachusetts cover more and more businesses that laws when it comes to a small oper- is. If that is where he is, fine, but I are small by nature and then again it ation can be an onerous one and costly would be very proud to defend that pro- would be a barrier to entry and a dif- one. It can be a barrier to starting a vision that says the smallest busi- ficulty in sustaining those businesses business. nesses in America should not have over time. So many, including Senator HARKIN these kinds of mandates imposed on I am willing, if there is a legitimate and Senator REID, your leader, have them by Federal law. concern about this as to how much we supported this small business exemp- Mr. DURBIN. Will the Senator yield are raising the cap, again, we are will- tion as a clean exemption with no ‘‘or’’ for a question? ing to negotiate that. That is not what provision, ‘‘as engaged in interstate Mr. SANTORUM. I am happy to yield the Senator from Massachusetts is say- commerce.’’ for a question. ing. What the Senator from Massachu- Why? Because we understand that Mr. DURBIN. I am sorry that I just setts is saying is there should not be Federal law and these kinds of provi- arrived. I am trying to catch up with any threshold at all; we should keep sions can be very costly to very small this debate. Would the amendment re- the zero threshold which exists today businesses and can be a barrier of entry duce the number of workers in America in law.

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00016 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.033 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2127 I yield the floor. The States that only have Federal law It is really appropriate that we have The PRESIDING OFFICER. The Sen- covering this area do not change. The this debate on the bankruptcy bill, ator from Massachusetts. ones that do have State laws change isn’t it, when you think about it? We Mr. KENNEDY. The history for inter- accordingly. Again, many of those are going to force some of the most state workers is that from 1938, when State laws will remain in place and marginal workers, so many of the hard- the minimum wage was first passed, cover workers who are not covered est working people in America, into a the minimum wage has applied to under the Fair Labor Standards Act position where they can’t pay their them. That is being changed by the under their own State labor protection bills; then our beautiful Bankruptcy Senator from Pennsylvania. We under- laws. Code reform pushed by the credit card stand that. That is being changed. It is I yield the floor. industry will make sure they are sad- going to have a profound effect on mil- The PRESIDING OFFICER. The Sen- dled with debt for a lifetime. That is lions of workers. ator from Illinois. what this debate comes down to. It is not only by the provisions, the Mr. DURBIN. Mr. President, I ask In order to bring up the courage on coverage of the Fair Labor Standards unanimous consent to speak for 5 min- the Republican side to offer any min- Act, it is not only the payment, but it utes, and I ask the Chair to notify me imum wage increase, they had to offer is also the equal payment. when I have used 4 minutes. to the business community this dis- Second, there have been different The PRESIDING OFFICER. Does this qualification for overtime pay the in- rules with regard to retail workers. time come out of the time of the Sen- centive that many businesses would There was the overall figure of $1 mil- ator from Massachusetts? not pay a minimum wage, not to men- lion that was used on retail workers. Mr. KENNEDY. I yield 5 minutes. tion adhere to the equal pay provi- That was reduced to $500,000 and even Mr. DURBIN. Mr. President, Mem- sions. Some of these minimum wage down to $250,000. So we have been deal- bers of the Senate will have a choice in workers across America are young, sin- ing with this for many times. just a few minutes about the future of gle mothers struggling to raise kids. The point of the matter is, under the the minimum wage. Sometimes they are working one or Santorum amendment, the way it is There was a time when we didn’t two minimum wage jobs. They would constructed, there will be millions and even debate this. There was a time like to be paid equal pay in their work- millions and millions who will be out- when Democrats and Republicans place. Senator SANTORUM thinks that side the coverage of the Fair Labor agreed that every once in a while you goes too far when it comes to small Standards Act. That is plain and sim- have to raise the minimum wage. The businesses. I think this is wrong. ple. cost of living goes up in America. Re- We need to get back to the bipartisan Mr. SANTORUM. Will the Senator publican and Democratic Presidents consensus we had on minimum wage. If yield? alike said: Can’t we come together and you stand for moral values—wasn’t Mr. KENNEDY. I only have a few reasonably increase the minimum wage that the big issue in the last cam- minutes left now. The point I was mak- so that the poorest among us have a paign?—wouldn’t one moral value be as ing earlier, when I offered our amend- fighting chance for a decent life? follows: If you get up and go to work ment, it is 3 pages long, to deal with We used to do it that way. When we every day in America, if you follow the the increases in the minimum wage for stopped doing it 8 years ago when Re- rules and show up for work, you workers. The Senator from Pennsyl- publicans took control of Congress, shouldn’t live in poverty in America. vania has an 85-page law. He has op- they decided this was a partisan issue, That is a fact. Some people working posed the minimum wage 17 times in 10 that good Republicans didn’t support every single day at a minimum wage years. Minimum wagers, beware. an increase in the minimum wage; only job are living below the poverty line. Mr. SANTORUM. Mr. President, does Democrats supported it. Today, we Poverty has doubled since the late the Senator from Massachusetts yield? have a choice. The choice is very stark. 1970s. The poverty rolls have increased Mr. KENNEDY. I have to withhold Senator SANTORUM comes to the Sen- by 4 million people since President my remaining time. ate floor and says let us raise the min- Bush has taken office. The low min- Mr. SANTORUM. Mr. President, I imum wage for 1.8 million Americans. imum wage is a big part of that. Min- would like to correct the record. I have That is a pretty good thing. At least imum wage employees who work 40 supported the minimum wage on more they are going to get some help. But hours a week earn $10,750 a year. Think than one occasion during my time in look at Senator KENNEDY’s alternative. about how you would get by on $10,700 Congress. When I started in the House, In his alternative, 7.3 million Ameri- a year. In fact, we say officially that the last minimum wage that passed I cans would have an increase in the this is $5,000 less than you need to raise supported. Under the Clinton adminis- minimum wage. a family of three. We acknowledge tration, I voted for an increase. I have The Santorum Republican approach that. If you go to work, work hard, and voted for an increase in the minimum helps 1 out of 4 of the workers who Sen- are paid the minimum wage, you are wage in the past. I voted for a similar ator KENNEDY’s approach helps. But it going to live in poverty. minimum wage increase in the last ses- gets worse. In order for Senator We believe on the Democratic side of sion of Congress, or the time before. I SANTORUM to work up the political the aisle that America, if it is a just have not had any ideological problems courage to bring this to the floor, he nation, should move to the point where supporting minimum wage. I want to said: I have to turn around and do hard-working Americans get a decent correct the record about what the Sen- something on the business side. So paycheck. ator from Massachusetts said. what I will do is to exempt 10 million That is what Senator KENNEDY has I would also say with respect to workers in America from coverage for been fighting for for 8 years. I would be workers not being covered as a result overtime pay. happy to be part of that fight. of this provision of raising the thresh- Think about that. You can work 50 I say in conclusion that we talk a lot old, as you know and as the Senator hours a week at straight time. That is in the Senate about what our priorities from Massachusetts knows, there are the deal we are going to offer you for a should be. The top priority of this Sen- operative State laws which provide slight increase in the minimum wage. ate now is to make the bankruptcy worker protections in addition to Fed- Does that make sense? laws more difficult for those swamped eral law. In fact, for the States that do He goes further and says we are going by medical bills. We have tried to offer not have operative State laws which to say that fewer businesses in Amer- amendments to stand up for the acti- provide these worker protections, we ica are required to pay the minimum vated Guard and Reserve people who leave the threshold at 500-fold. We wage. What a deal. After waiting 8 are forced into bankruptcy. The Repub- don’t change the threshold for the years, he helps 1 out of 4 of the workers lican side rejected every single amend- States that do not have operative who Senator KENNEDY helps, and for ment we offered. Now we come with a worker protections for the things that the 1.8 million he helps, he pushes 5 sensible, just amendment to, frankly, the Fair Labor Standards Act applies times as many overboard. He says: You raise the minimum wage up to a decent to. are not going to get overtime. I will level in America, and what we are of- I want to make the record clear. No vote for an increase in minimum wage, fered on the other side of the aisle is an one is falling through the cracks here. but that is just part of the deal. unacceptable alternative.

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00017 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.034 S07PT1 S2128 CONGRESSIONAL RECORD — SENATE March 7, 2005 I yield the floor. An increase in the Federal minimum Jersey family of four needs a yearly Mr. HATCH. Mr. President, today the wage is long overdue. salary of anywhere from $37,516 to Senate will consider two minimum It has now been over 7 years since $56,670 to make ends meet. Now remem- wage amendments to the bankruptcy Congress last raised the minimum ber, as I mentioned earlier, an indi- reform bill, S. 256. Senator TED KEN- wage to its current level of $5.15 per vidual earning the current minimum NEDY’s minimum wage amendment pro- hour. Since that last increase, wage, working 40 hours a week, 52 poses to increase the minimum wage Congress’s failure to adjust the wage weeks a year, earns only $10,700. What by $2.10 per hour in three steps over 26 for inflation has reduced the pur- that then means is that in New Jersey, months, and Senator RICK SANTORUM’s chasing power of the minimum wage to a family of four that has both parents amendment would raise the minimum record low levels. In fact, after ac- working full-time for the minimum wage by $1.10 an hour over 18 months. counting for the loss of real value due wage would still face an annual short- I have always believed that increas- to inflation, the purchasing power of fall likely in excess of $20,000 in order ing the minimum wage is not an effec- the minimum wage has not been this to cover basic living needs. tive way to improve living standards low since the wage increase of 1945. While the Kennedy amendment seeks for the Nation’s working poor. Simply When Congress last raised the min- to provide a real wage increase to put, raising the minimum wage is a imum wage in 1996, the wage was raised workers that will help them keep up Federal government mandate which from $4.75 to its current $5.15. At the with the rising cost of living in our Na- creates negative ripples throughout the time, this modest increase had real re- tion, the Santorum amendment offered national economy by making goods and sults. The adjustment increased the by my Republican colleagues is a cruel services more expensive for families. take home pay of nearly 10 million hoax on hard-working Americans. Raising the minimum wage closes the hard working Americans. But with in- It is politics over policy, and it is doors of many small businesses, and flation, the real dollar value of that in- just plain wrong. forces companies to move jobs offshore crease is long gone. The Santorum amendment only pro- to less costly countries. Such an in- So that we are clear, raising the min- vides about half of the minimum wage crease makes it more difficult for imum wage is a family issue. So often increase of the Kennedy amendment. It many lower skilled U.S. workers to get in this body we talk about family also denies minimum wage, overtime started in the job market. issues. This is our chance to act. and equal pay rights from over 10 mil- Small businesses are the engine for No family gets rich from earning the lion workers. economic growth in America and rep- minimum wage. In fact, the current The Santorum amendment will in- resent a powerful vehicle for oppor- minimum wage does not even lift a crease the minimum wage by a mere $1.10 per hour. This amendment will tunity. A minimum wage increase family out of poverty. A person earning benefit only 1.8 million workers—5.5 would negatively affect small busi- the current minimum wage, working 40 million fewer than the Kennedy amend- nesses across the nation and in my hours a week, 52 weeks a year, earns ment. only $10,700—nearly $4,000 below the home State of Utah. The difference between an increase to For example, Wangsgard’s grocery poverty line for a family of three. $7.25 and an increase to $6.25 for a min- store of Ogden, UT, offers a full line of Seven out of every 10 minimum wage imum wage worker has a real impact groceries, along with a meat shop, workers are adults, and 40 percent of on people’s lives, particularly in a oven-fresh bakery, fresh produce, a deli minimum wage workers are the sole State such as New Jersey. It means on breadwinners of their families. More- and snack bar, coffee counter, garden average 15 fewer months of child care; center and Ace Hardware. Without a over, a disproportionate number of over a year less of tuition at a commu- doubt, this store really is a one-stop minimum wage workers are women. nity college; 10 fewer months of heat solution. Sixty percent of the 11 million min- and electricity; 6 fewer months of gro- Phillip Child, president and owner of imum wage workers are women, and ceries; and 5 fewer months of rent. Wangsgard’s grocery store, informs me many are single mothers who must put The Santorum amendment denies that a minimum wage increase would food on the table, make rent payments, more than 10 million workers min- force him to reduce jobs. In fact, Mr. and provide childcare. Increasing the imum wage, overtime pay and equal Child confirms that of his 93 employ- minimum wage by a mere $1.50 per pay rights by ending individual Fair ees, those who are earning minimum hour would mean an extra $3,000 a year Labor Standards coverage and raising wage are either in high school or living for working families. These additional the enterprise coverage threshold to $1 at home with their parents. These em- dollars can provide tangible help to million from $500,000. ployees are not supporting families. these families in the form of groceries, The Santorum amendment would be With the goal to open a second rent, and the ability to pay one’s util- the death of the 40-hour workweek and Wangsgard’s grocery store in the near ity bills. the American weekend. After the Ad- future, Mr. Child is concerned that an The problems posed by our insuffi- ministration’s denial last year of over- increase in minimum wage would cer- cient minimum wage are stark in my time protections for 6 million workers, tainly cut the number of new jobs home State of New Jersey. this proposal would further undermine available to the community. According to New Jersey Department overtime protections by allowing em- I believe education and job-training of Labor statistics, there are just over ployers to refuse to pay workers up to programs are the key to raising take- 181,000 people making minimum wage 10 hours of earned overtime pay every home pay. Of course, it’s much easier in the State. While some States have 2 weeks. to pose as the champion of the poor set higher minimum wage levels, New That means a pay cut of $3,000 a year and worry about the consequences Jersey is like most States—its min- for a median income earner—$43,000 per later. Yet if Congress does move to in- imum wage mirrors the Federal min- year—and an $800 pay cut for minimum crease the minimum wage, it should imum wage. But New Jersey is also dif- wage workers. Employers are already adopt a small, more gradual increase, ferent because the cost of living in New free to offer more flexible schedules and offset the negative consequences of Jersey far exceeds the national average under current law—the only difference a wage hike with measures to protect and working families in the State are is that now they have to pay workers the small businesses that generate a unable to make ends meet at the cur- overtime when they work more than 40 majority of all new jobs and employ rent minimum wage. As a result, min- hours in a week. most Americans. That is why I support imum wage workers in New Jersey are Finally, the Santorum amendment the Santorum amendment and oppose worse off than minimum wage workers prohibits states from providing strong- the Kennedy amendment. living in other parts of the country. er wage protections than the Federal Mr. CORZINE. Mr. President, I rise Let me quantify the severity of this standard for tipped employees like today to speak in support of Senator problem in a high-cost State such as waiters and waitresses. KENNEDY’s amendment that would New Jersey. Last year, Legal Services There are some items in the amend the Fair Labor Standards Act of of New Jersey released a self-suffi- Santorum amendment that can help 1938 to provide for gradual increases in ciency study that found that—without our small businesses. But this amend- the Federal minimum wage. private or public assistance—a New ment has been so bloated down with

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00018 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.035 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2129 provisions that are harmful to Amer- of economics. Wages do not cause sales. some 14 times in their life, and 10 of ican workers that as a whole it is not Sales are needed to provide wages. those jobs have not even been invented just bad for workers, it is ultimately Wages do not cause revenue. Revenue yet. bad for business. drives wages. Wages can cause produc- To support these needs, we need a All of our hard working families na- tivity, but the productivity has to system in place that can support a life- tionwide need and deserve a minimum come first to be able to afford the time of education, training, and re- wage that reflects the increased cost of wages. training for workers. The end result living in America. It is the least we can Skills, however, operate differently would be the attainment of goals that do for people who work hard and make than wages. Skills do create sales. provide meaningful wage growth. As a positive contribution to our great Sales produce revenue. Skills do create legislators, our efforts should better Nation. productivity. Skills get compensated focus on ensuring that the tools and Let’s not dishonor them or their ef- with higher wages or else the employee the opportunities for training and en- forts. I urge my colleagues to support simply goes elsewhere for true higher hancing skills over a Worker’s lifetime the Kennedy amendment. wages. Wage increases without in- are available and are utilized. The PRESIDING OFFICER. The Sen- creased sales or higher productivity We tried to do that through the Work ator from Wyoming. have to be paid for by higher prices. First Investment Act that got blocked Mr. ENZI. Mr. President, I rise today Higher prices wipe out wage increases. in the last Congress; 900,000 people in opposition to the amendment offered Skills, not artificial wage increases, trained to higher skilled jobs each by Senator KENNEDY which would in- produce the true net gains in income. year. That would have been a lot of crease the minimum wage by an un- The minimum wage should be for all people getting higher wages each and precedented 41 percent. Apart from its workers what it is for most: A starting every year. numerous other problems, this pro- point; a starting point in an individ- Since 1998, the Democrats have been posal is fundamentally flawed because ual’s lifelong working career. Viewed pushing a drastic increase in the Fed- it presumes that Congress, by simply as a starting point, it becomes clear eral minimum wage except—listen to imposing an artificial wage increase, that the focus needs to be less on where this—except when they were in the ma- will meaningfully address the real an individual begins his or her working jority, when they controlled this body. issues of the lowest paid workers. That career. Instead, more emphasis should In the 18 months from mid-2001 through is simply not the case. be placed on how an individual can best all of 2002, while the Democrats held Regardless of the size of a wage in- progress. the majority they did not bring the crease Congress might impose, the re- Real wage growth happens every day minimum wage vote to the floor. The ality is that yesterday’s lowest paid and it is not the function of a Govern- question must be asked, who would worker, assuming he still has a job, ment mandate. It is the direct result of really be helped? Who would be hurt by will continue to be America’s lowest an individual becoming more skilled this amendment we have today to raise paid worker tomorrow. Advancement and therefore more valuable to his or the minimum wage by an unprece- on the job and earned wage growth can her employer. dented 41 percent, to $7.25 an hour. simply not be legislated. We do a dis- As a former small business owner, I First, we must realize that the large service to all concerned—most espe- know that these entry level jobs are a increase in minimum wage will hurt cially the chronic low-wage worker—to gateway into the workforce for people low-income, low-skilled individuals, suggest that a Federal wage mandate is without skills or experience. These the very workers proponents claim the answer. What we need to focus on minimum skills jobs can open the door they want to help. Let us be clear: is not an artificially imposed number to better jobs and better lives for low- Mandated hikes in the minimum wage but on the acquisition and improve- skilled workers if we give them the do not cure poverty. They clearly do ment of jobs and job-related skills. In tools they need to succeed. not create jobs. this context, we should recognize that We have a great example in Chey- The Congressional Budget Office has only 68 percent of the students enter- enne, WY, of minimum skilled workers said most economists would agree that ing the ninth grade 4 years ago are ex- who were given the tools and the op- an increase in the minimum wage rate pected to graduate this year. For mi- portunity to reach the American would cause firms to employ fewer low- nority students, this number hovers dream. Mr. Jack Price, the owner of wage workers or employ them for fewer around 50 percent. In addition, we con- eight McDonald’s restaurants in Wyo- hours. That is the CBO estimate of Oc- tinue to experience a dropout rate of 11 ming—everyone likes to use McDon- tober 18, 1999. In 1999, based on a dollar percent per year. ald’s for the example—had three em- increase, CBO found that a plausible These noncompletions and dropout ployees who started working for range of estimates for the potential job rates and the poor earnings capacity McDonald’s at minimum wage. Now losses holds that a 10-percent in- that comes with them cannot be fixed those three employees, those minimum crease—not a 41-percent increase, a 10- by a Federal wage policy. We always wage employees, own a total of 20 res- percent increase—in the minimum have to keep this in mind. The phrase taurants. They got the skills. wage would result in a half to 2 percent ‘‘minimum wage worker’’ is an arbi- This type of wage progression and reduction in the employment level of trary designation. A more accurate de- success should be the norm for workers teenagers and a smaller percentage re- scription and one that should always across our country. However, there are duction for young adults ages 20 to 24. be at the center of this debate is that some minimum skilled workers for These estimates imply employment we are seeking to address those work- whom stagnation at the lower tier losses for an increase in the minimum ers who have few if any skills that they wage is a longer term proposition. The wage of the amount provided in the can use to compete for better jobs and answer for these workers, however, is 1999 proposal of roughly 100,000 to half command higher wages. The effect may not simply to raise the lowest wage a million jobs. Applying that same be low wages, but the cause is low rung, which raises all the other rungs, analysis today could actually double skills. In short, the problem is not a which drives up the price and takes this prediction. Upwards of one million minimum wage. The problem is min- away their advantage; rather, these in- low-wage workers, mostly teenagers imum skills. dividuals must acquire the training and young adults, can expect to lose I had a Workforce Investment Act and skills that result in meaningful their jobs or lose opportunities due to bill that the Senate 2 years ago passed and lasting wage growth. the proposal before the Senate for the unanimously. We cannot get a con- We must equip our workers with $2.10 an hour increase. ference committee to do upgrades in skills they need to compete in this What every student who has ever skills for 900,000 people a year. That technology-driven global economy. It taken an economics course knows, if would have upped the minimum wage, is estimated that 60 percent of tomor- you increase the cost of something—in and it would have upped it in a true row’s jobs will require skills that only this case, the minimum wage—you de- way. If we are to approach this debate 20 percent of today’s workers possess. crease the demand for those jobs. Mis- in a constructive and candid way, we It is also estimated that graduating leading political rhetoric cannot need to know certain basic principles students will likely change careers change the basic principles of supply

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00019 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.006 S07PT1 S2130 CONGRESSIONAL RECORD — SENATE March 7, 2005 and demand. The majority of econo- single or are the sole breadwinner in a two children comes close to matching mists continue to affirm the job-killing household with no children. And they the 1968 value Democrats claim they nature of mandated wage increases. lack skills. They have minimum skills. are targeting. A recent poll concluded that 77 per- They get paid for minimum skills. As my colleagues are no doubt aware, cent—that is nearly 17,000 economists— Research shows that the poor tar- the earned income credit is a Federal believe that a minimum wage hike geting and other unintended con- income tax credit for low-income work- causes job loss. The argument these sequences of the minimum wage make ers that reduces the amount of tax an economists understand is this: By re- it terribly ineffective at reducing pov- individual owes, and is frequently re- quiring employers to pay a higher wage erty in America—the intended purpose turned in the form of a refund. This for positions they consider entry level, of the policy. In fact, two Stanford can supplement incomes by as much as the mandate forces employers to University economists concluded that $4,290, for a single adult with two de- search for higher skilled employees. a minimum wage increase is paid for by pendents which works out to a cash Moreover, mandated higher entry-level higher prices that hurt poor families credit equal to more than $2 per hour wages force employers to redefine the the most. paid directly to the worker. nature of the job and the expectations A 2001 study conducted by Stanford For every dollar in wages earned by a they have for their entry-level work- University economists found that only low-income family with two children, ers. Unskilled and low-skilled workers one in four of the poorest 20 percent of the Federal Government provides a tax without the new qualifications will, families would benefit from an increase credit of 40 percent. therefore, be the first to be displaced in the minimum wage. Three in four of Workers with one child have an effec- and the last to be employed. the poorest workers would be hurt by a tive minimum wage rate of $6.90 per In short, Congress can mandate how wage hike because they would shoulder hour, $5.15 per hour, plus a 34-percent much employers pay entry-level em- the costs of the resulting higher prices. credit of $1.75 per hour. Artificial wage hikes drive prices up. ployees, but they cannot mandate Workers with two or more children They have to. You cannot pay the which workers employers pay. have an effective minimum wage rate Even Dr. Rebecca Blank, a former wages without it. Everything but Gov- of $7.22 per hour, $5.15 plus a 40-percent member of President Clinton’s Council ernment spending has to be paid for. To credit of $2.07 per hour. of Economic Advisers, has admitted pay a higher minimum wage and other As a household’s income rises above that without the earned-income credit wages that have to go up because of it around $15,000 per year, the earned in- there would be greater pressure to in- means prices have to be raised. We come credit begins to be phased out. crease the minimum wage, which has should not trick workers into thinking growing disemployment effects as it they are earning more when they still It would take a minimum wage in- rises, since it induces employers to cannot pay the bills at the end of the crease of around a dollar per hour to substitute away from less-skilled labor month. reach the ‘‘appropriate’’ 1968 rate, toward other technologies. As we discuss the Federal minimum when the earned income credit is ap- Let me repeat what President Clin- wage, we must keep in mind the dan- plied. ton’s Economic Adviser said, because gers, also, of a ‘‘Washington knows The earned income credit has re- this is something proponents on the best’’ and a ‘‘one size fits all’’ men- tained the value of the minimum wage Senate floor are unwilling to meet. tality. An increase in the Federal min- for employed workers with families by Minimum wage increases induce em- imum wage is a classic lesson that supplementing their income while ployers to substitute away the less- Washington does not know best and avoiding the adverse effects of min- skilled labor toward other tech- that one size does not fit all. A Federal imum wage hikes. In fact, using the nologies. Low-skilled workers will be wage mandate does not account for the earned income credit allows us to more displaced and lose jobs or will not be cost of living that varies across the effectively target assistance to those hired in the first place. country. It costs over twice as much to workers raising families on low in- This massive Federal wage proposal live in New York City than it does in comes. is based on a false assumption that a Cheyenne, WY. However, a Federal Contrast this targeted policy with business that employs 50 minimum minimum wage hike that applies from massive increases in the minimum wage workers before this wage increase coast to coast is like saying a bag of wage that inefficiently distribute ‘‘as- is enacted will still employ 50 min- groceries in New York City must cost sistance’’ to individuals without chil- imum wage workers afterwards. the same as a bag of groceries in Chey- dren—mostly teenagers from wealthy Whether a business is in Washington or enne. Local labor market conditions families. In summary, the earned in- Wyoming, employers cannot absorb a and the cost of living determine pay come credit is ignored by wage-hike 41 percent increase in their costs with- rates, not Federal minimum wage laws proponents because it proves the flaws out a corresponding decrease in the dictated from Washington. in their arguments. Regardless of number of jobs or of benefits they can Incidentally, that is why Maine has a whether their arguments made sense in provide workers. higher wage rate than the Federal Gov- 1938, or even in 1968, their rhetoric has So we know there are losers when we ernment. That is why a lot of States been overridden by newer policies such raise the minimum wage, but who are have a higher rate. It fits their State. as the earned income credit. I prefer to the individuals who benefit? While The States can do it without our help. promote modern policies that help the minimum wage supporters often claim Isn’t that amazing. poor, and not to dwell on stale argu- the wage floor must be raised in order Now, proponents of a large, federally ments that no longer ring true. to lift employees out of poverty, this is mandated increase in the minimum My colleagues on the other side of simply not the case. Again, the average wage repeatedly state that the wage the aisle suggest that the only time family income of potential bene- floor is too low and that minimum low-income workers receive wage in- ficiaries from a $7.25-an-hour minimum wage earners earn below the poverty creases is when Congress mandates an wage rate is over $41,000 a year. Clear- line. This argument neglects to figure increase in the minimum wage. It is ly, the minimum wage is not a poverty in the effects of the earned-income preposterous and demeaning to argue level wage for most employees. credit. that only Congress can give low-wage Minimum wage earners who support Proponents of large minimum wage workers a pay raise. More often than a family solely based on the wage are increases argue that we should return not, it is the workers’ own dedication, actually few and far between. Fully 85 the starting wage to its 1968 value, hard work, and willingness to learn percent—this is very important—of the when the minimum wage was at its all- that results in their earning higher minimum wage earners live with their time high when adjusted for inflation. wages. Workers who were making the parents, have a working spouse, or are However, it is important to note, that minimum wage when it was last hiked living alone without children. Forty the real value of the current minimum in 1997 have learned job skills, received percent live with a parent or relative. wage in 2004 dollars plus the real value valuable experience, and, as a result, Twenty-one percent live with another of the Earned income credit for a full- have earned raises above the minimum wage earner. Twenty-four percent are time minimum wage employee with wage.

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00020 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.037 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2131 Whenever they seek to increase the I have heard on this floor a number Pinocchio’s. It is a wonderful res- minimum wage, the Democrats an- of times today people saying: It is taurant. nounce the number of workers who will pushing a drastic increase in the min- She has served me on a number of oc- ‘‘benefit’’ from the mandate. Interest- imum wage. The minimum wage was casions. She works hard, as does her ingly, however, that number has valid when it was initiated many years husband. But with a minimum wage shrunk dramatically over the past 6 ago. It is valid today. We should at job, she has trouble making ends meet years. least keep up with the cost of living. and affording basics, such as food, On September 3, 1998, Senator KEN- Using the logic of those who oppose the clothing, and housing. She has tried to NEDY issued a press release counting increase in the minimum wage with get ahead by taking classes at a com- the number of minimum-wage-increase these ‘‘drastic,’’ as they say, minimum munity college in the area, but she had beneficiaries at 12 million. That was wage increases, the longer you wait, to cut back because she could not af- when his wage hike went up to $6.65 per the less chance there would be to raise ford to go to school and also pay for hour instead of today’s $7.25 per hour it because it would become more ‘‘dras- what she needed to take care of her increase. Today, however, he puts the tic,’’ in their words, all the time. All family. She earns the minimum wage, number at only 7.5 million. That is 4.5 we are trying to do, all Senator KEN- plus her tips. million fewer workers affected by a NEDY is trying to do, is keep up with Now, I would say to my friend from minimum wage increase. Where did the cost of living. Wyoming, the employer is not going to they go? My friend, the distinguished Senator eliminate her job if the minimum wage Where did the other 4.5 million indi- from Wyoming, indicated that during is increased. He needs somebody to viduals go? They earned raises, on the short time we were in control—of wait those tables, and she is willing to their own, without Congress imposing course, a lot of the time we were in do this because she needs the work. a Federal wage hike. In fact, statistics charge there was no legislative busi- And the tips are not that bad. She is show that most minimum-wage work- ness going on, but keep in mind that trying to live the American dream by ers will earn raises in their first year every time we have attempted, no mat- going to school and getting ahead but on the job. These minimum-skilled ter who is in the majority in the last 8 unable to do it because the minimum workers will earn raises as their skills years, the Republicans have stopped it, wage in this country is not enough and experience increase. either through an actual filibuster or money. Her story is like many others we I share the same goal as Senator through some parliamentary maneu- have all heard, if we listen—stories of KENNEDY—to help American workers ver. They have opposed raising the families caught in the cycle of poverty, find and keep well-paying jobs. Min- minimum wage. imum skills—not minimum wages—are I think the logic of so doing, that it a cycle we can begin to end today by increasing the minimum wage. the problem. Education and training is a ‘‘drastic’’ increase—I repeat— An increase in the minimum wage will solve that problem and lead to the means that the longer you wait until will help 7 million Americans. This you attempt to raise the minimum kind of increased wages and better jobs may not sound like a lot of money, but wage, the less chance it would have to we all want to create for our Nation’s to these people it is a lot of money. An pass because it would become, in their workers. Lets get the Workforce In- increase of this size can help a family minds, more drastic. Think of the poor vestment Act passed and conferenced heat their home, pay for transpor- so the President can sign it and get people who are trying to earn a living tation to work, or can help a mother higher skills training accelerated. with this minimum wage. It becomes afford childcare so she does not have to The PRESIDING OFFICER (Mr. very drastic for them. worry about her kids while she is away. BURR). The Senator’s time has expired. I was heartened last week to see my The majority is calling to increase Mr. ENZI. Mr. President, it is a false Republican colleagues express their the minimum wage to $6.25 and further economy, and if we really wanted to commitment to addressing the issue of attempting to end the 40-hour work- raise it, we would have done something poverty. Press conferences were held. week with what they call flextime. with the Workforce Investment Act, But I believe the time has come for These measures are unacceptable. the job training. We would have raised them to back up their words with ac- Raise the minimum wage, not play skills, and then employees would have tion and vote to increase the minimum games with making it easier for em- been compensated well. wage to $7.25 an hour. It is not going to ployers to stagger the work of employ- I yield the floor. happen. We understand that the march- ees. They have already, through the The PRESIDING OFFICER. The ing orders have been given, and they President, eliminated overtime in Democratic leader is recognized. will all walk up here and vote against many instances. Mr. REID. Mr. President, I will use increasing the minimum wage. First, a nominal increase in the min- leader time for this presentation. In a country that values work and imum wage will help millions of Amer- The PRESIDING OFFICER. Without the opportunity to get ahead, a hard icans. This is important. Ending the 40- objection, it is so ordered. day’s work should bring a decent day’s hour workweek, replacing it with flex- Mr. REID. Mr. President, I have not pay, whether it is an entry-level job or time, would deny over 10 million min- been on the floor all day to listen to a job that is a more skilled job. In imum wage workers the ability to earn the debate, but I have listened to part America, this is not the case as it re- overtime pay. of it. I am stunned by some of the re- lates to entry-level work. We have We can do better. Helping our fami- marks by those opposed to raising the mothers and fathers working full time lies live more productive lives must be minimum wage. To indicate that peo- in minimum wage jobs but still living our top priority. Providing workers a ple who are drawing minimum wage in poverty, still struggling to get wage that is consistent with the rising live with their parents or others—they ahead. cost of living is both fair and just. I do because they make so little money. I met with some of these workers in urge my colleagues to pass this in- And all the denigration of these entry- Nevada last month. When you talk crease in the minimum wage. level jobs—these are jobs that people with them, you begin to understand The distinguished Senator from Mas- have to have filled. They may be low, that increasing the minimum wage is sachusetts has spent a lifetime in the entry-level jobs, but they are jobs peo- not about helping teenagers earn more national legislature helping people who ple need. People are not hiring these from their summer jobs, it is about don’t have lobbyists. When Senators people out of the goodness of their helping families realize the promise of walk up to this door here—sometimes heart, to say: Well, here is somebody. America. This fact was driven home we come in by subway—many times we We’ll hire a few minimum wage em- during a conversation I had with a are overwhelmed by lobbyists, so many ployees. woman from Reno named Natasha. She that we can’t work our way through There are a few people like that, but is married, has a child, and works as a them. But we will not see lobbyists the reason you have these minimum server in a popular restaurant. She here representing minimum wage wage jobs is because people need re- works hard. In fact, the restaurant is workers. sults. The employer needs the work one of my favorites. It is in a little I send to my friend through the Chair done. The employee needs the job. strip mall. The restaurant is called my appreciation for a lifetime of work

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00021 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.010 S07PT1 S2132 CONGRESSIONAL RECORD — SENATE March 7, 2005 helping those who don’t have lobbyists, A vote for the Santorum amendment The question is on agreeing to people who are working like Natasha is a vote for a pay cut for workers who amendment No. 44. trying to make ends meet. The min- rely on tips—waitresses, taxi drivers, The clerk will call the roll. imum wage should be increased. It is a and hairdressers. This is contrary to The legislative clerk called the roll. shame that we have to fight for it so our values as Americans. We believe Mr. MCCONNELL. The following Sen- hard. Frankly, we have not been suc- that work should have a reward. The ators were necessarily absent. cessful for 8 years. I say to my friend— Santorum amendment dishonors that. The Senator from Nevada (Mr. EN- and I don’t like to hear myself say It is an insult to the low-wage workers SIGN) and the Senator from Pennsyl- this—they have their marching orders of this country. vania (Mr. SPECTER). over there. We are going to lose again. The amendment I offer is about ev- Mr. DURBIN. I announce that the The people who are in these entry- erything that we stand for as a nation. Senator from Montana (Mr. BAUCUS), level jobs are again going to be without It is about opportunity. It ensures that the Senator from North Dakota (Mr. an increase. There are people out there every American at least has the oppor- CONRAD), and the Senator from Mary- who had hope. I am sorry. The march- tunity to move up and achieve the land (Ms. MIKULSKI) are necessarily ab- ing orders have been given, and there American dream. It is about fairness. sent. will be no increase. What is fair about working hard 52 The PRESIDING OFFICER. Are there The PRESIDING OFFICER. The Sen- weeks of the year and still living in any other Senators in the Chamber de- ator from Massachusetts. poverty? What is fair when Members of siring to vote? Mr. KENNEDY. Mr. President, how Congress raise their own salaries seven The result was announced—yeas 46, much time remains? times, by $28,000, over the last 8 years nays 49, as follows: The PRESIDING OFFICER. The Sen- and refuse to vote for an increase in [Rollcall Vote No. 26 Leg.] ator has 8 minutes. the minimum wage? What is fair about YEAS—46 Mr. KENNEDY. I ask the Chair to let that? What is fair about executives me know when I have used 7 minutes. who pay themselves millions of dollars Akaka Dorgan Lincoln Mr. President, we have had a good Bayh Durbin Murray but can’t find a way to pay a decent Biden Feingold Nelson (FL) discussion with my friend and col- minimum wage? Bingaman Feinstein Nelson (NE) league, the Senator from Pennsylvania. It is about making our economy Boxer Harkin Obama During the course of the debate, I did Byrd Inouye Pryor work for everyone, not just the privi- Cantwell Jeffords mention that a range of different leged few. There is no doubt that this Reed Carper Johnson Reid groups are supporting our position. I Chafee Kennedy is one of the central moral questions of Rockefeller Clinton Kerry will include those endorsements in the our time. It is how we treat the least of Salazar Coleman Kohl ECORD Sarbanes R . One I would like to mention is those among us. It is why religious Corzine Landrieu from the Catholic Bishops. This is their leaders have supported a minimum Dayton Lautenberg Schumer position: wage increase. The Santorum amend- DeWine Leahy Stabenow Wyden The Catholic Bishops have been long time ment fails the fundamental obligations Dodd Levin Domenici Lieberman supporters of the minimum wage. In Catholic of a just and fair society. Under the teaching, the principle of a living wage is in- guise of raising the minimum wage, it NAYS—49 tegral to our understanding of human work. cuts overtime pay and leaves out too Alexander Dole Murkowski Wages must be adequate for workers to pro- many individuals. Allard Enzi Roberts vide for themselves and their families in dig- Who are these minimum wage work- Allen Frist Santorum nity. Because the minimum wage is not a Bennett Graham Sessions living wage, the Catholic Bishops have sup- ers? First of all, they are men and Bond Grassley Shelby ported increasing the minimum wage over women of dignity. They assist in the Brownback Gregg Smith Bunning Hagel the decades. classrooms every day to teach the chil- Snowe Burns Hatch Stevens We are aware that some accommodations dren. They work in nursing homes to Burr Hutchison Sununu are being offered to alleviate possible ad- help care for the elderly who have sac- Chambliss Inhofe Talent verse effects on small businesses . . . that Coburn Isakson rificed for their children and have Thomas might occur with a modest increase in the Cochran Kyl made such a difference for this coun- Thune minimum wage. However, other changes and Collins Lott try. This issue is about women working Cornyn Lugar Vitter modification being contemplated that will Voinovich affect overtime pay or the 40 hour workweek in our society, because a majority of Craig Martinez those who will benefit from this min- Crapo McCain Warner are unwarranted and unwise. Other workers DeMint McConnell should not lose minimum wage protection or imum wage increase are women. It is a overtime pay as the price of increasing the women’s issue. It is a children’s issue NOT VOTING—5 wages of America’s lowest paid workers. At because a third of those women have Baucus Ensign Specter the very least, such changes to the Fair children. It is a children’s and a wom- Conrad Mikulski Labor Standards Act should be considered in en’s issue—and a family issue. It is a The PRESIDING OFFICER. Under the formal legislative process, not attached civil rights issue because so many of the previous order, the amendment not to a popular increase in the minimum wage the men and women who receive the as a condition of passage. having garnered 60 votes in the affirm- minimum wage are men and women of ative, the Senate action on this amend- They indicate their support for our color. And most of all, it is a fairness amendment. ment is vitiated and the amendment is issue. withdrawn. In just a few moments the Senate If there is a value which the Amer- VOTE ON AMENDMENT NO. 128 will have an opportunity to vote either ican people understand, it is fairness. in favor of the Santorum amendment The American people believe if you The PRESIDING OFFICER. The or my amendment. I believe a vote for work 40 hours a week, 52 weeks of the question is on agreeing to amendment the Santorum amendment is a vote to year, you should not have to live in No. 128. deny the minimum wage to more than poverty. They are living in poverty Mr. SANTORUM. I ask for the yeas 10 million workers. Those workers are today with the second lowest minimum and nays. looking to us for a fair raise to reward wage in nearly the last 60 years. The PRESIDING OFFICER. Is there a their hard work and to help care for The amendment I offer will provide a sufficient second? their families. helping hand to men and women of dig- There is a sufficient second. But the Santorum amendment takes nity to live in a decent and fair re- The clerk will call the roll. away their minimum wage rights en- spect. The assistant legislative clerk called tirely. A vote for the Santorum amend- I hope the Senate will accept it. the roll. ment is a vote to deny overtime pay to I yield back my time and ask for the Mr. DURBIN. I announce that the more than 10 million workers. These yeas and nays. Senator from Maryland (Ms. MIKULSKI) workers rely on overtime pay to make The PRESIDING OFFICER. Is there a is necessarily absent. ends meet, and overtime pay is com- sufficient second? The PRESIDING OFFICER. Are there pensation for many long hours away There appears to be a sufficient sec- any other Senators in the Chamber de- from their families. ond. siring to vote?

VerDate Aug 04 2004 01:57 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00022 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.041 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2133 The result was announced—yeas 38, ‘‘(bb) alimony, child, and spousal support Section 1325(b) of title 11, United States nays 61, as follows: payments; Code, as amended by this Act, is further ‘‘(cc) legal fees necessary for the debtor’s amended by adding at the end the following: [Rollcall Vote No. 27 Leg.] case; ‘‘(5) In determining disposable income, the YEAS—38 ‘‘(dd) pension payments; court shall not consider amounts the debtor Allen Frist Santorum ‘‘(ee) religious and charitable contribu- receives or is entitled to receive from— Bennett Graham Sessions tions; ‘‘(A) any refund of tax due to the debtor Brownback Grassley Shelby ‘‘(ff) union dues; under subtitle A of the Internal Revenue Bunning Hagel Smith ‘‘(gg) other expenses necessary for the op- Code of 1986 for any taxable year to the ex- Burns Hatch Snowe tent that the refund does not exceed the Coleman Hutchison eration of a business of the debtor or for the Specter debtor’s employment; amount of an applicable earned income tax Craig Kyl Stevens ‘‘(hh) ownership costs for 1 motor vehicle credit allowed by section 32 of the Internal Crapo Lugar Talent DeWine Martinez Revenue Code of 1986 for such year and the Thomas (or 2 in the case of a joint filing), determined Dole McCain amount of an applicable child tax credit al- Thune in accordance with Internal Revenue Service Domenici McConnell lowed under section 24 of such Code for such Voinovich transportation standards, reduced by any Ensign Murkowski payments on debts secured by the motor ve- year; Enzi Roberts Warner hicle or vehicle lease payments made by the ‘‘(B) any advance payment for an earned NAYS—61 debtor; income tax credit described in subparagraph (A); or Akaka Corzine Levin ‘‘(ii) expenses for children’s toys and recre- Alexander Dayton Lieberman ation for children of the debtor, tax credits ‘‘(C) child support, foster care, or disability Allard DeMint Lincoln for earned income determined under section payment for the care of a dependent child in Baucus Dodd Lott 32 of the Internal Revenue Code of 1986; and accordance with applicable nonbankruptcy Bayh Dorgan Murray ‘‘(jj) miscellaneous and emergency ex- law.’’. Biden Durbin Nelson (FL) penses.’’. (f) EXEMPTIONS.—Section 522(d)(10) of title Bingaman Feingold Nelson (NE) (b) DEFINITION OF CURRENT MONTHLY IN- 11, United States Code, as amended by this Bond Feinstein Obama Act, is further amended— Boxer Gregg COME.—Section 101(10A)(B) of title 11, United Pryor (1) in subparagraph (C), by inserting ‘‘or’’ Burr Harkin States Code, as amended by this Act, is fur- Reed after the semicolon; Byrd Inhofe ther amended by inserting ‘‘payments re- Cantwell Inouye Reid ceived as domestic spousal obligations,’’ (2) by striking subparagraph (D); and Carper Isakson Rockefeller after ‘‘Social Security Act,’’. (3) by striking ‘‘(E)’’ and inserting ‘‘(D)’’. Salazar Chafee Jeffords (c) PROPERTY OF THE ESTATE.—Section 541 (g) PERSONAL PROPERTY.— Chambliss Johnson Sarbanes of title 11, United States Code, as amended (1) SECTION 521.—Section 521(a)(6) of title 11, Schumer Clinton Kennedy by this Act, is further amended— United States Code, as amended by this Act, Coburn Kerry Stabenow is further amended by striking ‘‘of personal Cochran Kohl Sununu (1) in subsection (a)(5)(B) by inserting ‘‘ex- cept as provided under subsection (b)(11),’’ property’’ and inserting ‘‘of an item of per- Collins Landrieu Vitter sonal property purchased for more than Conrad Lautenberg Wyden before ‘‘as a result’’; and Cornyn Leahy (2) in subsection (b)— $3,000’’. (A) in paragraph (8), by striking ‘‘or’’ after (2) SECTION 362.—Section 362(h)(1) of title 11, NOT VOTING—1 the semicolon; United States Code, as amended by this Act, Mikulski (B) in paragraph (9), by striking the period is further amended by striking ‘‘to personal at the end and inserting a semicolon; and property’’ and inserting ‘‘to an item of per- The PRESIDING OFFICER. Under sonal property purchased for more than the previous order, the amendment not (C) by inserting after paragraph (9) the fol- lowing: $3,000’’. having garnered 60 votes in the affirm- (h) RESTORING THE FOUNDATION FOR SE- ‘‘(10) any— ative, the Senate action on this amend- CURED CREDIT.—Section 1325(a) of title 11, ‘‘(A) refund of tax due to the debtor under United States Code, as amended by this Act, ment is vitiated and the amendment is subtitle A of the Internal Revenue Code of withdrawn. is further amended in the flush matter at the 1986 for any taxable year to the extent that end by striking ‘‘if the debt was incurred’’ The Democratic leader. the refund does not exceed the amount of an and inserting ‘‘to the extent that the debt AMENDMENT NO. 19 WITHDRAWN applicable earned income tax credit allowed was incurred to purchase that thing of Mr. REID. On behalf of Senator FEIN- under section 32 of such Code for such year value’’. and the amount of an applicable child tax STEIN, I ask unanimous consent that (i) HOUSEHOLD GOODS.— credit allowed under section 24 of such Code amendment No. 19 be withdrawn. (1) DEFINITION.—Section 101 of title 11, for such year; and United States Code, as amended by this Act, The PRESIDING OFFICER. Without ‘‘(B) advance payment for an earned in- is further amended— objection, it is so ordered. come tax credit described in subparagraph (A) by redesignating paragraph (27A) as The Senator from Connecticut. (A); or paragraph (27B); and AMENDMENT NO. 67 ‘‘(11) the right of the debtor to receive do- (B) by inserting before paragraph (27B) the Mr. DODD. Mr. President, I ask unan- mestic spousal obligations for the debtor or following: imous consent that the pending amend- dependent of the debtor.’’. ‘‘(27A) ‘household goods ’— (d) PROTECTION OF EARNED INCOME TAX ‘‘(A) includes tangible personal property ment be laid aside and that amendment CREDIT AND SUPPORT PAYMENTS UNDER BANK- normally found in or around a residence; and No. 67 be called up, the reading of the RUPTCY REPAYMENT PLANS IN CHAPTER 12.— ‘‘(B) does not include motor vehicles used amendment be dispensed with, and the Section 1225(b) of title 11, United States for transportation purposes;’’. amendment laid aside so that the next Code, as amended by this Act, is further (2) FOR PURPOSES OF SECTION 522.—Section amendment may be called up. amended by adding at the end the following: 522(f) of title 11, United States Code, as The PRESIDING OFFICER. Without ‘‘(3) In determining disposable income, the amended by this Act, is further amended by court shall not consider amounts the debtor objection, it is so ordered. striking paragraph (4). receives or is entitled to receive from— (j) LIMITATION ON LUXURY GOODS.—Section The amendment is as follows: ‘‘(A) any refund of tax due to the debtor 523(a)(2)(C)(i) of title 11, United States Code, AMENDMENT NO. 67 under subtitle A of the Internal Revenue as amended by this Act, is further amended— (Purpose: To modify the bill to protect Code of 1986 for any taxable year to the ex- (1) in subclause (I)— families, and for other purposes) tent that the refund does not exceed the (A) by striking ‘‘$500’’ and inserting amount of an applicable earned income tax At the end of the bill, add the following: ‘‘$1,000’’; credit allowed under section 32 of the Inter- (B) by striking ‘‘90’’ and inserting ‘‘70’’; TITLE XVI—MODIFICATIONS FOR THE nal Revenue Code of 1986 for such year and and PROTECTION OF FAMILIES the amount of an applicable child tax credit (C) by inserting ‘‘if the creditor proves by SEC. 1601. MODIFICATIONS FOR THE PROTEC- allowed under section 24 of such Code for a preponderance of the evidence at a hearing TION OF FAMILIES. such year; that the goods or services were not reason- (a) DISMISSAL OR CONVERSION.—Section ‘‘(B) any advance payment for an earned ably necessary for the maintenance or sup- 707(b)(2)(A)(ii) of title 11, United States Code, income tax credit described in subparagraph port of the debtor or the dependents of the as amended by this Act, is further amended— (A); or debtor’’ after ‘‘nondischargeable’’; and (1) in subclause (IV), by striking ‘‘$1,500’’ ‘‘(C) child support, foster care, or disability (2) in subclause (II)— and inserting ‘‘$5,000’’; and payment for the care of a dependent child in (A) by striking ‘‘$750’’ and inserting (2) by adding at the end the following: accordance with applicable nonbankruptcy ‘‘$1,225’’; and ‘‘(VI) In addition, the debtor’s monthly ex- law.’’. (B) by striking ‘‘70’’ and inserting ‘‘60’’. penses shall include— (e) PROTECTION OF EARNED INCOME TAX (k) EXCEPTIONS TO DISCHARGE.—Section 523 ‘‘(aa) taxes and mandatory withholdings CREDIT AND SUPPORT PAYMENTS UNDER BANK- of title 11, United States Code, as amended from wages; RUPTCY REPAYMENT PLANS IN CHAPTER 13.— by this Act, is further amended—

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(1) in subsection (c), by inserting ‘‘or administrator, if any), trustee, or other Nearly 71⁄2 million workers will di- (14)(A),’’ after ‘‘or (6)’’ each place it appears; party in interest may file a motion under rectly benefit from this minimum wage and paragraph (2)’’ and inserting ‘‘Paragraph (2) increase while 8 million more will ben- (2) in subsection (d), by striking ‘‘(a)(2)’’ does not apply, and the court may not dis- efit indirectly. That is a total of 151⁄2 and inserting ‘‘(a)(2) or (14A)’’. miss a case based on any form of means test- ing,’’. million Americans who would get a AMENDMENTS NOS. 68 THROUGH 72, AND 119 raise due to this legislation and would Mr. DODD. Mr. President, I ask unan- AMENDMENT NO. 119 (Purpose: To amend section 502(b) of title 11, enable a working family to afford al- imous consent that the pending amend- most 2 more years of childcare, full tui- ment be laid aside and, on behalf of United States Code, to limit usurious claims in bankruptcy) tion for a community college degree, Senator KENNEDY, that amendments and many other staples for a healthy Nos. 68, 69, 70, 71, 72 and 119 be called up On page 45, strike lines 22 through 24, and insert the following: standard of living. Unfortunately, the in turn, that reading of each amend- (a) REDUCTION OF CLAIM.—Section 502 of current minimum wage fails to meet ment be dispensed with, that each title 11, United States Code, is amended— these standards. amendment be laid aside so that the (1) in subsection (b)— I thank the Chair and yield the floor. next amendment may be called up. (A) in paragraph (8), by striking ‘‘or’’ at The PRESIDING OFFICER. The Sen- the end; The PRESIDING OFFICER. Without ator from Hawaii. objection, it is so ordered. (B) in paragraph (9), by striking the period at the end and inserting ‘‘; or’’; and AMENDMENT NO. 105 The amendments are as follows: (C) by adding at the end the following: Mr. AKAKA. Mr. President, I ask AMENDMENT NO. 68 ‘‘(10) such claim is for a credit transaction unanimous consent that the pending (Purpose: To provide a maximum amount for involving a consumer (as defined in section amendments be set aside so that I may a homestead exemption under State law) 103(h) of the Truth in Lending Act (15 U.S.C. offer an amendment. On page 191, between lines 11 and 12, insert 1602(g))), and the interest included as part of The PRESIDING OFFICER. Without the following: such claim exceeds the maximum amount al- lowed by the laws of the State, Territory, or objection, it is so ordered. (c) FURTHER LIMITATION ON HOMESTEAD EX- Mr. AKAKA. Mr. President, I call up EMPTION.—Section 522(b) of title 11, United District in which the debtor resides.’’; and States Code, is amended by adding at the end (2) by adding at the end the following: amendment No. 105. the following: VOTE EXPLANATION The PRESIDING OFFICER. The ‘‘(5) Notwithstanding any other provision Mr. SPECTER. Mr. President, I have clerk will report. of this section, the maximum amount of a sought recognition to comment on the The legislative clerk read as follows: homestead exemption that may be provided last two votes. I had traveled with the The Senator from Hawaii [Mr. AKAKA] pro- under State law shall be $300,000.’’. President to Pittsburgh, PA today so poses an amendment numbered 105. AMENDMENT NO. 69 that I was absent during the vote on Mr. AKAKA. I ask unanimous con- (Purpose: To amend the definition of current the Kennedy amendment. Had I been sent that reading of the amendment be monthly income) present, I would have voted for the dispensed with. On page 20, line 16, strike ‘‘Act,’’ and insert Kennedy amendment. I arrived 7 min- The PRESIDING OFFICER. Without ‘‘Act, income from any job in which the utes into the vote on the Santorum objection, it is so ordered. debtor is no longer employed, income from amendment. I would like to have made The amendment is as follows: any activity which the debtor can no longer the vote for the first amendment but engage in due to disability,’’. AMENDMENT NO. 105 voted for the Santorum amendment. As (Purpose: To limit claims in bankruptcy by AMENDMENT NO. 70 between the two, my preference would certain unsecured creditors) (Purpose: To exempt debtors whose financial have been the Kennedy amendment be- problems were caused by failure to receive On page 45, strike lines 22 through 24, and alimony or child support, or both, from cause it raised the minimum wage insert the following: 1 means testing) more, and after a 7 ⁄2 year hiatus, it (a) REDUCTION OF CLAIM.—Section 502 of seemed to me that that amendment title 11, United States Code, is amended— On page 19, between lines 13 and 14, insert (1) in subsection (b)— the following: was in order. I commend Senator KENNEDY for his (A) in paragraph (8), by striking ‘‘or’’ at ‘‘(8)(A) No judge, United States trustee (or the end; bankruptcy administrator, if any), trustee, continuing efforts on the minimum wage, and I commend my distinguished (B) in paragraph (9), by striking the period or other party in interest may file a motion at the end and inserting ‘‘; or’’; and under paragraph (2) if the debtor, in any con- colleague for his efforts which bridged (C) by adding at the end the following: secutive 12-month period during the 2 years a considerable gap. I wanted to explain ‘‘(10) such consumer debt is an unsecured before the date of the filing of the petition, or comment for the record why I was claim arising from a debt to a creditor that failed to receive alimony or child support in- absent on the Kennedy amendment but does not have, as of the date of the order for come, or both, that such debtor was entitled present on the Santorum amendment, relief, a policy of waiving additional interest to receive pursuant to a valid court order, even though I would have preferred the for all debtors who participate in a debt totaling an amount in excess of 35 percent of management plan administered by a non- the debtor’s household income for such 12- Kennedy amendment to the Santorum amendment. But I would have in any profit budget and credit counseling agency month period.’’. described in section 111(a).’’; and AMENDMENT NO. 71 event voted for both of them. (2) by adding at the end the following: The last time Congress voted to raise (Purpose: To strike the provision relating to Mr. AKAKA. Mr. President, I ask the presumption of luxury goods) the minimum wage was in 1996, raising it from $4.25 to $4.75 to eventually $5.15. unanimous consent that my amend- Beginning on page 155, strike line 3 and all ment be set aside. that follows through page 156, line 5. Since 2000, the number of Americans in poverty has increased by 4.3 million for The PRESIDING OFFICER. Without AMENDMENT NO. 72 a grand total of 36 million people, objection, it is so ordered. (Purpose: To ensure that families below me- The Senator from Wisconsin. dian income are not subjected to means which includes 13 million children. AMENDMENTS NOS. 87 THROUGH 101 test requirements) Among full-time, year-round workers, Mr. FEINGOLD. Mr. President, I On page 28, between lines 21 and 22, insert poverty has doubled since the late 1970s the following: from about 1.3 million then to more have filed a number of amendments to this bill, most of which I believe are SEC. 102A. PROTECTION OF FAMILIES BELOW ME- than 2.6 million. Since 1981 on 10 dif- DIAN INCOME. ferent occasions, I have voted to in- germane and therefore can be offered Section 707(b) of title 11, United States crease the minimum wage. and debated and voted on even if clo- Code, as amended by section 102, is further History clearly demonstrates that ture is invoked tomorrow. I wanted to amended— raising the minimum wage has no ad- make sure that my amendments have (1) in paragraph (2)(C), by striking ‘‘cal- verse impact on jobs, employment, or been called up prior to cloture so that culated’’ and inserting ‘‘calculated, except inflation. In the 4 years after the last I am assured of getting a vote on any that a debtor described in paragraph (7) need minimum wage increase passed, the amendment that is germane. It is not only provide the calculations or other infor- mation showing that the debtor meets the economy experienced its strongest my intention to debate these amend- standards of such paragraph’’; and growth in over three decades. More ments tonight. That is what this re- (2) in paragraph (7)(A), by striking ‘‘No than 11 million new jobs were added, at quest is designed to do, merely to allow judge, United States trustee (or bankruptcy the pace of 232,000 per month. my germane amendments to be voted

VerDate Aug 04 2004 05:00 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00024 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.011 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2135 on prior to a vote on final passage of Subtitle B—Small Business Bankruptcy or the debtor is required to give shall be the bill. Provisions given at the address contained in the credi- I ask unanimous consent that the SEC. 431. SCHEDULING CONFERENCES. tor’s notice of address. ‘‘(f)(1) An entity may file with any bank- Section 105(d) of title 11, United States pending amendment be laid aside and ruptcy court a notice of address to be used Code, is amended— that each of my amendments Nos. 87 by all the bankruptcy courts or by particular (1) in the matter preceding paragraph (1), through 101 be called up in turn, that bankruptcy courts, as so specified by such by striking ‘‘, may’’; and the reading of each amendment be dis- entity at the time such notice is filed, to (2) by striking paragraph (1) and inserting provide notice to such entity in all cases pensed with, and each amendment in the following: under chapters 7 and 13 pending in the courts turn be laid aside so that another ‘‘(1) shall hold such status conferences as amendment can become the pending with respect to which such notice is filed, in are necessary to further the expeditious and which such entity is a creditor. business, and that the last amendment economical resolution of the case; and’’. ‘‘(2) In any case filed under chapter 7 or 13, in the list then be laid aside so that the SEC. 432. SERIAL FILER PROVISIONS. any notice required to be provided by a court amendment that is now pending is Section 362 of title 11, United States Code, with respect to which a notice is filed under again the pending business. as amended by sections 106, 305, and 311, is paragraph (1), to such entity later than 30 The PRESIDING OFFICER. Without amended— days after the filing of such notice under objection, it is so ordered. (1) in subsection (k), as so redesignated by paragraph (1) shall be provided to such ad- The amendments are as follows:’ section 305— dress unless with respect to a particular case (A) by striking ‘‘An’’ and inserting ‘‘(1) Ex- a different address is specified in a notice AMENDMENT NO. 87 cept as provided in paragraph (2), an’’; and filed and served in accordance with sub- (Purpose: To amend section 104 of title 11, (B) by adding at the end the following: section (e). United States Code, to include certain pro- ‘‘(2) If such violation is based on an action ‘‘(3) In any case filed under chapter 7 or 13, visions in the triennial inflation adjust- taken by an entity in the good faith belief any notice required to be provided by any ment of dollar amounts) that subsection (h) applies to the debtor, the party in interest with respect to which a no- On page 445, strike lines 10 through 13, and recovery under paragraph (1) of this sub- tice is filed under paragraph (1), to such enti- insert the following: section against such entity shall be limited ty later than 120 days after the filing of such notice under paragraph (1) shall be provided SEC. 1202. ADJUSTMENT OF DOLLAR AMOUNTS. to actual damages.’’; and to such address unless with respect to a par- Section 104(b) of title 11, United States (2) by adding at the end the following: ticular case a different address is specified in Code, as amended by this Act, is further ‘‘(n)(1) Except as provided in paragraph (2), subsection (a) does not apply in a case in a notice filed and served in accordance with amended— subsection (e). (1) by inserting ‘‘101(19A),’’ after ‘‘101(18),’’ which the debtor— ‘‘(A) is a debtor in a small business case ‘‘(4) A notice filed under paragraph (1) may each place it appears; be withdrawn by such entity. (2) by inserting ‘‘522(f)(3),’’ after ‘‘522(d),’’ pending at the time the petition is filed; ‘‘(B) was a debtor in a small business case ‘‘(g)(1) Notice given to a creditor other each place it appears; than as provided in this section is not effec- (3) by inserting ‘‘541(b), 547(c)(9),’’ after that was dismissed for any reason by an order that became final in the 2-year period tive until that notice has been brought to ‘‘523(a)(2)(C),’’ each place it appears; the attention of the creditor. If the creditor ending on the date of the order for relief en- (4) in pagagraph (1), by striking ‘‘and designates a person or department to be re- tered with respect to the petition; 1325(b)(3)’’ and inserting ‘‘1322(d), 1325(b), and sponsible for receiving notices concerning ‘‘(C) was a debtor in a small business case 1326(b)(3) of this title and section 1409(b) of bankruptcy cases by a filing in accordance in which a plan was confirmed in the 2-year title 28’’; and with subsection (d) or (e) and establishes rea- period ending on the date of the order for re- (5) in paragraph (2), by striking ‘‘and sonable procedures so that bankruptcy no- lief entered with respect to the petition; or 1325(b)(3) of this title’’ and inserting ‘‘1322(d), tices received by the creditor are actually ‘‘(D) is an entity that has acquired sub- 1325(b), and 1326(b)(3) of this title and section delivered to the person or department, notice stantially all of the assets or business of a 1409(b) of title 28’’. is not considered to have been brought to the small business debtor described in subpara- attention of the creditor until that person or AMENDMENT NO. 88 graph (A), (B), or (C), unless such entity es- (Purpose: To amend the plan filing and department receives the notice. tablishes by a preponderance of the evidence ‘‘(2) The court may not impose either a confirmation deadlines) that such entity acquired substantially all of sanction under section 362(h) or a sanction Beginning on page 230, strike line 7 and all the assets or business of such small business that a court may otherwise impose on ac- that follows through page 231, line 6, and in- debtor in good faith and not for the purpose count of a violation of the stay under section sert the following: of evading this paragraph. 362(a) or a failure to comply with section 542 ‘‘(e) In a small business case— ‘‘(2) Paragraph (1) does not apply— or 543 on account of any action of the cred- ‘‘(1) only the debtor may file a plan until ‘‘(A) to an involuntary case involving no itor unless the action occurs after the cred- after 180 days after the date of the order for collusion by the debtor with creditors; or itor has received either notice of the com- relief, unless that period is— ‘‘(B) to the filing of a petition if— mencement of the case effective under this ‘‘(A) extended as provided by this sub- ‘‘(i) the debtor proves by a preponderance section or other actual notice reasonably section, after notice and a hearing; or of the evidence that the filing of the petition calculated to come to the attention of the ‘‘(B) the court, for cause, orders otherwise; resulted from circumstances beyond the con- creditor, the creditor’s attorney, the credi- ‘‘(2) the plan and a disclosure statement (if trol of the debtor not foreseeable at the time tor’s agent taking the action, or other appro- any) shall be filed not later than 300 days the case then pending was filed; and priate person.’’. after the date of the order for relief, unless ‘‘(ii) it is more likely than not that the AMENDMENT NO. 91 that period is— court will confirm a feasible plan, but not a ‘‘(A) extended as provided by this sub- liquidating plan, within a reasonable period (Purpose: To amend section 303 of title 11, section, after notice and a hearing; or of time.’’. United States Code, with respect to the sealing and expungement of court records ‘‘(B) the court, for cause, orders otherwise; AMENDMENT NO. 90 and relating to fraudulent involuntary bank- (Purpose: To amend the provision relating to ruptcy petitions) ‘‘(3) the time periods specified in para- fair notice given to creditors) graphs (1) and (2), and the time fixed in sec- On page 205, between lines 16 and 17, insert tion 1129(e) within which the plan shall be Beginning on page 167, strike line 3 and all the following: confirmed, may be extended only if— that follows through page 169, line 25, and in- SEC. 332. FRAUDULENT INVOLUNTARY BANK- ‘‘(A) the debtor, after providing notice to sert the following: RUPTCY. parties in interest (including the United (a) NOTICE.—Section 342 of title 11, United (a) SHORT TITLE.—This section may be States trustee), demonstrates by a prepon- States Code, is amended— cited as the ‘‘Involuntary Bankruptcy Im- derance of the evidence that it is more likely (1) in subsection (c), by adding before the provement Act of 2005’’. than not that the court will confirm a plan period at the end the following: ‘‘unless the (b) INVOLUNTARY CASES.—Section 303 of within a reasonable period of time; creditor cannot with reasonable effort iden- title 11, United States Code, is amended by ‘‘(B) a new deadline is imposed at the time tify the account to which the notice applies adding at the end the following: ‘‘(l)(1) If— the extension is granted; and without the information required by this ‘‘(A) the petition under this section is false ‘‘(C) the order extending time is signed be- subsection’’; and or contains any materially false, fictitious, fore the existing deadline has expired.’’. (2) by adding at the end the following: ‘‘(e) At any time in a case under chapter 7 or fraudulent statement; AMENDMENT NO. 89 or 13 concerning an individual debtor, a cred- ‘‘(B) the debtor is an individual; and (Purpose: To strike certain small business itor may file with the court and serve on the ‘‘(C) the court dismisses such petition, related bankruptcy provisions in the bill) debtor a notice of the address to be used for the court, upon the motion of the debtor, Beginning on page 221, strike line 1 and all service of notice on the creditor in that case. shall seal all the records of the court relat- that follows through page 240, line 4, and in- Beginning 10 days after the creditor files and ing to such petition, and all references to sert the following: serves the notice, any notice that the court such petition.

VerDate Aug 04 2004 04:56 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00025 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.047 S07PT1 S2136 CONGRESSIONAL RECORD — SENATE March 7, 2005 ‘‘(2) If the debtor is an individual and the ‘‘(3) misrepresent to any assisted person or ‘‘(A) enjoin the violation of such section; court dismisses a petition under this section, prospective assisted person, directly or indi- or the court may enter an order prohibiting all rectly, affirmatively or by material omis- ‘‘(B) impose an appropriate civil penalty consumer reporting agencies (as defined in sion, with respect to— against such person. section 603(f) of the Fair Credit Reporting ‘‘(A) the services that such agency will ‘‘(d) No provision of this section, section Act (15 U.S.C. 1681a(f))) from making any provide to such person; or 527, or section 528 shall— consumer report (as defined in section 603(d) ‘‘(B) the benefits and risks that may result ‘‘(1) annul, alter, affect, or exempt any per- of that Act) that contains any information if such person becomes a debtor in a case son subject to such sections from complying relating to such petition or to the case com- under this title; or with any law of any State except to the ex- menced by the filing of such petition. ‘‘(4) advise an assisted person or prospec- tent that such law is inconsistent with those ‘‘(3) Upon the expiration of the statute of tive assisted person to incur more debt in sections, and then only to the extent of the limitations described in section 3282 of title contemplation of such person filing a case inconsistency; or 18, for a violation of section 152 or 157 of such under this title or to pay an attorney or ‘‘(2) be deemed to limit or curtail the au- title, the court, upon the motion of the debt- bankruptcy petition preparer fee or charge thority or ability— or and for good cause, may expunge any for services performed as part of preparing ‘‘(A) of a State or subdivision or instru- records relating to a petition filed under this for or representing a debtor in a case under mentality thereof, to determine and enforce section.’’. this title. qualifications for the practice of law under (c) BANKRUPTCY FRAUD.—Section 157 of ‘‘(b) Any waiver by any assisted person of the laws of that State; or title 18, United States Code, is amended by any protection or right provided under this ‘‘(B) of a Federal court to determine and inserting ‘‘, including a fraudulent involun- section shall not be enforceable against the enforce the qualifications for the practice of tary bankruptcy petition under section 303 of debtor by any Federal or State court or any law before that court.’’. such title’’ after ‘‘title 11’’. other person, but may be enforced against a (b) CONFORMING AMENDMENT.—The table of AMENDMENT NO. 92 debt relief agency. sections for chapter 5 of title 11, United ‘‘(c)(1) Any contract for bankruptcy assist- (The amendment is printed in today’s States Code, is amended by inserting after ance between a debt relief agency and an as- the item relating to section 525, the fol- RECORD under ‘‘Text of Amendments.’’) sisted person that does not comply with the lowing: AMENDMENT NO. 93 material requirements of this section, sec- ‘‘526. Restrictions on debt relief agencies.’’. (Purpose: To modify the disclosure require- tion 527, or section 528 shall be void and may SEC. 228. DISCLOSURES. ments for debt relief agencies providing not be enforced by any Federal or State (a) DISCLOSURES.—Subchapter II of chapter bankruptcy assistance) court or by any other person, other than 5 of title 11, United States Code, as amended On page 112, strike line 17 and all that fol- such assisted person. ‘‘(2) Any debt relief agency shall be liable by section 227, is amended by adding at the lows through page 120, line 24, and insert the end the following: following: to an assisted person in the amount of any ‘‘§ 527. Disclosures ‘‘(12A) ‘debt relief agency’ means any per- fees or charges in connection with providing son, other than an attorney or an employee bankruptcy assistance to such person that ‘‘(a) A debt relief agency providing bank- of an attorney, who provides any bankruptcy such debt relief agency has received, for ac- ruptcy assistance to an assisted person shall assistance to an assisted person in return for tual damages, and for reasonable attorneys’ provide— the payment of money or other valuable con- fees and costs if such agency is found, after ‘‘(1) the written notice required under sec- sideration, or who is a bankruptcy petition notice and a hearing, to have— tion 342(b)(1); and preparer under section 110, but does not in- ‘‘(A) intentionally or negligently failed to ‘‘(2) to the extent not covered in the writ- clude— comply with any provision of this section, ten notice described in paragraph (1), and not ‘‘(A) any person who is an officer, director, section 527, or section 528 with respect to a later than 3 business days after the first date employee, or agent of a person who provides case or proceeding under this title for such on which a debt relief agency first offers to such assistance or of the bankruptcy peti- assisted person; provide any bankruptcy assistance services tion preparer; ‘‘(B) provided bankruptcy assistance to an to an assisted person, a clear and con- ‘‘(B) a nonprofit organization that is ex- assisted person in a case or proceeding under spicuous written notice advising assisted empt from taxation under section 501(c)(3) of this title that is dismissed or converted to a persons that— the Internal Revenue Code of 1986; case under another chapter of this title be- ‘‘(A) all information that the assisted per- ‘‘(C) a creditor of such assisted person, to cause of such agency’s intentional or neg- son is required to provide with a petition and the extent that the creditor is assisting such ligent failure to file any required document thereafter during a case under this title is assisted person to restructure any debt owed including those specified in section 521; or required to be complete, accurate, and truth- by such assisted person to the creditor; ‘‘(C) intentionally or negligently dis- ful; ‘‘(D) a depository institution (as defined in regarded the material requirements of this ‘‘(B) all assets and all liabilities are re- section 3 of the Federal Deposit Insurance title or the Federal Rules of Bankruptcy quired to be completely and accurately dis- Act) or any Federal credit union or State Procedure applicable to such agency. closed in the documents filed to commence credit union (as those terms are defined in ‘‘(3) In addition to such other remedies as the case, and the replacement value of each section 101 of the Federal Credit Union Act), are provided under State law, whenever the asset as defined in section 506 must be stated or any affiliate or subsidiary of such deposi- chief law enforcement officer of a State, or in those documents where requested after tory institution or credit union; or an official or agency designated by a State, reasonable inquiry to establish such value; ‘‘(E) an author, publisher, distributor, or has reason to believe that any person has ‘‘(C) current monthly income, the amounts seller of works subject to copyright protec- violated or is violating this section, the specified in section 707(b)(2), and, in a case tion under title 17, when acting in such ca- State— under chapter 13 of this title, disposable in- pacity.’’. ‘‘(A) may bring an action to enjoin such come (determined in accordance with section violation; (b) CONFORMING AMENDMENT.—Section 707(b)(2)), are required to be stated after rea- 104(b) of title 11, United States Code, is ‘‘(B) may bring an action on behalf of its sonable inquiry; and amended by inserting ‘‘101(3),’’ after ‘‘sec- residents to recover the actual damages of ‘‘(D) information that an assisted person tions’’ each place it appears. assisted persons arising from such violation, provides during their case may be audited including any liability under paragraph (2); pursuant to this title, and that failure to SEC. 227. RESTRICTIONS ON DEBT RELIEF AGEN- CIES. and provide such information may result in dis- ‘‘(C) in the case of any successful action missal of the case under this title or other (a) ENFORCEMENT.—Subchapter II of chap- ter 5 of title 11, United States Code, is under subparagraph (A) or (B), shall be sanction, including a criminal sanction. ‘‘(b) A debt relief agency providing bank- amended by adding at the end the following: awarded the costs of the action and reason- able attorneys’ fees as determined by the ruptcy assistance to an assisted person shall ‘‘§ 526. Restrictions on debt relief agencies court. provide each assisted person at the same ‘‘(a) A debt relief agency shall not— ‘‘(4) The district courts of the United time as the notices required under sub- ‘‘(1) fail to perform any service that such States for districts located in the State shall section (a)(1) the following statement, to the agency informed an assisted person or pro- have concurrent jurisdiction of any action extent applicable, or one substantially simi- spective assisted person it would provide in under subparagraph (A) or (B) of paragraph lar. The statement shall be clear and con- connection with a case or proceeding under (3). spicuous and shall be in a single document this title; ‘‘(5) Notwithstanding any other provision separate from other documents or notices ‘‘(2) make any statement, or counsel or ad- of Federal law and in addition to any other provided to the assisted person: vise any assisted person or prospective as- remedy provided under Federal or State law, ‘‘ ‘IMPORTANT INFORMATION ABOUT sisted person to make a statement in a docu- if the court, on its own motion or on the mo- BANKRUPTCY ASSISTANCE SERVICES ment filed in a case or proceeding under this tion of the United States trustee or the debt- FROM A BANKRUPTCY PETITION PRE- title, that is untrue and misleading, or that or, finds that a person intentionally violated PARER. upon the exercise of reasonable care, should this section, or engaged in a clear and con- ‘‘ ‘If you decide to seek bankruptcy relief, have been known by such agency to be un- sistent pattern or practice of violating this you can represent yourself, you can hire an true or misleading; section, the court may— attorney to represent you, or you can get

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help in some localities from a bankruptcy AMENDMENT NO. 96 AMENDMENT NO. 97 petition preparer who is not an attorney. (Purpose: To amend the provisions relating (Purpose: To amend the provisions relating THE LAW REQUIRES A BANKRUPTCY PE- to chapter 13 plans to have a 5-year dura- to chapter 13 plans to have a 5-year dura- TITION PREPARER TO GIVE YOU A WRIT- tion in certain cases and to amend the defi- tion in certain cases and to amend the defi- TEN CONTRACT SPECIFYING WHAT THE nition of disposable income for purposes of nition of disposable income for purposes of BANKRUPTCY PETITION PREPARER chapter 13) chapter 13) WILL DO FOR YOU AND HOW MUCH IT On page 182, between lines 3 and 4, insert WILL COST. Ask to see the contract before Beginning on page 24, strike line 16 and all the following: you hire anyone.’’’ that follows through page 26, line 7, and in- sert the following: SEC. 318A. APPLICABILITY OF MEANS TEST AND AMENDMENT NO. 94 ‘‘(2)(A) For purposes of this subsection, the PLANS TO HAVE A 5-YEAR DURATION IN CERTAIN CASES. (Purpose: To clarify the application of the term ‘disposable income’ means current (a) APPLICABILITY OF MEANS TEST TO CHAP- term disposable income) monthly income received by the debtor (other than child support payments, foster TER 13.—Section 1325(b) of title 11, United Beginning on page 24, strike line 9 and all care payments, or disability payments for a States Code, as amended by this Act, is fur- that follows through page 26, line 7, and in- dependent child made in accordance with ap- ther amended— sert the following: plicable nonbankruptcy law to the extent (1) in paragraph (2), by inserting ‘‘or, if (h) APPLICABILITY OF MEANS TEST TO CHAP- reasonably necessary to be expended for such lower and not likely to increase substan- TER 13.—Section 1325(b) of title 11, United child) less amounts reasonably necessary to tially in the 2 months after the order for re- States Code, is amended by striking para- be expended— lief, the debtor’s monthly income on the date graph (2) and inserting the following: ‘‘(i)(I) for the maintenance or support of of the order for relief under this chapter’’ ‘‘(2) For purposes of this subsection, the the debtor or a dependent of the debtor, or after ‘‘received by the debtor’’; term ‘disposable income’ means current for a domestic support obligation, that first (2) in paragraph (3), by inserting ‘‘(or, if monthly income received by the debtor becomes payable after the date the petition lower and not likely to increase substan- (other than child support payments, foster is filed; and tially in the 2 months after the order for re- care payments, or disability payments for a ‘‘(II) for charitable contributions (that lief, the debtor’s monthly income on the date dependent child made in accordance with ap- meet the definition of ‘charitable contribu- of the order for relief under this chapter)’’ plicable nonbankruptcy law to the extent tion’ under section 548(d)(3) to a qualified re- after ‘‘if the debtor has current monthly in- reasonably necessary to be expended for such ligious or charitable entity or organization come’’; and child) less amounts reasonably necessary to (as defined in section 548(d)(4)) in an amount (3) in paragraph (4)— be expended— not to exceed 15 percent of gross income of (A) in subparagraph (A)(ii), by striking ‘‘(A)(i) for the maintenance or support of the debtor for the year in which the con- ‘‘debtor and the debtor’s spouse combined’’ the debtor or a dependent of the debtor, or tributions are made; and and inserting ‘‘debtor, and in a joint case the for a domestic support obligation, that first ‘‘(ii) if the debtor is engaged in business, debtor and the debtor’s spouse, or, if lower becomes payable after the date the petition for the payment of expenditures necessary and not likely to increase substantially in is filed; and for the continuation, preservation, and oper- the 2 months after the order for relief, the ‘‘(ii) for charitable contributions (that ation of such business. monthly income on the date of the order for meet the definition of ‘charitable contribu- ‘‘(B) However, the debtor’s disposable in- relief under this chapter’’; tion’ under section 548(d)(3) to a qualified re- come may be adjusted if the debtor dem- (B) in subparagraph (A)(ii)(III), by striking ligious or charitable entity or organization onstrates special circumstances that justify ‘‘and’’ after the semicolon; (as defined in section 548(d)(4)) in an amount adjustments of current monthly income for (C) in subparagraph (B), by striking the pe- not to exceed 15 percent of gross income of which there is no reasonable alternative, as riod at the end and inserting ‘‘; and’’; and the debtor for the year in which the con- described in section 707(b)(2)(B) of this title. (D) by adding at the end the following: tributions are made; and ‘‘(3)(A) Amounts reasonably necessary to ‘‘(C) provided that if the debtor’s income ‘‘(B) if the debtor is engaged in business, be expended under paragraph (2) shall be de- decreases during the case to less than the for the payment of expenditures necessary termined in accordance with subparagraphs amount set forth in subparagraph (A)(ii), and for the continuation, preservation, and oper- (A) and (B) of section 707(b)(2), if the debtor is not likely again to exceed that amount ation of such business. has current monthly income, when multi- within 1 month, may be reduced to 3 years.’’. ‘‘(3) Amounts reasonably necessary to be plied by 12, greater than— (b) CHAPTER 13 PLANS TO HAVE A 5-YEAR expended under paragraph (2)(A)(i), shall be ‘‘(i) in the case of a debtor in a household DURATION IN CERTAIN CASES.—Section 1322(d) determined in accordance with subpara- of 1 person, the median family income of the of title 11, United States Code, as amended graphs (A) and (B) of section 707(b)(2), if the applicable State for 1 earner; by this Act, is further amended— debtor has current monthly income, when ‘‘(ii) in the case of a debtor in a household (1) in paragraph (1), by striking ‘‘debtor multiplied by 12, greater than— of 2, 3, or 4 individuals, the highest median and the debtor’s spouse combined’’ and in- ‘‘(A) in the case of a debtor in a household family income of the applicable State for a serting ‘‘debtor, and in a joint case the debt- of 1 person, the median family income of the family of the same number or fewer individ- or and the debtor’s spouse, or, if lower and applicable State for 1 earner; uals; or not likely to increase substantially in the 2 ‘‘(B) in the case of a debtor in a household ‘‘(iii) in the case of a debtor in a household months after the order for relief, the month- of 2, 3, or 4 individuals, the highest median exceeding 4 individuals, the highest median ly income on the date of the order for relief family income of the applicable State for a family income of the applicable State for a under this chapter’’; and family of the same number or fewer individ- family of 4 or fewer individuals, plus $525 per (2) in paragraph (2), by striking ‘‘debtor uals; or month for each individual in excess of 4. and the debtor’s spouse combined’’ and in- ‘‘(C) in the case of a debtor in a household ‘‘(B) However, this paragraph shall not serting ‘‘debtor, and in a joint case the debt- exceeding 4 individuals, the highest median apply if the debtor demonstrates special cir- or and the debtor’s spouse, or, if lower and family income of the applicable State for a cumstances that justify adjustments of cur- not likely to increase substantially in the 2 family of 4 or fewer individuals, plus $525 per rent monthly income for which there is no months after the order for relief, the month- month for each individual in excess of 4.’’. reasonable alternative, as described in sec- ly income on the date of the order for relief tion 707(b)(2)(B) of this title, and which bring under this chapter’’. AMENDMENT NO. 95 the debtor’s income below the applicable AMENDMENT NO. 98 (Purpose: To amend the provisions relating amount set forth in this paragraph.’’. (Purpose: To modify the disclosure require- to the discharge of taxes under chapter 13) (i) REDUCTION OF THE TERM OF THE PLAN ments for debt relief agencies providing On page 265, between lines 18 and 19, insert FOR CERTAIN DEBTORS.—Section 1329 of title bankruptcy assistance) the following: 11, United States Code, is amended by adding On page 112, line 17, insert ‘‘, other than an at the end the following: attorney or an employee of an attorney’’ SEC. 707A. DISCHARGE UNDER CHAPTER 13. ‘‘(d) Notwithstanding paragraphs (1)(B) and after ‘‘any person’’. Section 1328(a) of title 11, United States (4) of section 1325(b), if the actual income of On page 120, lines 12 and 13, strike ‘‘AN AT- Code, as amended by this Act, is further the debtor, or in a joint case the debtor and TORNEY OR’’ and insert ‘‘A’’. amended— the debtor’s spouse, has dropped below the On page 120, line 19, strike ‘‘AN ATTOR- (1) in paragraph (2), by striking ‘‘(1)(B), applicable amount stated in section NEY OR’’ and insert ‘‘A’’. (1)(C),’’; 1325(b)(3), either before or after the petition, On page 120, lines 21 and 22, strike ‘‘AT- (2) in paragraph (3), by striking ‘‘or’’ after and is unlikely to increase above such TORNEY OR’’. the semicolon; amounts within 1 year, the debtor’s plan AMENDMENT NO. 99 (3) in paragraph (4), by striking the period may be modified to reduce the term of the at the end and inserting ‘‘; or’’; and plan to a time period equal to or greater (Purpose: To provide no bankruptcy protec- (4) by adding at the end the following: than the applicable commitment period in tion for insolvent political committees) ‘‘(5) for taxes with respect to which the section 1325(b)(4)(A)(i) and the debtor shall On page 205, between lines 16 and 17, insert debtor filed a fraudulent return.’’. not be subject to section 1325(b)(3).’’. the following:

VerDate Aug 04 2004 04:56 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00027 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.028 S07PT1 S2138 CONGRESSIONAL RECORD — SENATE March 7, 2005 SEC. 332. NO BANKRUPTCY FOR INSOLVENT PO- Mr. SESSIONS. I will not object. ‘‘(A) such transfer was made to a self-set- LITICAL COMMITTEES. The PRESIDING OFFICER. Without tled trust or similar device; Section 109 of title 11, United States Code, objection, it is so ordered. ‘‘(B) such transfer was by the debtor; and is amended by adding at the end the fol- ‘‘(C) the debtor is a beneficiary of such AMENDMENT NO. 121 lowing: trust or similar device. ‘‘(i) A political committee subject to the Mr. TALENT. Mr. President, I ask ‘‘(2) Paragraph (1) shall not apply to the jurisdiction of the Federal Election Commis- unanimous consent that the pending trusts specified in section 522(d)(12).’’. sion under Federal election laws may not be amendment be set side and my amend- Mr. SCHUMER. Mr. President, I will a debtor under this title.’’. ment No. 121 be called up, the reading be very brief. Late last week, this AMENDMENT NO. 100 be dispensed with, and it then be set body, in its wisdom, defeated our (Purpose: To provide authority for a court to aside. amendment to close the millionaire’s order disgorgement or other remedies re- The PRESIDING OFFICER. Is there loophole, an amendment that would lating to an agreement that is not enforce- objection? able) allow certain trusts to be set up by Without objection, it is so ordered. anybody, but, of course, they are ex- On page 63, between lines 3 and 4, insert The amendment (No. 121) is as fol- pensive and only those very wealthy the following: lows: ‘‘(4) Nothing in this section shall preclude who have a purpose would do it and a court from ordering disgorgement of pay- (Purpose: To deter corporate fraud and pre- shield their assets in the trust and then ments accepted, or other remedies under this vent the abuse of State self-settled trust declare bankruptcy and shed their title or other applicable law, when a creditor law) debt. has accepted payments under such agree- On page 500, between lines 2 and 3, insert It meant that if you were very ment or in anticipation of such agreement the following: wealthy, and you could afford some and the agreement is not enforceable. (4) by adding at the end the following: ‘‘(e)(1) In addition to any transfer that the fancy lawyers, you were a lot better off AMENDMENT NO. 101 trustee may otherwise avoid, the trustee than somebody who went bankrupt who (Purpose: To amend the definition of small may avoid any transfer of an interest of the made $40,000, $45,000, $50,000, or $55,000. business debtor) debtor in property that was made on or with- I was hoping the amendment could Beginning on page 222, strike line 23 and in 10 years before the date of the filing of the have been adopted, but it was not. all that follows through page 223, line 21, and petition, if— After that point, a number of my col- insert the following: ‘‘(A) such transfer was made to a self-set- ‘‘(A) subject to subparagraph (B), means a leagues from the other side said, let’s tled trust or similar device; try to work something out. We tried person engaged in commercial or business ‘‘(B) such transfer was by the debtor; activities (including any affiliate of such ‘‘(C) the debtor is a beneficiary of such this morning but did not reach agree- person that is also a debtor under this title trust or similar device; and ment. So Senator TALENT, my friend and excluding a person whose primary activ- ‘‘(D) the debtor made such transfer with from Missouri, just offered his amend- ity is the business of owning or operating actual intent to hinder, delay, or defraud ment, which I regret to say does not real property or activities incidental there- any entity to which the debtor was or be- close the millionaire’s loophole at all. to) that has aggregate noncontingent liq- came, on or after the date that such transfer It is something of a subterfuge. There uidated secured and unsecured debts as of was made, indebted. the date of the petition or the date of the are two basic problems with it. ‘‘(2) For the purposes of this subsection, a First, you would have to prove that order for relief in an amount not more than transfer includes a transfer made in antici- $1,250,000 (excluding debts owed to 1 or more pation of any money judgment, settlement, the intent of the filer of the trust was affiliates or insiders) for a case in which the civil penalty, equitable order, or criminal to avoid bankruptcy. I do not have to United States trustee has not appointed fine incurred by, or which the debtor be- tell anyone here who is a lawyer that under section 1102(a)(1) a committee of unse- lieved would be incurred by— to prove that intent, especially when cured creditors or where the court has deter- ‘‘(A) any violation of the securities laws the filer would want to make sure that mined that the committee of unsecured (as defined in section 3(a)(47) of the Securi- intent could not be proven and would creditors is not sufficiently active and rep- ties Exchange Act of 1934 (15 U.S.C. leave no paper trail, no documents or resentative to provide effective oversight of 78c(a)(47))), any State securities laws, or any anything else, would be next to impos- the debtor; and regulation or order issued under Federal se- ‘‘(B) does not include any member of a curities laws or State securities laws; or sible. So in a sense, it would not close group of affiliated debtors that has aggre- ‘‘(B) fraud, deceit, or manipulation in a fi- the loophole at all. gate noncontingent liquidated secured and duciary capacity or in connection with the But there is a broader point. Whether unsecured debts in an amount greater than purchase or sale of any security registered the intent was to do it or not, why $1,250,000 (excluding debt owed to 1 or more under section 12 or 15(d) of the Securities Ex- should someone be able to shield mil- affiliates or insiders);’’. change Act of 1934 (15 U.S.C. 78l and 78o(d)) lions of dollars of assets and declare Mr. SESSIONS. Mr. President, on the or under section 6 of the Securities Act of bankruptcy? We are trying to close unanimous consent request, reserving 1933 (15 U.S.C. 77f).’’. abuses here. Why are the abuses of the the right to object, I know the Senator AMENDMENT NO. 129 TO AMENDMENT NO. 121 wealthy any less worthy of being from Wisconsin has worked hard on the Mr. SCHUMER. Mr. President, I offer closed than, say, of the middle class, bankruptcy bill and has a number of a second-degree amendment to amend- someone who might gamble their mea- relevant, germane amendments. I know ment No. 121, proposed by Senator TAL- ger assets away? he cares about the bill. I think he ENT. This amendment removes the re- would like to see it die, but he wants to The PRESIDING OFFICER. The quirement that you must prove the in- make it better. How many amendments clerk will report. tent of setting up the trust was simply did he have? The legislative clerk read as follows: to avoid your assets being taken in Mr. FEINGOLD. Fifteen total. This is The Senator from New York [Mr. SCHUMER] bankruptcy, as well as doing one other not a number that I would actually proposes an amendment numbered 129 to thing. The amendment has another amendment No. 121. offer. I will be able to pare that list problem with it which deals with pen- down, but I wanted to preserve my Mr. SCHUMER. Mr. President, I ask sions, and our amendment corrects right to have any germane amendment unanimous consent that the reading of that as well. voted on postcloture. the amendment be dispensed with. Their amendment on pensions would Mr. SESSIONS. I have great respect The PRESIDING OFFICER. Without subject pensions to these rules, and we for the Senator from Wisconsin, and I objection, it is so ordered. do not want to do that. That is quite will not object if he will use his best The amendment is as follows: different than somebody hiding their judgment and try to avoid as many (Purpose: To limit the exemption for asset assets in these trusts. But some of votes as we can. protection trusts) these trusts are used by pension plans. Mr. FEINGOLD. Mr. President, I Beginning on page 1 of the amendment, We do not bring pension plans into it. have found the Senator very reasonable strike all after (4) and insert the following: In fact, we take them out. in working on these amendments. Cer- ‘‘(e)(1) In addition to any transfer that the The Talent amendment has kept the trustee may otherwise avoid, the trustee tainly some will not be offered, others may avoid any transfer of an interest of the pension proposal. I am sure we will be are not major amendments, others will debtor in property that was made on or with- debating the Talent amendment and require votes, but it will be a list sig- in 10 years before the date of the filing of the my second-degree amendment to the nificantly smaller than 15. petition, if— Talent amendment at some point as we

VerDate Aug 04 2004 02:12 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00028 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.036 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2139 move forward on the bankruptcy bill, Mr. SCHUMER. I thank my col- ‘‘(ii) performing a homeland defense activ- but I wanted to let my colleagues know league, and I yield the floor. ity (as defined in section 901(1) of title 32). what has happened. The PRESIDING OFFICER. The Sen- AMENDMENT NO. 26, AS MODIFIED I yield the floor. ator from Illinois. Mr. DURBIN. Mr. President, on be- The PRESIDING OFFICER. The Sen- AMENDMENTS NOS. 110, 111, 112 half of Senator LEAHY, I send a modi- ator from Alabama. Mr. DURBIN. Mr. President, I ask fication of amendment 26 to the desk. Mr. SESSIONS. Mr. President, will unanimous consent that the pending This amendment has been cleared on the Senator from New York yield for a amendment be set aside for the purpose both sides. question? of offering en bloc amendments Nos. The PRESIDING OFFICER. Is there Mr. SCHUMER. I will be happy to 110, 111, and 112. objection to the modification? yield for a question. The PRESIDING OFFICER. Is there The PRESIDING OFFICER. Without Mr. SESSIONS. Mr. President, we objection? objection, it is so ordered. The amend- went through a debate last time over Without objection, it is so ordered. ment will be so modified. the retirement benefits, the savings The amendments are as follows: The amendment (No. 26), as modified, is as follows: plans. I thought we capped those at $1 AMENDMENT NO. 110 (Purpose: To restrict access to certain per- million. (Purpose: To clarify that the means test does My question to the Senator from New sonal information in bankruptcy docu- not apply to debtors below median income) ments) York, Mr. President, is, how confident On page 18, strike line 1 and all that fol- is he under the bankruptcy bill as writ- On page 132, between lines 5 and 6, insert lows through ‘‘(2)’’ on line 3, and insert the the following: ten that these trusts will be held by following: SEC. 234. PROTECTION OF PERSONAL INFORMA- bankruptcy judges as not subject to (7)(A) Notwithstanding paragraph (2), a TION. being part of the assets of the debtor’s debtor described in this paragraph need only (a) RESTRICTION OF PUBLIC ACCESS TO CER- provide the calculations or other informa- estate? Is this something about which TAIN INFORMATION CONTAINED IN BANKRUPTCY tion showing that the debtor meets the CASE FILES.—Section 107 of title 11, United the Senator from New York is con- standards of this paragraph. Paragraph (2) cerned? And we are not sure or do we States Code, is amended by adding at the end shall not apply, and the court may not dis- the following: have any law that will give the Senator miss a case based on any form of means test- ‘‘(c)(1) The bankruptcy court, for cause, cause to believe that they would not be ing, may protect an individual, with respect to captured as part of the estate? AMENDMENT NO. 111 the following types of information to the ex- Mr. SCHUMER. The lawyers we have (Purpose: To protect veterans and members tent the court finds that disclosure of such consulted have said it is pretty clear- of the armed forces on active duty or per- information would create undue risk of iden- cut that these assets would be held im- forming homeland security activities from tity theft or other unlawful injury to the in- mune from bankruptcy. But probably means testing in bankruptcy) dividual or the individual’s property: more important than my opinion, there On page 13, between lines 13 and 14, insert ‘‘(A) Any means of identification (as de- fined in section 1028(d) of title 18) contained was an article in the New York Times the following: ‘‘(D) Subparagraphs (A) through (C) shall in a paper filed, or to be filed, in a case under written by a Pulitzer Prize-winning au- this title. thor who is an expert on the Tax Code not apply, and the court may not dismiss or convert a case based on any form of means ‘‘(B) Other information contained in a who checked this out with many dif- testing, if— paper described in subparagraph (A). ‘‘(2) Upon ex parte application dem- ferent sources, as I read the article, ‘‘(i) the debtor or the debtor’s spouse is a onstrating cause, the court shall provide ac- and said it is pretty clear that these member of the armed forces— cess to information protected pursuant to assets would be held immune from ‘‘(I) on active duty (as defined in section paragraph (1) to an entity acting pursuant to 101(d)(1) of title 10); or bankruptcy. the police or regulatory power of a domestic ‘‘(II) performing a homeland defense activ- Let me remind my colleague, only governmental unit. five States allow the setting up of ity (as defined in section 901(1) of title 32); ‘‘(3) The United States trustee, bankruptcy these trusts, but neither Alabama nor ‘‘(ii) the debtor or the debtor’s spouse is a administrator, trustee, and any auditor serv- veteran (as defined in section 101(2) of title New York. Citizens in our States could ing under section 586(f) of title 28— 38), and the indebtedness occurred primarily ‘‘(A) shall have full access to all informa- set up these trusts in Utah. I do not re- during a period of not less than 180 days, dur- member all the other States. I remem- tion contained in any paper filed or sub- ing which he or she was— mitted in a case under this title; and ber Utah because Senator HATCH came ‘‘(I) on active duty (as defined in section ‘‘(B) shall not disclose information specifi- over to me and said: that is my State 101(d)(1) of title 10); or cally protected by the court under this you are picking on. They could set up ‘‘(II) performing a homeland defense activ- title.’’. these trusts, use the trusts in those ity (as defined in section 901(1) of title 32); (b) SECURITY OF SOCIAL SECURITY ACCOUNT States, and they would be immune ‘‘(iii) the debtor or the debtor’s spouse is a NUMBER OF DEBTOR IN NOTICE TO CREDITOR.— reserve of the armed forces, and the indebt- from bankruptcy, no matter what the Section 342(c) of title 11, United States Code, edness occurred primarily during a period of is amended— jurisdiction. not less than 180 days, during which he or Mr. SESSIONS. I thank the Senator (1) by inserting ‘‘last 4 digits of the’’ before she was— ‘‘taxpayer identification number’’; and from New York. It is a matter that ‘‘(I) on active duty (as defined in section (2) by adding at the end the following: ‘‘If could be significant, and I am glad we 101(d)(1) of title 10); or the notice concerns an amendment that adds are discussing it. ‘‘(II) performing a homeland defense activ- a creditor to the schedules of assets and li- Mr. SCHUMER. If my colleague will ity (as defined in section 901(1) of title 32); or abilities, the debtor shall include the full yield for a minute, I would prefer not ‘‘(iv) the debtor’s spouse died while serving taxpayer identification number in the notice to second degree the amendment of my as a member of the armed forces— sent to that creditor, but the debtor shall in- ‘‘(I) on active duty (as defined in section clude only the last 4 digits of the taxpayer friend from Missouri. I would like to 101(d)(1) of title 10); or come to a compromise that truly closes identification number in the copy of the no- ‘‘(II) performing a homeland defense activ- tice filed with the court.’’. this loophole. I know my friend from ity (as defined in section 901(1) of title 32). (c) CONFORMING AMENDMENT.—Section Iowa, the leader on this bill, had men- AMENDMENT NO. 112 107(a) of title 11, United States Code, is tioned in his remarks that he was in- (Purpose: To protect disabled veterans from amended by striking ‘‘subsection (b),’’ and terested in closing this. My colleague means testing in bankruptcy under certain inserting ‘‘subsections (b) and (c),’’. from Utah had mentioned that he was circumstances) Mr. LEAHY. Mr. President, the re- interested in closing this, and rather On page 13, between lines 13 and 14, insert cent debacles at ChoicePoint and Bank than having a debate on the amend- the following: of America remind us that we must ment of the Senator from Missouri and ‘‘(D) Subparagraphs (A) through (C) shall vigilantly protect our personal infor- my second degree, if we could come to not apply, and the court may not dismiss or mation at all points of vulnerability. a compromise that truly closes the convert a case based on any form of means The bankruptcy process, which inher- loophole without going further, I would testing, if the debtor is a disabled veteran (as defined in section 3741(1) of title 38), and the ently involves the exchange of highly be happy to do that. indebtedness occurred primarily during a pe- personal information, should be no dif- Mr. SESSIONS. I thank the Senator riod during which he or she was— ferent. for that offer and will look forward to ‘‘(i) on active duty (as defined in section This is a bipartisan amendment that taking him up on that. 101(d)(1) of title 10); or balances the need to protect personal

VerDate Aug 04 2004 04:56 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00029 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.052 S07PT1 S2140 CONGRESSIONAL RECORD — SENATE March 7, 2005 information with the needs of credi- Leahy amendment and urge its adop- court, only the last four digits of a per- tors, regulators and law enforcement tion by the Senate. This amendment is son’s social security number are re- to access critical information. The endorsed by the Judicial Conference of quired to be included in the documents. amendment is strongly supported by the United States, which is presided A separate filing with the full social se- the non-partisan Judicial Conference, over by Chief Justice Rehnquist, and to curity number will be sent privately to and also by the Center for Democracy which Congress regularly defers in the each party in interest in the bank- and Technology. writing of the rules of our Federal ruptcy proceeding. This amendment I am pleased that my colleagues Sen- court system. also creates an exception to ensure ator SNOWE and Senator CANTWELL Bankruptcy court filings, like most that law enforcement can gain access, have agreed to cosponsor this amend- other court proceedings, are public and it has the support of the Depart- ment, and that Chairman SPECTER and record, and most papers filed in these ment of Justice. Senator GRASSLEY worked so closely cases are publicly available record. Furthermore, I have worked closely with us to improve the amendment This is a good thing, because the ad- with the sponsors of the underlying even further. They have all been lead- ministration of justice in our country bill, which I support, to ensure that ers on privacy issues, and I appreciate should not be a secret affair. It is the this amendment does nothing to harm their support. public’s right to know how its courts the efficient functioning of the credit Our bipartisan amendment does two are meting out justice. The Bank- and banking industries. Credit report- things. It enhances court discretion to ruptcy Code affirmatively adopts this ing agencies often rely on taxpayer balance the need to know against the policy. identification numbers—most often so- need to protect personal information, At the same time, bankruptcy pro- cial security numbers—to determine a and it requires truncation of social se- ceedings are unique in that the explicit person’s creditworthiness. To ensure curity numbers in publicly filed docu- financial information of the debtor and accuracy in such credit reports, we ments. This protection is particularly its creditors are filed with the court, have modified the original language of important in an electronic filing envi- and likewise available for public re- this amendment to address the indus- ronment, where information once filed view. Such information includes not try’s concerns without in any way is immediately available to the public only a person’s name and address, but weakening the protections that we via the Internet. information such as the person’s social seek to enact. The new language The amendment allows the court, for security number, date of birth, driver’s strikes the appropriate balance for all cause, to protect personal information. license number, and electronic address- concerned, and I understand that the For example, the court can seal or re- es and routing codes. This information industry finds the modification accept- dact information, such as the home or has long been available for public re- able. Giving the sensitive nature of bank- employment address of a debtor, be- view at our Nation’s courthouses. How- ruptcy filings and the increased threat cause of a personal security risk, in- ever, in today’s information age, more of identity theft in today’s society, cluding fear of injury by a former and more Federal courts are making this is a common sense measure to the spouse or stalker. The amendment all of their public documents available underlying bankruptcy reform bill, would also give the court the leeway to on-line as well. While this is an ad- which I support. I am pleased that all vancement in efficiency in most re- protect other information normally sides have come to agreement, and that gards, it opens up a great potential for considered private, such as personal this amendment will be adopted. medical records. abuse for identity thieves and others Ms. CANTWELL. Mr. President, I Our bipartisan amendment still pro- who access the Internet with the intent want to thank my colleagues on the tects law enforcement and creditors to commit fraud, physical harm, or Senate Judiciary Committee and oth- where necessary. A law enforcement other crimes. ers who have worked together for many More and more agencies today gain provision ensures that police and regu- years, despite considerable differences lators can get needed information di- access to such personal information in the area of bankruptcy reform, to rectly from the bankruptcy court, and through publicly available documents. produce a bill that has passed the Sen- a creditor protection provision speci- And as the recent computer hacking ate a number of times. All that said, fies that creditors, including the IRS, incident at Choice Point Corporation the bill is far from perfect, and the receive the full Social Security number demonstrates, such personal informa- Senate should take full advantage of of a debtor in the initial notice of the tion can be obtained even from compa- this opportunity to take a number of case. Finally, we also clarify that these nies in the businesses of collecting and steps to amend this bill and improve it. protections should not limit the access securely storing such information. I have supported amendments that im- of the trustees, administrators and Moreover, access to such personal, sen- prove the bill in areas where it affects auditors to necessary information. sitive information could pose serious particularly vulnerable consumers and We must be careful that our efforts risks to victims of domestic abuse, retirees, and I believe we should also to require documentation for accuracy stalking, and other violent crime. Be- address incidents of corporate abuse. and accountability do not inadvert- cause any person with a computer can There are also ways to bring the bill up ently create problems for privacy and obtain these court documents, a per- to date with modern technology and security. As modified, the amendment son’s safety and the safety of her prop- crime. properly balances these concerns, and erty could be seriously put at risk. For example, I proudly join my col- protects the needs of those who need to Senator LEAHY, Senator CANTWELL, league from Vermont, Mr. LEAHY, in know. and I have devised this amendment to recommending to all my colleagues the This has been a cooperative, bi-par- help prevent these harmful invasions of pending Leahy-Cantwell-Snowe privacy tisan effort, I extend special thanks to privacy from ever occurring. Currently amendment, Amendment No. 26. This Senator SNOWE, Chairman SPECTER, the Bankruptcy Code allows courts to amendment is an appropriate response and Senator GRASSLEY for all their issue protective orders to prevent pub- to the recent erosion of informational hard-work in reaching an agreement, lic disclosure of trade secrets and con- privacy in our society, demonstrated and I am pleased to submit this modi- fidential research and commercial in- by the ChoicePoint and Bank of Amer- fication. formation. Our amendment would ex- ica personal informational security Ms. SNOWE. Mr. President, I support pand the court’s authority to provide breaches, where the personal informa- the amendment offered by my col- for similar protection of the personally tion of thousands of people was mis- league Senator LEAHY, to ensure that identifiable information that I just de- appropriated by identity thieves. the private, personal identification in- scribed, as well as give the court the Consumers should not have to sur- formation filed in bankruptcy pro- ability to shield other information if render their privacy rights, just to gain ceedings does not fall into the hands of its release would create an undue risk access to our Nation’s bankruptcy sys- identity thieves, violent stalkers, and of either identity theft or of injury to tem. There are a number of reasons other persons with criminal intentions. an individual’s person or property. It why it is simply sound practice for I, along with my colleague Senator further provides that when publicly bankruptcy courts to join other Fed- CANTWELL, join as cosponsors to the available notices are filed with the eral courts that already have a viable

VerDate Aug 04 2004 02:29 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00030 Fmt 0624 Sfmt 0634 E:\CR\FM\A07MR6.056 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2141 mechanism to file personal informa- Now for the second bill of the session, So they pushed hard for 10 years to get tion of debtors and others under seal. one of the highest priorities on the Re- this bill passed by the Senate in the Identity theft is a predictable outcome publican side of the aisle—they are hopes that fewer Americans will have when criminals have virtually unfet- pushing for the bankruptcy reform bill. an opportunity to start fresh and to tered access to an obvious public data- When one thinks of all the challenges start new. So we have been debating base of people who are already vulner- in America, the obvious question is, for over a week changes in this bill, able in public bankruptcy court files. why are we considering bankruptcy re- changes that were designed to take In some instances, a debtor might be a form before we would even consider into consideration special cir- battered woman, a victim of a stalker health care in America or doing some- cumstances. or another victim of domestic violence, thing about the economy creating jobs I give credit to my friends on the Re- and the disclosure of that person’s pri- or addressing the budget deficit in publican side of the aisle. They have vate information may subject her to America or even addressing Social Se- rejected every single change. Let me further abuse. Congress has recognized curity? Why is this bankruptcy bill say what they have rejected so far. I of- the need to render private such per- such a high priority? Well, the reason fered an amendment that said if one sonal information in court filings in is this bill makes fundamental changes served in the Guard or Reserve, if they much of the Federal court system, and in the law as to which Americans will are in the military and they are serv- this body should now add the bank- qualify for bankruptcy. ing their country overseas and as a re- ruptcy courts to the list of properly Bankruptcy, of course, was created in sult of their service their family or protected public entities. Although I the law of many civilized nations such their business goes into bankruptcy, recognize that bankruptcy courts have as the United States because in the old we are not going to be so harsh on some discretion to protect ‘‘scandalous days if one went deeply into debt they them. We are going to give them an or defamatory matter,’’ the point or could be put in prison. People decided easier time of it in bankruptcy because preserving privacy of this information that was barbaric. They said there their circumstances serving our coun- should also be to protect information should reach a point, if one cannot pay try, risking their lives for America, that could be used to injure the con- their debts, they can be exonerated or warrant better consideration than sumer, either financially or even phys- have those debts wiped clean from some other circumstances. I thought ically. It is also clear that such courts their record and start new, start fresh. that was a reasonable amendment. I do not have the same ability to do pro- That is what bankruptcy is all about. hear all my fellow Senators praising tect information for cause as do other Chapter 7 of the Bankruptcy Code is our men and women in uniform, how Federal courts. It is time to fix this un- that situation. One walks into the they are standing behind them. Well, I justifiable distinction between the pri- court and they say, here are all of my had veterans groups and military fam- vacy rights of litigants in one kind of debts, here are all of my assets, and the ily groups all supporting my amend- Federal court and another. I ask my court should basically liquidate what- ment. They said this is a reasonable colleagues to support Leahy-Cantwell- ever they have, pay off as much of the thing to do. A lot of people who are ac- Snowe, because people’s economic and debt as possible, and at the end of the tivated end up losing their businesses, even their physical security may be in day they walk out of the court without and they should be given some consid- jeopardy otherwise. Let’s not wait for much left on this Earth but without eration in bankruptcy court. the inevitable abuse of this loophole, any debts, wipe the slate clean. That is I lost that amendment 58 to 38. Every which could lead to stolen identities, bankruptcy. Republican Senator voted against it. I or physical harm, before we act. There are other provisions in the cannot quite understand why, but that I urge my colleagues to vote for the Bankruptcy Code, notably chapter 13. was their position. Leahy-Cantwell-Snowe amendment. Under chapter 13, one walks into court Then came Senator KENNEDY. Sen- Mr. DURBIN. Mr. President, I rise to and says: I have more debts than I can ator KENNEDY said we just did a survey, speak very briefly about the amend- pay, but I can pay something. The and the No. 1 reason people file bank- ments I have offered this evening to court then says: We will work out a ruptcy now is because of medical bills. the pending bankruptcy bill. I have schedule for what you will pay over a Senator KENNEDY said if someone has found as I traveled back in Illinois and period of time. That is chapter 13. So gone through a medical crisis in their around the country that some people one does not walk out with their debts life and they have medical bills they follow the C–SPAN floor debate very relieved, but they may walk out with cannot pay, we will at least say that closely. Just over this weekend, having fewer debts to pay and a schedule to when they go into bankruptcy court traveled to Arizona and Nevada, I am pay them. The court monitors their because of those bills, they can protect amazed to find people who heard my progress under chapter 13. So in chap- a small home, $150,000 home, which in speech on the bankruptcy bill, which ter 7, one walks out with the slate some communities in America would always intrigues me that so many peo- clean. Chapter 13, they walk out still be a very small home. It says that even ple suffer from insomnia that they paying off their debts. though one has been through an ill- watch C–SPAN gavel to gavel, but in In came the credit card companies ness, they had all of these medical all honesty I admire them for their in- and the major banks to Congress about bills, they have been forced into bank- terest in our Government, and I hope 10 years ago and said, we believe that ruptcy, they will have a roof over their that they follow this debate. But if one too many people are having the slate head. That amendment was rejected, is a newcomer to this bankruptcy bill wiped clean and that they should con- too. The thought that we would give debate, I will say a few words about the tinue to pay off their debts, even if people and their families facing med- bill and the amendments which I have they think they should be relieved of ical catastrophes a break to be able to offered. all liability. The purpose of this bill is keep a home was rejected. When it comes to the bill itself, to say that people walking into bank- I then offered an amendment that which is 510 pages, it will amend the ruptcy court are now going to have a said, what if the creditor is what we bankruptcy law of America. It is a bill much more difficult time wiping the call a predatory lender, somebody who which has been considered for years. slate clean to start over. More likely breaks the rules, breaks the law—for We have had versions of this bill over than not, particularly if they are mak- example, offers a second mortgage on a the last 9 or 10 years. I know because ing more than the median income in home at an unreasonable interest rate, years ago I worked with Senator America, which is not a huge, princely hidden charges, balloon payments that GRASSLEY on one of the first modifica- sum, the credit card industry comes in prey upon people like senior citizens— tions to the Bankruptcy Code. Some of and says, we want to make sure that if what are we going to do when they these changes passed the Senate and someone comes into court and wants to come to bankruptcy court? Why should failed in the House. Some have passed file bankruptcy, when it is all said and we allow them to take away the home the House and Senate and been vetoed done, they will still have credit card of a person if they have broken the law by President Clinton. The bill has had bills to pay, and not just credit card in giving the loan? its ups and downs. It never did become bills. They could be medical bills. They I thought that was pretty obvious. A law in that period of time. could be any number of different bills. person coming into bankruptcy court

VerDate Aug 04 2004 02:29 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00031 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.027 S07PT1 S2142 CONGRESSIONAL RECORD — SENATE March 7, 2005 as a creditor doesn’t have clean hands they are going to get more money out I am going to give my colleagues a if they have broken the law with the of people filing in bankruptcy court. chance to vote on that. loan they are trying to enforce. I Time and again in this debate, many The second thing we do is to return thought at least we would stand for the of my colleagues, whom I respect to the issue of veterans and members of law, that we would only enforce legal much, have said: Senator DURBIN, you the Armed Forces on active duty, and loans, not illegal loans. have it all wrong. If people make less whether they are going to be treated Rejected. It was rejected largely on a than the median income in America, the same in bankruptcy as other peo- party-line vote. Every Republican Sen- they will not be affected by this bill. ple. I will go back to the argument. I ator but one voted against it. They are going to be off the hook. You think if someone is serving our coun- As you can see, as we have gone have to be making over the median in- try, risking their lives for America, to through these amendments, whether come to possibly get into a situation protect me and my home, that we we are talking about men and women where you are going to have to pay off should do everything we can to help in the military, whether we are talking more of your debts. them. So we say, in this case, if your about people with medical bills, wheth- I have listened to that over and over. indebtedness as a veteran or a member er we are talking about victims of My staff and I, over the weekend, read of the military is primarily incurred predatory loans, even if we are talking the bill. It turns out that is not the while you are on active duty, that you about people who are victims of iden- case. In order to prove that you are can go into the bankruptcy court and tity theft—we are all following the below median income, you have to go escape the worst parts of the means news accounts of ChoicePoint where a through an expensive and extensive test. It is a way to consolidate some of lot of personal information has been process under this bill. So I felt that it the arguments made earlier and to try disclosed about individuals. It scares a was only reasonable to say to my col- to appeal to my friends on the Repub- lot of folks that someone will grab leagues: Why don’t we give those below lican side of the aisle, for one last their Social Security number and their median income a better chance to time, to be sensitive to some of the identity and run up some bills. It hap- prove that they should not be covered real hardships that have been created for families of Guardsmen and Reserves pens. Unfortunately it happens a lot. by the provisions in this bill? who have been activated. Senator BILL NELSON of Florida said We make clear in amendment No. 110 The last point is one I almost offer in if you are a victim of identity theft, that debtors in bankruptcy falling desperation, amendment No. 112. I can- you should be given a break in bank- below median income need only pro- not believe my colleagues have re- ruptcy court. They weren’t debts you vide calculations or other information jected all of these amendments when incurred; they were debts incurred by showing the debtor’s situation satisfies they relate to men and women in the someone who stole your identity. I the below-median-income standard. armed services, but the last amend- thought that was a reasonable amend- In other words, you don’t have to ment relates to disabled veterans, men ment, too. hire a lawyer. You don’t have to incur and women who become disabled as a Rejected. Every Republican voted thousands of dollars of legal debt if you result of their service in America and against it. They don’t want to take are below median income. You estab- face bankruptcy. It is a final appeal to into consideration the real-life trage- lish that to the court and then you my friends on both sides of the aisle: If dies and misfortunes that bring some- move forward. you cannot work up sympathy for men one into bankruptcy court. They want Second, the amendment says that a and women in uniform serving our to make sure that at the end of the day court may not dismiss a case based on country, at least have some concern for the credit card companies and the any forms of means testing if the cur- those who are disabled and come back major financial institutions will get rent monthly income of the debtor falls and face bankruptcy. Don’t put them more money from people walking into at or below the median family income through these unreasonable tests and bankruptcy court. of the applicable State. What the lan- standards in this bill. I would think all Senator AKAKA offered an amend- guage in my amendment does is rein- ment and said, shouldn’t these credit force every argument we have heard of us could agree that disabled veterans card companies disclose more in their from the other side of the aisle. Time should be given some sort of a helping monthly statements, these companies and again they have said: If you make hand in this bankruptcy process. So we will try again with the amend- that just inundate us with applications low income in America, you will not be ments that we offer. I know some of for credit cards? Shouldn’t their affected by this bill. them will be debated at length. I just monthly statements at least say: If We say: Fine, then let’s change the sincerely hope this week the supporters you make the minimum monthly pay- bill and clarify that so a person filing of this bill will at least take a little for bankruptcy doesn’t have to go ment, this is how long it will take to time and consider the possibility of through all of the pain and all of the pay off the loan and here is how much amending this bill. you will pay in interest? Is that unrea- expense of filing all the documents re- To my knowledge, the only perfect sonable? I don’t think it is. quired under this bill. law that was ever written were the Ten These companies are making huge We had a program under President Commandments, and they were not amounts of money. In 2003 the credit Clinton not that long ago called the written by Senators. They were written card companies made $30 billion in COPS Program—you may remember by somebody in higher office. profit. it—bringing more police back to the This bill, as good as it may be, can be So Senator AKAKA offered an amend- communities of America. It was a wild- better. It should be better. It should be ment that said at least these credit ly successful program. It brought thou- more sensitive to some of the real- card monthly statements should tell sands of policemen to the State of Illi- world challenges that we face. I hope the consumer more so they make the nois and many other States. We ended we will consider these amendments fa- right choices for themselves and their up having a one-page application for vorably, enact them soon, and make families. that program. We prided ourselves on them part of this legislation. It will Rejected, again, on a party-line vote, the fact that we were not absolutely make a bill which I think is unfair in with only one Senator from the Repub- swamping people in communities with many respects a lot fairer. lican side of the aisle voting for it. all kinds of Federal paperwork and ap- AMENDMENT NO. 26, AS MODIFIED You think to yourself, if you can’t plications. With one page you could One last thing. I ask unanimous con- hold the credit card companies to even qualify for a COPS grant in your com- sent the Leahy-Snowe privacy amend- that minimum standard, what is this munity. ment No. 26, as modified, be accepted. debate all about? We are not creating What we are saying here is, shouldn’t The PRESIDING OFFICER. Is there exceptions for real-life situations. We a person in bankruptcy court, already objection? Without objection, it is so are not giving consumers more tools to probably embarrassed by the process, ordered. decide what is a reasonable amount of already worried about paying the legal The amendment (No. 26), as modified, credit. All we are doing is saying, at bills, if they are below median income, was agreed to. the end of the day, the credit card com- shouldn’t we simplify the process for The PRESIDING OFFICER. The Sen- panies are going to get their bill and them? ator from Alabama.

VerDate Aug 04 2004 02:29 Mar 08, 2005 Jkt 039060 PO 00000 Frm 00032 Fmt 0624 Sfmt 0634 E:\CR\FM\G07MR6.056 S07PT1 March 7, 2005 CONGRESSIONAL RECORD — SENATE S2143 Mr. SESSIONS. Mr. President, I to Dorothy proposing marriage. Later, Corporal Eichelberger, a member of would just say Senator DURBIN is an after receiving her acceptance letter, the 1st Battalion of the 2nd Marine Di- excellent advocate, but this is the Frank ordered an engagement ring vision, was one of the thousands of val- fourth time that this bill in substan- from the catalog of a Chicago jeweler. iant young men and women who fought tially this form has been before this He sent payment to the jeweler via for the cause of liberty in Operation body. It has been marked up in the Ju- money order, with instructions for the Iraqi Freedom. Sadly, in March 2003, diciary Committee four times. We have ring to be mailed to Dorothy. When he while lying in a shallow foxhole in the had weeks on it each time it has come was able to take leave, Frank returned sand, a 67-ton Abrams tank rolled over up for debate here. After several weeks to Springfield and wed Dorothy on July him, crushing his pelvis and severely of debate, the last time it came up it 26, 1944. damaging his lower body. Corporal passed 83 to 15. Frank was honorably discharged Eichelberger, a native of Atchison, KS, The issues that he raises are really from the U.S. Navy in 1945, having been returned home to the United States for covered by the bill. If someone, anyone awarded the Asiatic-Pacific and Good rehabilitation and, in April 2003, was is disabled and they have a continuing Conduct Medals. Upon his return to ci- awarded a Purple Heart for his war in- extra medical expense, that would be vilian life, Frank began his 25-year ca- juries. considered in whether or not they reer as a salesman with several of Recently, the Marine Corps realized would ever have to pay any of their Springfield’s finest men’s clothiers, in- their terrible mistake. While this brave debts back. If their income is below cluding Robert’s Brothers, Arch Wil- young man’s wounds occurred in a median income, they would never be son’s, and Myers Brothers. combat zone, he was not injured by required to pay their debts back. All Frank again answered the call to hostile fire, a necessary qualification they would have to do is introduce serve his country when he joined the for the Purple Heart. For the sake of some evidence from their pay stubs or U.S. Naval Reserve in 1949. He was the award and all those who have been their income tax, what their income is. called to active duty during the Korean honored by it, the Marine Corps de- Certainly we have a right to ask that war in 1952, and he was stationed with cided to revoke Corporal Eichelberger’s before we discharge, wipe out, elimi- the Department of Defense in Arling- Purple Heart. GEN Michael W. Hagee, nate all debts, as people do when they ton, VA. In 1979, Frank retired from Commandant of the Marine Corps, has come into bankruptcy. the Naval Reserve, having served 30 appropriately personally offered his I really would just say that we have years and achieved the rank of chief apologies to Corporal Eichelberger. I, given great consideration to these petty officer yeoman. too, extend my sincere sympathies to issues. We could disagree, but these Frank demonstrated his commitment Corporal Eichelberger and his family amendments, for the most part, have to service not only through his career during this trying and confusing time. been up before. I do not believe that in the military, but also through his This error has caused significant em- most are going to be accepted. But many civic activities. He served the barrassment to my fellow Kansan, as there is every right of my colleague’s community of Springfield as an active well as to the Marine Corps, and we side to offer them. member of AFSCME, as a parishioner must take care that it is never re- f of Christ the King Catholic Church and peated. Blessed Sacrament Catholic Church, MORNING BUSINESS After speaking with Corporal and as a life member of the Knights of Eichelberger, I sense that his is a resil- Mr. SESSIONS. Mr. President, I ask Columbus. In addition, Frank Stead ient spirit—and no one can doubt his unanimous consent there now be a pe- served on the board of directors and courage. Corporal Eichelberger’s serv- riod of morning business, with Sen- was past president of Saint John’s Hos- ice and dedication will long be remem- ators permitted to speak for up to 10 pital Samaritans. He also served on the bered and honored. His unwavering minutes each. board of directors of the Illinois chap- commitment to our great Nation is a The PRESIDING OFFICER. Without ter of AARP. badge of honor he can proudly wear for objection, it is so ordered. In 1974, Frank Stead was appointed the rest of his life. f executive director of the Springfield I commend Corporal Eichelberger for Election Commission, serving in that TRIBUTE TO FRANCIS P. STEAD his distinguished service and sacrifice. post for 15 years before retiring in 1989. Mr. DURBIN. Mr. President, I rise Later, he would serve as a Democratic SECOND LT. RICHARD B. ‘‘BRIAN’’ GIENAU today to pay tribute to Francis P. Precinct Committeeman in Springfield. Mr. GRASSLEY. Mr. President, I rise ‘‘Frank’’ Stead, who passed away at I came to know Frank and his wife, today in tribute to a noble Iowan who the age of 90 on January 31, 2005, fol- Dorothy, well through their involve- has given his life for his country. 2LT lowing an extended illness. ment in Springfield politics. They vol- Richard ‘‘Brian’’ Gienau was killed on Frank Stead and I were neighbors in unteered countless hours for my cam- Sunday, February 27, in Ar Ramadi, Springfield, IL starting in 1969 when I paign when I was running for the House Iraq, when his military vehicle was returned home to Illinois after grad- of Representatives. struck by an explosive device. He was uating from Georgetown University Frank and Dorothy Stead shared 29 years old, a fellow alumnus of my Law School. He was a good neighbor, a nearly 60 years of marriage before alma mater, the University of North- good friend, and he will certainly be Dorothy passed away on February 4, ern Iowa, and a member of A Company, missed by the many people whose lives 2004. They are survived by their four 224th Engineer Battalion, Army Na- he touched. children: one son and three daughters, tional Guard, Burlington, IA. Frank was one of the many unsung along with seven grandchildren and Second Lieutenant Gienau is remem- heroes of an era that journalist Tom four great-grandchildren. bered as a hard-working family man Brokaw has dubbed ‘‘The Greatest Gen- I am honored to have had the oppor- with a history of military service. He eration.’’ Coming of age during the tunity to know this fine member of our joined the U.S. Navy in 1994 and en- Great Depression and serving our coun- Nation’s ‘‘Greatest Generation.’’ His listed in the Iowa Army National try during World War II, Frank shared military service, civic involvement, Guard in 1999. After graduating in 2003 in the values of a generation that commitment to his faith, and love of from University of Northern Iowa, he helped make our country what it is family have left an enduring impres- was commissioned in the Reserve Offi- today: a sense of honor and bravery, a sion on those of us who had the pleas- cers’ Training Corps as a second lieu- commitment to service, and above all, ure of knowing him. He will be missed. tenant. He was mobilized last October. a love of family and country. f Second Lieutenant Gienau is sur- In 1943, at the height of the U.S. ac- vived by his mother, Debbee Way, of tion in World War II, Frank enlisted in HONORING OUR ARMED FORCES Dunkerton, IA, and his father, Richard the U.S. Navy and was assigned to the CORPORAL TRAVIS EICHELBERGER Gienau, of Waterloo, IA. He also leaves Pacific theater, leaving behind his Mr. BROWNBACK. Mr. President, I behind a young son. My prayers go out sweetheart, Dorothy Mlaker. While on rise today to honor a truly heroic Kan- today to his family and friends in their duty in the Pacific, Frank sent a letter san, CPL Travis Eichelberger. time of loss. Let us today remember

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