[Congressional Record Volume 147, Number 24 (Tuesday, February 27, 2001)]
[Extensions of Remarks]
[Page E219]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        FEDERAL DEPOSIT INSURANCE ADJUSTMENT ACT--A DESCRIPTION

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                            HON. JOEL HEFLEY

                              of colorado

                    in the house of representatives

                       Tuesday, February 27, 2001

  Mr. HEFLEY. Mr. Speaker, The Federal Deposit Insurance Adjustment Act 
indexes deposit insurance coverage to inflation every three years, as 
well as retroactively indexing back to 1980, thus raising the deposit 
insurance ceiling to approximately $200,000.
  Since 1980, FDIC deposit insurance has lost almost half of its value 
on an inflation-indexed basis. Today, deposit insurance is less than it 
was in 1974 when FDIC coverage was doubled to $40,000.
  The Federal Deposit Insurance Adjustment Act provides depositors with 
increased security while strengthening the safety and soundness of the 
banking system. It will help local communities by enabling depositors 
to keep more of their money in local banks, where it can be reinvested 
for community projects and local lending. Lastly, it will help small 
depositors, especially those on fixed incomes and small businesses, who 
need liquidity, or who are not in a position to take advantage of our 
stock market or to bear the risks inherent in the stock market.

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