[Congressional Record Volume 147, Number 33 (Tuesday, March 13, 2001)]
[Senate]
[Pages S2172-S2180]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     BANKRUPTCY REFORM ACT OF 2001

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
resume consideration of S. 420. The clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 420) to amend title 11, United States Code, and 
     for other purposes.

  Pending:

       Schumer amendment No. 25, to ensure that the bankruptcy 
     code is not used to exacerbate the effects of certain illegal 
     predatory lending practices.
       Feinstein modified amendment No. 27, to place a $2,500 cap 
     on any credit card issued to a minor, unless the minor 
     submits an application with the signature of his parents or 
     guardian indicating joint liability for debt or the minor 
     submits financial information indicating an independent means 
     or an ability to repay the debt that the card accrues.
       Leahy amendment No. 20, to resolve an ambiguity relating to 
     the definition of current monthly income.
       Conrad modified amendment No. 29, to establish an off-
     budget lockbox to strengthen Social Security and Medicare.
       Sessions amendment No. 32, to establish a procedure to 
     safeguard the surpluses of the Social Security and Medicare 
     hospital insurance trust funds.
       Wellstone amendment No. 35, to clarify the duties of a 
     debtor who is the plan administrator of an employee benefit 
     plan.
       Wellstone amendment No. 36, to disallow certain claims and 
     prohibit coercive debt collection practices.
       Wellstone amendment No. 37, to provide that imports of 
     semifinished steel slabs shall be considered to be articles 
     like or directly competitive with taconite pellets for 
     purposes of determining the eligibility of certain workers 
     for trade adjustment assistance under the Trade Act of 1974.

[[Page S2173]]

       Kennedy amendment No. 38, to allow for reasonable medical 
     expenses.
       Kennedy amendment No. 39, to remove the dollar limitation 
     on retirement savings protected in bankruptcy.
       Collins amendment No. 16, to provide family fishermen with 
     the same kind of protections and terms as granted to family 
     farmers under chapter 12 of the bankruptcy laws.
       Leahy amendment No. 41, to protect the identify of minor 
     children in bankruptcy proceedings.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
South Carolina, Mr. Hollings, is recognized for not to exceed 20 
minutes to speak on the lockbox issue.
  Mr. HOLLINGS. Mr. President, I had a lockbox amendment at the desk, 
but I am not calling it up at this time. In the limited time granted 
me, I want to support the Conrad amendment, which will be introduced 
later, having to do with procedure. I didn't want to bring about any 
confusion because I think the Conrad amendment is a sound one. I know 
that the particular amendment I have at the desk was designed by the 
Administrator of Social Security. It is a true lockbox.
  But we have a more serious problem here. There isn't any question 
that with the Concord Coalition coming out yesterday afternoon with a 
joint statement by Warren Rudman, Sam Nunn, Peter Peterson, Robert 
Rubin, and Paul Volcker, we are just about ready to break the 
discipline with respect to paying down the debt. They strongly point 
out the reasons we should continue the discipline.
  I ask unanimous consent that their particular summary be printed in 
the Record at this point.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

              [From the Concord Coalition, Mar. 12, 2001]

  Joint Statement by Warren Rudman, Sam Nunn, Peter Peterson, Robert 
                         Rubin and Paul Volcker

       Washington.--Congress and the Bush administration face the 
     critical challenge this year of adopting a framework for 
     using near-term budget surpluses to help fill the huge long-
     term gaps in federal entitlement programs and household 
     savings, and to best further our continued economic well 
     being. This is certainly a more welcome challenge than 
     eliminating budget deficits, but it is every bit as vital.
       What are we concerned about?
       We are concerned that the mere prospect of very large, but 
     highly uncertain, budget surpluses is being used as an excuse 
     to abandon fiscal discipline, creating the threat of renewed 
     non-Social Security deficits and failing to realize the full 
     opportunity of paying down the publicly held debt.
       Then there is the fundamental long-term challenge, which 
     The Concord Coalition has always stressed, of setting aside 
     sufficient resources to meet the huge retirement and health 
     care costs associated with the coming ``senior boom.'' The 
     surpluses provide an opportunity to help meet this 
     challenge--but only if we are careful to preserve them.
       The obvious question: How much should we be willing to 
     gamble on 10-year projections that the Congressional Budget 
     Office itself say could be off by trillions of dollars?
       Answer: The Concord Coalition believes that it is unwise to 
     rely on these projections to commit ourselves to a series of 
     large escalating tax reductions over a 10-year period, 
     particularly in advance of addressing the huge and daunting 
     future deficits of Social Security and Medicare. Doing so 
     would be to rely on the unreliable while we ignore the 
     inevitable.
       We believe that fiscal discipline is the key to providing 
     for the unmet needs of the future.
       Savings from deficit reduction, and now surpluses, have 
     helped provide the capital to increase the productivity of 
     American workers--a major factor in the record growth of the 
     last 10 years. Further gains in productivity will become 
     especially urgent when the retirement of the huge baby boom 
     generation virtually halts the growth in the size of the U.S. 
     work force.
       Continued debt reduction is the government's most direct 
     contribution to net national savings. Increasing national and 
     personal savings is the single most effective policy the 
     government can pursue to promote long-term economic growth 
     and retirement security. Budget proposals should be assessed 
     in that context.
       As public debt is reduced to the low levels possible, other 
     policies such as retirement savings accounts also play an 
     important role. Household savings are nowhere near adequate 
     to prepare for ever-lengthening retirements.
       We recommend that as Congress and the Bush administration 
     decide how best to deploy budget surpluses, they be guided by 
     the following framework:
       Ensure the continued economic benefits of a stable fiscal 
     policy by maintaining discipline and avoiding both a spending 
     spree and large escalating tax cuts.
       It is exceedingly unwise to lock in a large 10-year tax cut 
     based on unreliable long-term budget projections.
       An immediate moderate tax cut is justified and reasonable 
     as a surplus dividend, given last year's surplus and in light 
     of near-term economic and budgetary prospects.
       However, a back loaded 10-year tax cut is not the right 
     tool to provide short-term economic stimulus--particularly at 
     the expense of the urgent long-term need to fund our senior 
     entitlements and retirement savings needs.
       Realize the full opportunity for paying down the public 
     debt to the low levels possible.
       Establish a new set of firm, but realistic discretionary 
     spending caps.
       Consider establishing a system of mandatory, individually 
     owned retirement accounts to help families build a more ample 
     nest egg while alleviating concerns that future budget 
     surpluses will result in either higher spending or in a large 
     build up of government-owned private sector financial assets.

  Mr. HOLLINGS. The only objection I have to it--and I commend them for 
their leadership--is they say an immediate moderate tax cut is 
justified. You see, therein is the difference with this particular 
Senator and the ``wag.'' Surpluses, surpluses, surpluses--everywhere 
men cry surpluses. But there is no surplus. Mind you me, I have been 
elected seven times to the Senate, and to paraphrase our wonderful 
leader, President Richard Nixon, I am not a nut. I believe in tax cuts, 
too--if you have some taxes to cut. So let's see where the taxes are to 
cut. They say the so-called surpluses belong to the people, but I find 
nothing but indebtedness belonging to the people.
  For example, we have gone, in the past 20 years, from a creditor 
nation to the largest debtor nation in history--some $2 trillion. We 
actually have a current account deficit of $439 billion, or more, and 
going up. There is a deficit in the balance of trade up, up, and away, 
where we used to have a plus balance of trade. With respect to 
surpluses, actually, we owe Social Security some $1.164 trillion 
Medicare accounts are $238 billion in the red. Military retirement is 
$156 billion in the red. Civilian retirement is $544 billion in the 
red. Unemployment compensation is $92 billion in the red.
  Mr. President, I ask unanimous consent that this table of 
Congressional Budget Office figures be printed in the Record at this 
particular point.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                  TRUST FUNDS LOOTED TO BALANCE BUDGET
                      [By fiscal year, in billions]
------------------------------------------------------------------------
                                                   2000    2001    2002
------------------------------------------------------------------------
Social Security.................................   1,007   1,164   1,336
Medicare
  HI............................................     169     198     234
  SMI...........................................      45      40      39
Military Retirement.............................     149     156     164
Civilian Retirement.............................     512     544     575
Unemployment....................................      86      92      98
Highway.........................................      31      31      30
Airport.........................................      13      15      17
Railroad Retirement.............................      25      26      27
Other...........................................      72      74      77
                                                 -----------------------
      Total.....................................   2,109   2,340   2,597
------------------------------------------------------------------------

  Mr. HOLLINGS. This shows the total sum of all trust funds--not just 
Social Security, but all the trust funds--including black lung, nuclear 
and otherwise. So the total amount that we now owe in Government 
accounts--since they want to split it--is $2.3 trillion.
  Let me go right to that particular point: $2.3 trillion, as compared 
to the $3.4 trillion they call public debt. You see, that is where Mr. 
Greenspan and others start the monkey business of dividing the debt 
that belongs to us all. We are the Government, and the public debt and 
the Government debt, or the intergovernmental accounts, are all our 
indebtedness. It is $5.7 trillion. Now that Government debt has not 
gone down. We ended the last fiscal year $23 billion in debt. The 
national debt went up some $23 billion.
  I ask unanimous consent to have printed in the Record page 20 of the 
Treasurer's report showing the difference in how it increased.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page S2174]]



  TABLE 6.--MEANS OF FINANCING THE DEFICIT OR DISPOSTION OF SURPLUS BY THE U.S. GOVERNMENT, SEPTEMBER 2000 and
                                                  OTHER PERIODS
                                            [In millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                  Net transactions (-) denotes net         Account balances curent fiscal year
                               reduction of either liability or asset  -----------------------------------------
   Assets and liabilities                     accounts                         Beginning of
 directly related to budget  ----------------------------------------------------------------------
     off-budget activity                        Fiscal year to date                                   Close of
                               This month  ----------------------------   This year    This month    this month
                                              This year    Prior year
----------------------------------------------------------------------------------------------------------------
     Liability accounts
 
Borrowing from the public:
 Public debt securities,
 issued under general
 Financing authorities:
    Obligations of the
     United States, issued
     by:
        United States               -3,644        17,908       130,078     5,641,271     5,662,822     5,659,178
         Treasury...........
        Federal Financing     ............  ............  ............        15,000        15,000        15,000
         Bank...............
                             -----------------------------------------------------------------------------------
          Total, public debt        -3,644        17,908       130,078     5,656,271     5,677,822     5,674,178
           securities.......
                             ===================================================================================
        Plus premium on                -26           697          -200         2,002         2,725         2,699
         public debt
         securities.........
        Less premium on               -832        -5,157         1,648        80,698        76,373        75,541
         public debt
         securities.........
                             ===================================================================================
          Total public debt         -2,839        23,761       128,230     5,577,575     5,604,175     5,601,336
           securities net of
           Premium and
           discount.........
                             ===================================================================================
Agegncy securities, issued              31          -832          -854        28,605        27,641        27,672
 under special financing
 authorities (see Schedule
 B, for other Agency
 Borrowing, see Schedule C)
                             ===================================================================================
      Total federal                 -2,808        22,929       127,376     5,606,080     5,631,817     5,629,009
       securities...........
                             -----------------------------------------------------------------------------------
    Deduct:.................
        Federal securities          29,557       246,453       221,530     1,989,308     2,206,204     2,235,761
         held as investments
         of government
         accounts (see
         Schedule D)........
        Less discount on                30           853         5,460        16,148        16,970        17,001
         federal securities
         held as investments
         of government
         accounts...........
                             -----------------------------------------------------------------------------------
        Net federal                 29,527       245,600       216,070     1,973,160     2,189,234     2,218,760
         securities held as
         investments of
         government accounts
                             ===================================================================================
          Total borrowing          -32,334      -222,671       -88,694     3,632,920     3,442,583     3,410,248
           from the public..
                             ===================================================================================
Accrued interest payable to         13,024         1,608        -2,845        42,603        31,187        44,211
 the public.................
Allocations of special                 -21          -440            80         6,799         6,380         6,359
 drawing rights.............
Deposit funds...............        -1,171    \1\ -1,151            97         3,997         4,017         2,846
Miscellaneous liability              5,329          -461           498         4,420        -1,370         3,959
 accounts (includes checks
 outstanding etc.)..........
                             -----------------------------------------------------------------------------------
      Total liability              -15,174      -223,116       -90,864     3,690,739     3,482,798     3,467,624
       accounts.............
                             ===================================================================================
   Asset accounts (deduct)
 
Cash and monetary assets:
    U.S. Treasury operating
     cash: \2\
        Federal Reserve              2,498         1,818         1,689         6,641         5,961         8,459
         accounts...........
        Tax and loan note           36,981        -5,618        15,891        49,817         7,218        44,199
         accounts...........
                             -----------------------------------------------------------------------------------
          Balance...........        39,479        -3,799        17,580        56,458        13,180        52,659
                             ===================================================================================
    Special drawing rights:
        Total holdings......           -34            33           178        10,284        10,350        10,316
        SDR certificates             1,000         4,000         2,000        -7,200        -4,200        -3,200
         issued to Federal
         Reserve Banks......
                             -----------------------------------------------------------------------------------
          Balance...........           966         4,033         2,178         3,084         6,150         7,116
                             ===================================================================================
    Reserve position on the
     U.S. quota in the IMF:
        U.S. subscription to
         International
         Monetary Fund:
            Direct quota      ............  ............        14,763        46,525        46,525        46,525
             payments.......
            Maintenance of            -257        -3,336           412         5,027         1,947         1,691
             value
             adjustments....
        Letter of credit               -43        -5,194       -15,750       -30,633       -35,784       -35,827
         issued to IMF......
        Dollar deposits with             2             4           -36          -121          -119          -117
         the IMF............
        Receivable/Payable (-          183         2,234          -562          -815         1,235         1,418
         ) for interim
         maintenance of
         value adjustments..
                             -----------------------------------------------------------------------------------
          Balance...........          -114        -6,292        -1,173        19,982        13,804        13,690
                             ===================================================================================
    Loans to International    ............  ............  ............  ............  ............  ............
     Monetary Fund..........
    Other cash and monetary            927           908           386        23,983        23,964        24,891
     assets.................
                             ===================================================================================
      Total cash and                41,258        -5,151        18,476       103,507        57,098        98,356
       monetary assets......
                             ===================================================================================
Net Activity, Guaranteed            -2,472        -4,327        -4,156       -18,518       -20,373       -22,845
 Loan Financing.............
Net Activity, Direct Loan            9,727        21,744        18,605        83,894        95,911       105,638
 Financing..................
Miscellaneous asset accounts         2,181        -1,602         1,579         1,496        -2,288          -106
                             ===================================================================================
      Total asset accounts..        50,694        10,664        34,505       170,378       130,348       181,043
                             ===================================================================================
Excess of liabilities (+) or       -65,868      -233,780      -125,369    +3,520,361    +3,352,449    +3,286,581
 assets (-).................
                             ===================================================================================
Transactions not applied to             46        -3,213         1,009  ............        -3,258        -3,213
 current year's surplus or
 deficit (see Schedule a for
 Details)...................
                             ===================================================================================
Total budget and off-budget        -65,822      -236,993      -124,360    +3,520,361    +3,349,191    +3,283,369
 federal entities (financing
 of deficit (+) or
 disposition of surplus (-))
----------------------------------------------------------------------------------------------------------------
\1\ Outlays for the Department of the Interior have been decreased in October 1999 by $329 million; to reflect
  the reclassification of the ``Tribal Trust funds'', Office of the Special Trustee for the American Indians;
  from a trust fund to a deposit fund.
\2\ Major sources of information used to determine Treasury's operating cash income include Federal Reserve
  Banks, the Treasury Regional Finance Centers, the Internal Revenue Service Centers, the Bureau of the Public
  Debt and various electronic systems. Deposits are reflected as received and withdraws are reflected as
  processed.
. . . No Transactions.
(**) Less than $500,000.
 
Note.--Details may not add to totals due to rounding.

  Mr. HOLLINGS. Mr. President, we not only ended the fiscal year with a 
$23 billion deficit, but look at the debt to the penny, which I printed 
just a half hour ago from the U.S. Treasury Web site, and you will see 
that we continue to run deficits. U.S. Treasury Secretary O'Neill, when 
I had him at the hearing, said, ``That is your paper, Senator.'' I 
said, ``No, this is your paper, Secretary O'Neill.'' The public debt 
numbers found on-line show that the debt has increased from $5.674 
trillion at the end of September last year--at the beginning of this 
fiscal year, 2001--to $5.747 trillion. So the debt has gone up $73 
billion.
  Let me emphasize the split in the debt. The Treasury Secretary says 
who owes the public debt. He has the public debt held by the public, 
and he has another listing of intergovernmental holdings. In January, 
for the years preceding--Mr. President, that used to be Government 
debt. Now they are trying to change the phraseology so you are misled--
intergovernmental holdings. That is an indebtedness. The public debt 
has gone up $21 billion. Did you hear that? Mr. Greenspan, Chairman of 
the Federal Reserve, is running around saying, ``My problem is we are 
going to pay down too much debt,'' when it has gone up in the beginning 
of the fiscal year some $21 billion. It is $3.4 trillion, going down 
$21 billion. Go down $100 billion, go down $200 billion, go down $300 
billion, $400 billion, and you still

[[Page S2175]]

have $3 trillion to pay off. Don't worry about paying down too much 
debt.
  It was an absolute charade to see the Chairman of the Federal Reserve 
come to the Congress with that nonsense about ``we have too much debt 
to pay down.'' I mean, we are paying down too much debt and we are 
going to have to pay a penalty on our fiscal holdings.
  With respect to the intergovernmental holdings, or public debt, it is 
$52 billion. So as of this morning, a half hour ago, the Secretary of 
the Treasury reports that the debt has gone up $73 billion. It is not 
going down. That is the problem with the Concord Coalition.
  I ask unanimous consent that these documents be printed in the Record 
at this point.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                          THE DEBT TO THE PENNY
                        [Updated March 12, 2001]
------------------------------------------------------------------------
                                                         Amount
------------------------------------------------------------------------
Current: 03/09/2001...........................     $5,747,792,825,182.88
Current month:
  03/08/2001..................................      5,747,550,277,632.42
  03/07/2001..................................      5,747,491,094,329.69
  03/06/2001..................................      5,749,734,337,611.83
  03/05/2001..................................      5,743,401,716,650.84
  03/02/2001..................................      5,742,769,797,856.70
  03/01/2001..................................      5,726,774,439,028.95
Prior months:
  02/28/2001..................................      5,735,859,380,573.98
  01/31/2001..................................      5,716,070,587,057.36
  12/29/2000..................................      5,662,216,013,697.37
  11/30/2000..................................      5,709,699,281,427.00
  10/31/2000..................................      5,657,327,531,667.14
Prior fiscal years:
  09/29/2000..................................      5,674,178,209,886.86
  09/30/1999..................................      5,656,270,901,615.43
  09/30/1998..................................      5,526,193,008,897.62
  09/30/1997..................................      5,413,146,011,397.34
  09/30/1996..................................      5,224,810,939,135.73
  09/29/1995..................................      4,973,982,900,709.39
  09/30/1994..................................      4,692,749,910,013.32
  09/30/1993..................................      4,411,488,883,139.38
  09/30/1992..................................      4,064,620,655,521.66
  09/30/1991..................................      3,655,303,351,697.03
  09/28/1990..................................      3,233,313,451,777.25
  09/29/1989..................................      2,857,430,960,187.32
  09/30/1988..................................      2,602,337,712,041.16
  09/30/1987..................................      2,350,276,890,953.00
------------------------------------------------------------------------
Source: Bureau of the Public Debt.


                                                                   WHO HOLDS THE DEBT?
                [Beginning 1/31/2001 (debt held by the public vs. intragovernmental holdings) historical debt prior to January 31, 2001]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Debt held by the public           Intragovernmental holdings                     Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current:
    03/09/2001..............................               $3,426,528,227,885.96               $2,321,264,597,296.92               $5,747,792,825,182.88
Prior months:
    02/28/2001..............................                3,401,737,625,377.06                2,334,121,755,196.92                5,735,859,380,573.98
    01/31/2001..............................                3,388,015,685,287.98                2,328,054,901,769.38                5,716,070,587,058.36
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                                                   WHO HOLDS THE DEBT?
                [Thru 1/30/2001 (debt held by the public vs. intragovernmental holdings) historical debt beginning with January 31, 2001]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Debt held by the public           Intragovernmental holdings                     Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
Prior months:
    01/30/2001..............................                3,369,903,111,703.32                2,370,388,014,843.13                5,740,291,126,546.45
    12/29/2000..............................                3,380,398,279,538.38                2,281,817,734,158.99                5,662,216,013,697.37
    11/30/2000..............................                3,417,401,544,006.82                2,292,297,737,420.18                5,709,699,281,427.00
    10/31/2000..............................                3,374,976,727,197.79                2,282,350,804,469.35                5,657,327,531,667.14
Prior fiscal years:
    09/29/2000..............................                3,405,303,490,221.20                2,268,874,719,665.66                5,674,178,209,886.86
    09/30/1999..............................                3,636,104,594,501.81                2,020,166,307,131.62                5,656,270,901,633.43
    09/30/1998..............................                3,733,864,472,163.53                1,792,328,536,734.09                5,526,193,008,897.62
    09/30/1997..............................                3,789,667,546,849.60                1,623,478,464,547.74                5,413,146,011,397.34
--------------------------------------------------------------------------------------------------------------------------------------------------------

  Mr. HOLLINGS. Mr. President, what is happening? Well, we got on 
course. Reaganomics II. We know what Reaganomics I did. I notice my 
friend, the distinguished Senator from Pennsylvania, Mr. Specter, 
called it in the interviews over the weekend Kemp-Roth. He didn't want 
to hurt President Reagan's feelings. I don't either, but President 
Reagan adopted this idea of ``starve the beast.'' All we have to do is 
cut the revenues. The money belongs to the people, and the people know 
how best to spend their money, and we will have prosperity galore.
  What happened? Well, President Lyndon Johnson last balanced the 
budget. During 200 years of history, in the course of all the wars, we 
had accumulated less than a trillion dollars in debt.
  But when President Reagan came in with Reaganomics, that less than a 
trillion dollars in debt went up to $4 trillion and is now up to $5.7 
trillion. What happens? I speak now to my colleagues because this is 
the greatest waste. I served on the Grace Commission to abolish waste, 
fraud, and abuse. The greatest waste ever proposed or propounded in the 
history of Government is the interest costs, the carrying charges on 
the national debt.
  When President Johnson balanced the budget and for the 200 years of 
history, the interest cost on the debt was only $16 billion. Now it has 
gone up to $365 billion and is projected by CBO to go to $371 billion. 
The first thing the Government did this morning at 8 o'clock was go 
down to the bank, borrow $1 billion and add it to the debt. Tomorrow we 
are going to do the same thing. On Saturday do you think the banks are 
closed? No. We are going to borrow another $1 billion on Saturday, and 
on Sunday and on Christmas Day. Each and every day, we are going to 
borrow $1 billion for nothing--$365 billion.
  The distinguished Presiding Officer could buy all sorts of things 
with this money. We could get an energy policy, a forestry policy, a 
research policy. We could pay for education. We could almost double 
everything that anybody wanted. This $365 billion amount is bigger than 
the national defense. National defense is supposed to go from $305 
billion to $310 billion. We are paying out more just in carrying 
charges, waste, and nobody seems to care.
  The point is, when you are in a deficit and debt position, you cannot 
cut taxes without increasing taxes. That is exactly where we are. The 
so-called tax cut that President Bush is insisting upon is a tax cut 
that wore no clothes.
  He is running all around the country. Talk of a tax cut started back 
in September and October, when he was ascending in the polls. Then the 
market started to decline. In November, the distinguished Mr. Cheney 
said it looked like a recession. They insisted on the tax cut in 
December, January, and February. Can you imagine the President having 
to go out and sell a tax cut?
  People ought to sober up on that particular point. Do you have to 
sell a tax cut? What is the market saying? The market is saying: Look, 
with all this indebtedness, awash in debt, a devalued dollar, they are 
not going to, by gosh, buy our instruments, our bonds, they are not 
going to continue to finance our debt, and they are going to have to 
raise the interest rates. That is exactly what happened in Reaganomics 
I, and we have Reaganomics II on course. There is no education in the 
second kick of a mule. We should all like the Concord Coalition: Pay 
down the debt; enforce the discipline; quit running around bribing, if 
you please, the people with their own money.
  It is a sordid trick. We ought to be ashamed of ourselves. 
Responsible Congressmen and Senators ought to tell the truth. We have 
gone bilingual when it comes to the budget. The second language is 
truth. We are running around here saying surplus, surplus, surplus 
everywhere, and there is no surplus. Even the President says there is 
no surplus.
  I hold in my hand President Bush's document that he just submitted. 
On page 201, you can see the debt this year: $5.637 trillion. He 
projects that the national debt will go to $7.159 trillion--not a 
surplus. This is President Bush. Why don't they ask him: Mr.

[[Page S2176]]

President, you say ``surplus,'' but your own budget shows the debt 
increasing.
  I ask unanimous consent to print in the Record page 201.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                   TABLE S-16.--FEDERAL GOVERNMENT FINANCING AND DEBT
                                                                [In billions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                              Estimate
                                   Actual  -------------------------------------------------------------------------------------------------------------
                                    2000      2001      2002      2003      2004      2005      2006      2007      2008      2009      2010      2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
Financing:
    Unified budget surplus......       236       281       231       246       268       273       307       341       372       412       459       524
        On-budget surplus/              86       124        60        53        57        36        55        71        84       109       136       181
         reserve for
         contingencies..........
        Off-budget surplus......       150       157       171       193       211       237       252       270       287       303       323       343
    Means of financing other
     than borrowing from the
     public:
        Premiums paid (-) on            -6       -10  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
         buybacks of Treasury
         securities.............
        Changes in:
            Treasury operating           4         3  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
             cash balance.......
            Checks outstanding,          3        -*        -1  ........  ........  ........  ........  ........  ........  ........  ........  ........
             deposit funds, etc.
        Seigniorage on coins....         2         2         2         2         2         2         2         2         2         2         2         2
        Less: Net financing
         disbursements:
            Direct loan                -22       -39        -4       -17       -18       -17       -16       -16       -16       -16       -16       -15
             financing accounts.
            Guaranteed loan              4        -1        -1         1        --        --         1         1         1         1         1         1
             financing accounts.
                                 -----------------------------------------------------------------------------------------------------------------------
              Total; means of          -13       -45        -4       -15       -16       -15       -14       -13       -13       -13       -13       -13
               financing other
               than borrowing
               from the public..
                                 -----------------------------------------------------------------------------------------------------------------------
              Total, amount            223       236       227       232       252       257       294       328       359       399       446       511
               available to
               repay debt held
               by the public....
    Change in debt held by the
     public:
        Change in debt held by        -223      -236      -227      -232      -252      -257      -294      -328      -181      -125       -71       -50
         the public (gross).....
        Less change in excess     ........  ........  ........  ........  ........  ........  ........  ........      -178      -274      -375      -461
         balances...............
            Change in debt held       -223      -236      -227      -232      -252      -257      -294      -328      -359      -399      -446      -511
             by the public (net)
Debt Subject to Statutory
 Limitation, End of Year:
    Debt issued by Treasury.....     5,601     5,610     5,640     5,697     5,752     5,822     5,878     5,918     6,120     6,396     6,750     7,139
    Adjustment for Treasury debt       -15       -15       -15       -15       -15       -15       -15       -15       -15       -15       -15       -15
     not subject to limitation
     and agency debt subject to
     limitation.................
    Adjustment for discount and          6         6         6         6         6         6         6         6         6         6         6         6
     premium....................
                                 -----------------------------------------------------------------------------------------------------------------------
      Total, debt subject to         5,592     5,600     5,630     5,687     5,743     5,813     5,868     5,908     6,110     6,386     6,740     7,129
       statutory limitation.....
Debt Outstanding, End of Year:
    Gross Federal Debt:
        Debt issued by Treasury.     5,601     5,610     5,640     5,697     5,752     5,822     5,878     5,918     6,120     6,396     6,750     7,139
        Debt issued by other            28        27        27        26        25        24        23        21        21        21        20        20
         agencies...............
                                 -----------------------------------------------------------------------------------------------------------------------
          Total, gross Federal       5,629     5,637     5,666     5,723     5,777     5,846     5,901     5,939     6,141     6,417     6,770     7,159
           debt.................
Held by:
    Debt securities held as          2,219     2,463     2,719     3,007     3,314     3,640     3,988     4,355     4,737     5,138     5,562     6,001
     assets by Government
     accounts...................
    Debt Securities held as
     assetes by the public:
        Debt held by the public      3,410     3,174     2,947     2,715     2,463     2,206     1,912     1,585     1,404     1,279     1,208     1,158
         (gross)................
        Less excess balances....  ........  ........  ........  ........  ........  ........  ........  ........      -178      -452      -827    -1,288
            Debt held by the         3,410     3,174     2,947     2,715     2,463     2,206     1,912     1,585     1,226       827       381      -130
             public (net).......
--------------------------------------------------------------------------------------------------------------------------------------------------------

  Mr. HOLLINGS. Mr. President, there it is. We have been engaged in the 
most sordid activity one can possibly imagine with these 10-year 
budgets. I remember when I was chairman of the Budget Committee in 1979 
and 1980, we had a 1-year budget. The country sustained, survived, 
succeeded 200 years of history on 1-year budgets. If you were a 
Governor of a State and you submitted a 10-year budget, Moody's and 
Standard & Poor's would immediately lift your credit rating. But wait a 
minute, the best campaign finance trick is to use the Government's 
budget to get ourselves reelected, running around and promising visions 
of sugarplums dancing in their heads: Give the money back; the people 
know how to spend their money.
  Of course, every morning we are borrowing $1 billion, and they say 
give it back to the people, but we are increasing the debt and 
increasing the waste. We run amok with these 10-year budgets, and we 
ought to go back to 1-year budgets. Let's take the budget we passed in 
December, a few months ago, and debate all the cuts and vote on them.
  With respect to the increase, we should have the pay-go rule. You 
have to have an offset and withhold, not abolish. If President Bush and 
this Government has a surplus by the end of this fiscal year, I will 
vote for President George W. Bush's tax cut. I will vote for it--I have 
to say that publicly--if we have a surplus. But as long as we continue 
to increase the debt, let's hold up and find out.
  As much as I hate to, I think we might have to go with a capital 
gains tax cut, instead of an across-the-board tax cut, to really get 
the market going. An across-the-board cut is not going to infuse 
consumer confidence.
  If the President came back here today--that is our problem. These 
Presidents continue to run for office, they continue to work at keeping 
the job rather than doing the job. If he would only come back and tend 
to the real problems of the country and quit running all over the place 
trying to sell a tax cut, I think the market would start back up. It is 
not lack of consumer confidence in the economy, it is citizens' lack of 
confidence in their Government. When they see us play this sordid game 
of 10-year budgets, calling deficits and debt surpluses and sending the 
money back with a childish cause that people are going out and spending 
their money best and that kind of nonsense, that is what is happening 
to the stock market. They can see we are going to an inflated economy, 
the results we had from Reaganomics I. We are going to have Reaganomics 
II, and we are going to really be in economic trouble.
  The ox is in the ditch. We have everyone running around talking about 
surpluses and 10-year budgets where everybody is right and everybody is 
wrong. If we can just hold the line and get back to that 8-year record 
of paying down the debt and fiscal discipline, then the people will 
begin to appreciate this Congress at the market level.
  Right now, we ought to be ashamed of ourselves with this sordid game 
of again and again calling deficits and debt surpluses in order to buy 
the people's vote. That is all we are doing. We will, with April 15, 
have a large influx of revenues, and some debt will be paid down, but 
they will never get to paying down $3.4 trillion in the Presiding 
Officer's time and in my time.
  Do not worry about paying down the public debt. Let us worry about 
the increase of the overall national debt and go back to the Concord 
Coalition's recommendation of fiscal discipline.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. SESSIONS. Mr. President, I ask unanimous consent the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Crapo). Without objection, it is so 
ordered.
  Mr. SESSIONS. Mr. President, we are now proceeding on our debate and 
discussion on the bankruptcy bill that is pending. I do hope those who 
have amendments and want to make statements on them will come down and 
take advantage of this time. It is an opportunity to discuss the 
important questions that are before us.
  As I have noted before, bankruptcy reform is, in fact, a second look 
at the 1978 bankruptcy law. That law reformed the way bankruptcy courts 
deal with debt in America. We have had experience now for over 20 years 
with

[[Page S2177]]

that reform. We have seen how the law has been manipulated and abused, 
and it is perfectly appropriate for us to try to create a system that 
is honest and fair, eliminates abuses, and helps us make sure that what 
happens in bankruptcy court is rational and defensible and furthers 
good public policy.
  That is what we are about. It is not legislation to fix all problems 
dealing with credit in America. It is what happens when a person files 
in bankruptcy. As the Members of this body know, we have in this 
legislation a provision that says if you make above median income in 
America, and a judge finds you are capable of paying back as much as 25 
percent of your debts, and he calculates the current income and what 
your debts are, if he determines that is possible, instead of wiping 
out all your debt, you may be moved from chapter 7--in which debt is 
wiped out in bankruptcy--to chapter 13, in which you would pay back, 
over a number of years, 25 percent of the debts you owe.
  It is my view, and I think the view of a majority of Americans, that 
bankruptcy is a good thing. But if you can pay back your debts, you 
ought to pay them; that we ought not say a person with a $100,000 
income, perfectly capable of paying back a substantial portion of his 
debts, can just not pay them. In fact, some of these people, over a 
period of 3 to 5 years, can pay back all of their debts, we have 
learned.
  That is the change. I think well over half of the people who file 
bankruptcy, maybe three-fourths, maybe even more, will be below median 
income, so they will not be affected by this means testing of 
bankruptcy. It is just those above median income based on family size 
and other criteria.
  I believe we are doing the right thing. I believe it is the right 
approach, it is fair and just, and we ought to move in that direction.
  We have also improved the system by eliminating quite a number of 
abuses by good lawyers. Some people put them down, but I cannot blame a 
lawyer for advising his client there is an opportunity to not pay 
something if they do not have to under the current bankruptcy law. They 
have learned how to advise clients to take advantage of the current 
law. It is up to us now to fix that.
  One of the aspects in the bill that I think is of great value is an 
amendment I offered to encourage credit counseling. A lot of people do 
not understand credit counseling. I, frankly, did not fully understand 
it until I spent virtually a day with a good credit counseling agency 
in Mobile, AL. They are off the main thoroughfare. They had a nice 
area. People came there to deal with their debts.
  What they do is negotiate with the creditors of the people who come 
in to see them for counseling, and they will get them to reduce their 
interest rates, get them to stretch out their payments, and they will 
help that family develop a budget by which they can pay off their 
existing debts.

  Not only do they get them on a budget, but they save marriages. That 
is because one of the highest causes of marital breakup is financial 
discord. They sit the whole family down--children, wife, husband--and 
go over their income. They go over their expenditures, what they can 
reduce in their budget expenditures: Do they really need this cell 
phone? Do they really need the higher level cable TV? They knock it 
down.
  Then they get the creditors to see this family is in trouble. If you 
reduce your interest rate so that payment to the credit card company is 
reduced, the payment to the furniture store is reduced, the payment to 
the brother-in-law is reduced, maybe the deficiency on rent is 
reduced--they work out a budget so the family can work themselves out 
of this.
  The beauty of this is that for the first time, many of these families 
learn how to manage money. Too often they have not been taught that in 
America today. I think it is a very good thing. I believe that is 
healthy. Some have complained that our amendment says before you go to 
bankruptcy, you should go to a credit counseling agency and at least 
discuss with them the possibility that you could work out a debt 
repayment plan and come out better doing it that way rather than going 
straight into bankruptcy without that option.
  What is happening is there are lawyer mills in the country. You turn 
on your television; you look at your little flier at the corner market 
that shows what you buy and sell, automobiles, furniture and things, 
and you see advertisements by these lawyers about how to wipe out your 
debts and avoid paying what you owe.
  People respond. When they go down to the lawyer's office, essentially 
the lawyer tells them--there is no mystery about this; I don't think I 
am misstating it--I believe you are entitled to bankruptcy. I believe 
you can wipe out these debts. It is now January 1, so you will need to 
pay me $1,000. What I want you to do is live off your credit card and 
all, but do not pay any of your other debts. Save up until you get the 
$1,000 and pay me, and I will file the bankruptcy. Then you can wipe 
out all your debts.
  That is what they do, and they make money off that. I know an 
instance where one of these lawyers does at least 1,000 of those cases 
a year. That is $1 million in income in chapter 7, chapter 13, routine 
filings. He doesn't even meet his clients. Basically his paralegals do 
that and pretty much that is what goes on in America.
  For people who need that, that is fine. For people who are not able, 
hopelessly in debt for various reasons, that is fine. But if they can 
pay their way out of it, I think somebody ought to be concerned about 
helping them figure a way to do so. They will feel better about paying 
their debt.
  We don't need a legal system in America that suggests paying your 
debt isn't important. What does that do for us on a moral basis--that 
we have a legal bankruptcy system that suggests you have no 
responsibility to pay your debt if you can pay those debts? I don't 
think that is good public policy.
  I suggest at least there be an opportunity for every bankrupt to 
consider credit counseling. They are in virtually every community in 
America. If they are not there, the bankruptcy judge can certify that 
and the person doesn't have to go to credit counseling. But if there is 
a credit counselling agency, this bill would say to a bankrupt who is 
thinking about bankruptcy to go to them and talk to them. It is 
fundamentally an interview. They do not have to fill out forms or do 
anything at the credit counseling agency. They just have to certify 
that they have been there and they have considered that option because 
it is not being provided to them in the lawyer's office. Trust me. I 
believe for a certain number they are going to conclude that credit 
counseling--a matter they have never considered before--is better for 
them than going into bankruptcy. And the family will be better for it, 
and the legal system will be better for it.
  That is what we are about today. Many people are in debt for many 
different reasons. Some say: Well, it is credit card debt.
  Some college students are filing, but their numbers are not 
exceedingly high. The reason college students primarily are filing 
bankruptcy and the reason many of them are deeply in debt is paying for 
their tuition and fees--not on their credit card. It is their loan 
payment which has put them in debt very deeply. And at some point they 
end up running up credit card bills too, perhaps. But the biggest 
amount of debt for college students is a student loan and the money on 
which they have to borrow to live. Whatever the reason, we are not 
certain.
  We know hospital bills are a big factor in tipping people into 
bankruptcy. That is a legitimate reason. We know many people are in 
bankruptcy because they have a compulsion to spend; one or more family 
members just cannot discipline themselves. I do not know if it is an 
illness or what it is, but they cannot discipline themselves and are 
unable to work their way out of adverse financial circumstances as 
other family members are able to do. Other family members every day in 
America are sitting down and deciding when they can buy a new suit of 
clothes, or whether or not they can take a vacation this year, or 
whether or not they can go on a school trip, or buy a new car. What are 
they asking themselves? How can we pay the money we owe and buy 
something new? Maybe we can't afford to do both this year. Maybe we 
need to pay down our debt.
  We don't want to create a system that makes the honest, disciplined, 
frugal family look like a chump or look

[[Page S2178]]

like they are silly by working hard to pay off unexpected debt and 
rewarding those who do not make the effort.
  This is a fundamental question to me. This bill provides all the 
protections for median income and below that are in the previous 
legislation, and it provides other benefits also. It places women and 
children at the highest possible level of protection. They get the 
first money out of a bankruptcy estate today under the new legislation 
instead of being seventh or eighth under the current bill in who gets 
paid from what is left in the bankruptcy.

  It provides priority to pay alimony and child support in a way that 
we have never done before. It provides many other good provisions that 
help our country socially and economically do the right thing.
  We are excited about that possibility. Just because you move from 
chapter 7 to chapter 13, if you are above median income--in fact, it 
isn't all bad that you have been damaged dramatically.
  I saw an article recently where someone was talking to a bankruptcy 
lawyer. He said one person he was talking to had a $70,000-a-year 
income and wanted to rush out and file his bankruptcy bill under 
current law because under the new law he might have to go into chapter 
13 and pay back some of his debts.
  I ask you why a person who makes $70,000 a year shouldn't pay back 
some of his debt. They say: Well, it is medical bills. Maybe it is an 
unexpected medical bill. If he is making $70,000, why didn't he have 
insurance? If he is making below median income, or a low income, maybe 
I could be sympathetic because they didn't take out insurance. But if 
he is making $70,000, he ought to be able to provide some medical 
insurance. Maybe he shouldn't have such medical debts, No. 1. But, No. 
2, why should we take the view that if you are able to pay back to your 
hospital some of the costs of the service that hospital provided you, 
why shouldn't you pay them?
  I visited 20 hospitals in Alabama this year. I have talked to 
administrators, nurses, and doctors. They are in trouble. It is 
difficult for hospitals to make a living. They have a factor of 
uncollected debt. They do not abuse people. But they are not being paid 
a lot.
  If a person cannot pay the hospital, and they are making below median 
income in America, I don't want them to have to worry about it. Wipe 
out the debt and go forward under this bill. But if they are making 
above median income and they owe the hospital $10,000 and over 5 years 
they can pay them $2,500, why shouldn't they? They got a benefit from 
the hospital. Somebody else is going to pay for it, if they don't. Who 
else is going to pay it? People are going to be paying for it through 
their taxes and other payments, and they will be making below median 
income. Why should a person who is honest and frugal making below 
median income pay for the hospital bill for somebody making $70,000 who 
can pay a portion of his hospital bill? Answer that. That is not 
justice.
  We have a bill that takes a step toward achieving justice. They say: 
Well, you are just out defending big corporations, banks, and these 
collection agencies, and you are oppressing the poor. There is no 
change for the poor. There is no change in this bill for the 75 or 80 
percent of the people who file bankruptcy who already make below median 
income. There is no change in that. It is only if you make above median 
income that a judge can order you to pay some of your debt.
  I think that is right. I don't apologize for that. I do not believe 
in this class warfare argument we are hearing time and time again that 
it is oppression of the poor. Those are the same arguments we have 
heard today. It seems that the hospital providing good care to an 
individual and does not get paid for it is oppressing the person who is 
making above median income by asking them to pay for it; if a credit 
card company has loaned money, or a bank has loaned money to somebody 
to go out and buy a house, buy a car, buy things a family needs, they 
are oppressing them by giving them the money and asking them to pay it 
back when the time comes to pay your debts back. Most Americans pay 
their debts. I think credit cards are great.

  We have had serious complaints in this body--and rightly so--that 
banks and credit companies are not fairly making credit available to 
poor people.
  We have a bill called redlining that prohibits banks from opposing 
and refusing to allow people with marginal incomes to borrow money 
because they might think it is risky.
  The PRESIDING OFFICER. The Senator's time has expired. Under the 
previous order, 5 minutes was reserved for Senator Feinstein to begin 
at 11 o'clock.
  Mr. SESSIONS. I see Senator Feinstein is here. I will be glad to 
conclude.
  Fundamentally, this bill is not unfair. I would be willing to look at 
any particular part of it. It has been pounded on for 4 years now. 
Every jot and tittle of it has been looked at. We have tried to make 
sure it is fair in every way. But we do say you ought to seek credit 
counseling. Maybe there is an alternative to bankruptcy.

  We say, if you make above the median income, you can pay back some of 
your debts. But if your debts are so big, even if you make above median 
income, you do not have to pay them; you can wipe them out, and that is 
OK. And remember the great protection of bankruptcy for people in debt 
is they cannot be subject to harassing phone calls and letters, demands 
for payment and lawsuits.
  When you file bankruptcy, all lawsuits and demands for payment have 
to stop, whether you are in chapter 7 or chapter 13. A family can put 
their lives in order under the bankruptcy laws now and in this new bill 
in the same way that will allow them to have some stability in their 
lives, to bring a conclusion to their credit difficulties, to not be 
fighting lawsuits and credit demands that disrupt their lives.
  I thank the Chair and yield the floor.
  Mrs. FEINSTEIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from California.


                     Amendment No. 27, As Modified

  Mrs. FEINSTEIN. Mr. President, the amendment on the bankruptcy bill 
that I have proposed is a very straightforward amendment. It simply 
says credit card companies that issue credit cards to minors must limit 
that debt to $2,500 a credit card, unless the minor demonstrates the 
means to pay back the debt, or a parent cosigns for the debt.
  In addition, the amendment would entitle parents who cosign on their 
child's credit card the opportunity to be consulted before the debt 
limit on the card is increased.
  The amendment is basically a compromise. I amended the amendment to 
place a cap of $2,500 a card rather than $2,500 on all cards a minor 
might have.
  The reason for the amendment is a simple one. Student credit card 
debt has increased 46 percent over the last 2 years alone. Bankruptcy 
filings among youth have increased sevenfold since 1996. The problem 
is, there is no limit on the credit card debt a youngster can 
accumulate. This amendment would end that problem, give parents the 
responsibility of choosing to cosign for their youngster if they want 
more than a $2,500 cap, unless the youngster could demonstrate that 
they had the source of income to support the debt.
  So essentially what this amendment does is provide a credit card 
limit of debt of $2,500 a card for a youngster who is under the age of 
21.
  I thank the Chair and yield the floor.
  The PRESIDING OFFICER. Who yields time in opposition?
  If no one yields time, time will be charged equally to each side.
  Approximately 2 minutes remain in opposition to the Feinstein 
amendment.


                            Amendment No. 39

  Mr. SESSIONS. I will confine my remarks to the other amendment we 
will be voting on, unless someone else wants to respond to the 
Feinstein amendment.
  At 11 o'clock, we will also be voting on the Kennedy amendment that 
attempts to remove the cap of $1 million on how much a bankrupt can 
protect in their IRA account.
  I know Senator Kennedy steadfastly opposed the homestead law under 
the current bill and I agreed. We made substantial progress in 
containing the abuse of homestead that is unlimited in a few States. 
Right now, if you pour millions of dollars into a home, you can protect 
that home, you can file bankruptcy, and not pay your debtors, and keep 
the $2 million home. To me,

[[Page S2179]]

that is not right, so I have supported that change. And we could not 
get as far as we wanted because a number of States have provisions in 
their constitutions that protect homesteads. We made a number of steps 
to curtail that abuse--real steps--but we did not go as far as I wished 
we could have gone.
  This is a very similar situation. Why should you not pay individual 
debtors--why should you not pay your hospital debt and other debts and 
be able to file bankruptcy and have $2 million in your IRA account? 
Can't a person live on $1 million at a 6-percent return a year? That is 
$60,000 a year the rest of your life without touching the principal.
  So I think this is an abuse by rich people, really, to protect over 
$1 million in savings.
  The PRESIDING OFFICER. All time has expired on the Feinstein 
amendment.
  Does the Senator wish to continue under the 2\1/2\ minutes in 
opposition to the----
  Mr. SESSIONS. I think Senator Kennedy is here. He would wish to speak 
on his amendment.
  I yield the floor.
  Mr. KENNEDY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, for the first time in the history of 
bankruptcy, we will put at risk the retirement savings of workers. In 
this instance, we do not have a limitation in terms of the retirement 
savings under the 401(k) programs. There are virtually no limitations. 
But there are limitations in terms of the IRAs.
  The IRAs are the programs that are most used by working families. 
They can only contribute $2,000 a year to an IRA. There was no history 
and no comments in the long testimony we took before the Judiciary 
Committee that this was being abused, that people were putting money 
into their IRAs in order to be able to circumvent bankruptcy. They 
cannot do it in the first place because they can only contribute $2,000 
a year. But there are many hundreds of thousands of workers in this 
country who are putting aside the $2,000 a year and hope to build up a 
sufficient nest egg that will augment their Social Security so they 
will be able to live with some dignity. Now we are putting that money 
at risk.
  In many instances, the people who are going into bankruptcy are going 
into bankruptcy because their health insurance has failed or they do 
not have health insurance. They go to the hospital for 4 days and they 
run up these enormous bills.
  What the current proposal before the Senate is saying is, OK, that is 
going to be too bad. We are going to suck up the 25 years of payments 
into retirement programs for working families.
  We say, we do not do it for the 401(k) programs, which are the 
retirement programs for the more wealthy and affluent. We should not do 
it for the IRAs. Starting now, at $1 million, it will just continue to 
come down. And we are putting these savings at risk. It does not belong 
in this bill. I hope my amendment will eliminate it. I think it is the 
proper way to proceed.
  Mr. SESSIONS addressed the Chair.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SESSIONS. I thank Senator Kennedy. I know we worked hard on this 
bill to gain his support. Basically, the language that is in the bill 
now has been modified to deal with a number of the concerns he raised.
  The Department of Justice, under the Clinton administration, said:

       A debtor should not be able to shield abundant resources 
     from creditors, including Federal, State, and local 
     governments, in the form of retirement savings.

  What is ``abundant resources''? We say, over $1 million. I do not 
think that is too much to allow somebody to keep when they are not 
paying their debts.
  From the Securities and Exchange Commission:

       We have seen insider traders, who do their trading through 
     IRAs, and fraud participants stash their profits in IRAs. The 
     State law exemptions have not defeated our Federal statutory 
     claims to date, but a new Federal exemption--

  Which we could be doing here--

     could do so. I am concerned about the grave potential for 
     abuse that the exemption for all retirement assets from 
     bankruptcy estate poses.

  We have asked--and the Senator from Massachusetts and others voted 
for an amendment I sponsored--to limit homesteads to $100,000 as the 
amount you could put in your homestead and not pay your debtors. Yet 
there is an objection for some reason to saying you can't maintain more 
than $1 million in your IRA and not pay your debts.
  This is a reasonable cap. It will not hurt people. It will allow them 
to have an income of $60,000 or more per year to live on without even 
touching their principal under this IRA plan. It will, as the 
Securities Commission says, avoid the dangers of fraud and just the 
unfairness of not paying your local businesses, not paying your local 
hospital, not paying your local neighbors what you owe and living high 
on the hog with multimillions of dollars, perhaps, stuffed in an IRA 
plan.
  That is why we are in disagreement on this bill.


                 Vote on Amendment No. 27, As Modified

  Mr. SESSIONS. Mr. President, I move to table both the Kennedy and 
Feinstein amendments. I ask unanimous consent to do that.
  The PRESIDING OFFICER (Mr. Chafee). It is not in order to move to 
table both amendments at this time. The Senator may move to table the 
Feinstein amendment.
  Mr. SESSIONS. Mr. President, I move to table the Feinstein amendment 
and ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  Mr. KENNEDY. Mr. President, is there time remaining on the amendment?
  The PRESIDING OFFICER. There is not time remaining.
  The question is on agreeing to the motion to table the Feinstein 
amendment No. 27, as modified. The yeas and nays have been ordered. The 
clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  Mr. NICKLES. I announce that the Senator from Oklahoma (Mr. Inhofe) 
is necessarily absent.
  I further announce that if present and voting, the Senator from 
Oklahoma (Mr. Inhofe) would vote ``yea.''
  Mr. REID. I announce that the Senator from Hawaii (Mr. Inouye) is 
necessarily absent.
  The result was announced--yeas 55, nays 42, as follows:

                      [Rollcall Vote No. 20 Leg.]

                                YEAS--55

     Allard
     Allen
     Bayh
     Bennett
     Biden
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chafee
     Cleland
     Cochran
     Collins
     Craig
     Crapo
     DeWine
     Domenici
     Dorgan
     Ensign
     Enzi
     Frist
     Gramm
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Johnson
     Kohl
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Voinovich
     Warner

                                NAYS--42

     Akaka
     Baucus
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carnahan
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham
     Harkin
     Hollings
     Jeffords
     Kennedy
     Kerry
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murkowski
     Murray
     Nelson (FL)
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Torricelli
     Wellstone
     Wyden

                        ANSWERED ``PRESENT''--1

       
     Fitzgerald
       

                             NOT VOTING--2

     Inhofe
     Inouye
       
  The motion was agreed to.
  The PRESIDING OFFICER (Mr. Enzi). The Chair recognizes the Senator 
from Alabama.
  Mr. SESSIONS. Mr. President, I move to reconsider the vote.
  Mr. HATCH. Mr. President, I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                        Vote On Amendment No. 39

  Mr. SESSIONS. Mr. President, I move to table the pending amendment 
and ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?

[[Page S2180]]

  There is a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  Mr. REID. I announce that the Senator from Hawaii (Mr. Inouye) is 
necessarily absent.
  The result was announced--yeas 61, nays 37, as follows:

                      [Rollcall Vote No. 21 Leg.]

                                YEAS--61

     Allard
     Allen
     Bayh
     Bennett
     Biden
     Bingaman
     Brownback
     Bunning
     Burns
     Campbell
     Carnahan
     Carper
     Chafee
     Cleland
     Cochran
     Collins
     Conrad
     Craig
     Crapo
     DeWine
     Domenici
     Dorgan
     Ensign
     Enzi
     Frist
     Gramm
     Grassley
     Gregg
     Hagel
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Johnson
     Kohl
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (FL)
     Nelson (NE)
     Nickles
     Reid
     Roberts
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Stabenow
     Stevens
     Thomas
     Thompson
     Thurmond
     Torricelli
     Voinovich
     Warner

                                NAYS--37

     Akaka
     Baucus
     Bond
     Boxer
     Breaux
     Byrd
     Cantwell
     Clinton
     Corzine
     Daschle
     Dayton
     Dodd
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham
     Harkin
     Hatch
     Hollings
     Jeffords
     Kennedy
     Kerry
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Reed
     Rockefeller
     Sarbanes
     Schumer
     Specter
     Wellstone
     Wyden

                        ANSWERED ``PRESENT''--1

       
     Fitzgerald
       

                             NOT VOTING--1

       
     Inouye
       
  The motion was agreed to.
  Mr. GRASSLEY. I move to reconsider the vote and move to lay that 
motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The question now occurs on amendment No. 41.
  Mr. GRASSLEY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will please call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DURBIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________