[Congressional Record Volume 147, Number 33 (Tuesday, March 13, 2001)]
[Senate]
[Pages S2184-S2214]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                BANKRUPTCY REFORM ACT OF 2001--Continued

  The PRESIDING OFFICER. Under the previous order, there will now be 30 
minutes for closing remarks on amendment No. 29, as modified, and 
amendment No. 32 to be equally divided in the usual form.
  The Senator from North Dakota is recognized.


                     Amendment No. 29, as modified

  Mr. CONRAD. Mr. President, my amendment is designed to protect the 
Social Security trust fund and the Medicare trust fund. It has been 
called the Medicare-Social Security lockbox. That is a good 
description. It is designed to try to prevent these trust funds from 
being used for other purposes, from being used as we saw in the past 
for spending on other programs.
  A quick description of what my amendment provides is the following:
  First, it protects Social Security surpluses in each and every year;
  Second, it takes the Medicare Part A trust fund off budget just as we 
have taken the Social Security trust fund off budget, again to try to 
protect it from being raided and used for other purposes;
  Third, it gives Medicare the same protections as Social Security;
  Fourth, it provides strong enforcement legislation and strong 
enforcement provisions to make certain that protections hold.
  The alternative--the legislation that will be offered by my 
colleague, the Senator from New Mexico, chairman of the Senate Budget 
Committee--does not take Medicare off budget. It contains huge 
trapdoors for anything labeled ``Social Security and Medicare reform.''
  In other words, they have a lockbox that leaks. They have a lockbox 
where the door is wide open. The money can be used for other purposes 
as long as they call it Social Security or Medicare reform. There is 
absolutely no definition of what constitutes Social Security or 
Medicare reform.
  The proposal of my colleague does not add any new protections for 
Social Security and does not protect Medicare from sequester. This 
constitutes what I call the broken safe. The door is wide open to what 
my colleague from New Mexico is presenting.
  Under the President's budget, not a penny is reserved for Medicare. 
In fact, the President takes the Medicare trust fund and puts it into a 
so-called contingency fund available for other purposes. In fact, as we 
have already heard, he went to my State and told folks there that if 
they need money for agriculture, go to the contingency fund. If people 
need money for defense, they are being told to go to the contingency 
fund. If they need more money for education, go to the contingency 
fund. If they need money for a prescription drug benefit that really 
delivers something, go to the contingency fund. That money is going to 
be spent four or five times over.
  Some on the other side say: Look, there is no trust fund surplus in 
Medicare.
  That is not what the Congressional Budget Office says. On page 9 of 
the ``Budget Outlook,'' under the table ``Trust Fund Surpluses,'' they 
start with Social Security. Then they go to Medicare. And they point 
out that Part A of Medicare has over a $400 billion surplus. They point 
to Medicare Part B. And that is in rough balance over the 10 years of 
this forecast period.
  Some on the other side say: Oh, there is a huge deficit in Medicare 
Part B; therefore, we should not worry about the surplus in Medicare 
Part A. I just say to them, the law does not say that. The actuaries do 
not say that. Medicare Part A is in surplus. Medicare Part B is in 
rough balance. There is no justification for taking the Medicare trust 
fund that is in surplus and moving that money into this so-called 
contingency fund that is available for other spending. That is 
precisely what will get us into financial trouble in the future.
  I hope my colleagues will support having a protection mechanism for 
both the Social Security trust fund and the Medicare trust fund. It 
makes sense for the country, it makes sense for taxpayers, and it makes 
sense for beneficiaries. Most of all, it makes fiscal sense. And that 
is what my amendment is all about: to wall off the Social Security 
trust fund and the Medicare trust fund so they cannot be raided for 
other purposes.
  I thank the Chair and yield the floor.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. First, let me say I am very pleased this afternoon to 
be on the floor with Senator Conrad. I think those who watch the Senate 
as it conducts business are probably, in the next 3 weeks, going to see 
a lot of us because we will have the whole budget up here for at least 
a week. Senator Conrad manages it for the other side of the aisle, and 
I manage it on this side.
  I am very hopeful that, while this is a very interesting and somewhat 
difficult issue today, we will handle it in a very civil manner between 
the two of us as to what we ought to do.
  First of all, everybody should know that when we offered a lockbox on 
Social Security on this side--it is the only one you could really call 
a lockbox--the other side of the aisle opposed it because it was too 
rigid. And

[[Page S2185]]

they found out from the Secretary of the Treasury it may have been even 
too difficult for the U.S. Government to manage in terms of managing 
its debts.
  So we have come from that point to what we generally call a lockbox 
here, to make any expenditures from that fund that are not authorized 
in that law itself subject to a 60-vote point of order. That generally 
is called a lockbox because it will call it to the attention of those 
affected, and it will require a supermajority to vote for it. That is 
what our amendment does for both Social Security and Medicare. But what 
it does in both programs is exactly what the House did. It passed by 
over 400 votes. Essentially, it says only for Social Security and/or 
Social Security reforms. And on Medicare it says Medicare Part A and/or 
reforms.
  My distinguished friend on the other side of the aisle would say we 
take Medicare off budget. We no longer get to count it as an asset of 
the budget. And in addition, it cannot be used for the reforms that are 
going to be necessary when we improve that program and add to it 
prescription drugs.

  So the difference is big. As a matter of fact, it is as if my friend 
on the other side of the aisle had concocted an approach so we cannot 
get a tax cut because, for some reason, the $1.6 trillion tax cut just 
is not within the grasp of those on the other side. They do not want to 
give that back to the American people. In a moment, or in closing 
arguments, I will share with you the fact that it is a very responsible 
tax cut. It is very small in proportion to the total tax take of the 
United States of America.
  But for now let me just, again, discuss these two issues.
  First, the distinguished Senator, Mr. Kent Conrad, my opponent here 
would take Medicare off budget and not permit it to be used for reform 
and say to us, use it to pay down the debt. I want to just take a 
minute to talk about the debt because everybody ought to understand.
  The President of the United States has asked us to reduce the debt of 
the United States from $3.2 trillion to $1.2 trillion--a $2 trillion 
reduction. The President says--as did President Clinton before him who 
also said, through his experts--that is all we can pay down without 
paying a big penalty and costing the American taxpayers money.
  This little chart I have here shows what is going to happen to the 
ownership of American debt as we buy down the debt and attempt to 
minimize it. You can see, the red is all foreign investment and 
foreigners. That grows because they do not want to sell the American 
bonds. They hold on to them. I understand that if we said, you are 
going to pay those people anyway, even though they do not want to 
sell--they are under an arrangement they like in terms of the terms of 
the bonds--then what we would have to do is we would have to pay a 
premium that would cost the American people a 21-percent premium on the 
money we pay to them to buy down the bonds. We will pay a 21-percent 
premium.
  Isn't it amazing that we are being asked to vote for an amendment 
that, on the one hand, is calculated to prevent us from getting a tax 
reduction for the American people, and, on the other hand, 
unintentionally, I assume, we are going to have to pay that money at a 
21-percent premium to foreign countries and foreigners from whom we are 
going to buy these bonds because we are going to say to them: If you 
don't want to sell them, we want you to sell them anyway. It is similar 
to a marketplace gun you put there and say: Sell them to us. And, of 
course, we will throw away money in the process.
  The amendment that will be voted on second is their lockbox and its 
operation. It is a lockbox for which everybody in this Senate has 
voted. It requires a 60-vote majority to use any of the Social Security 
trust fund for anything but Social Security or Social Security reform. 
It is the same lockbox on Medicare that we voted for heretofore on a 
number of occasions that says, Medicare cannot be used--I say to the 
Finance Committee chairman, who is bound by all these rules--for 
anything other than Medicare and/or Medicare reform.
  I note the presence of the chairman of the Finance Committee. I note 
my friend, who is on the other side of the aisle on this issue, is a 
member of the Finance Committee. They have a very important job. They 
are going to have to decide whether they want to reform Medicare.
  As a matter of fact, it is most interesting, for those who are 
interested in this debate, we had not had a formal Medicare reform put 
forth by the former President for 8 years. We have not had one put 
forth by the other side of the aisle, except in the Breaux-Frist 
amendment or bill which came out of a commission. We still do not have 
one from the other side of the aisle. I do not know why.

  I am very hopeful the Finance Committee will, indeed, produce a 
bipartisan Medicare reform proposal--under the Domenici amendment, 
which is the second amendment, that can be done--because without 
reforms, the Medicare trust fund is doomed. There will not be enough 
money for the senior citizens.
  As the chart demonstrates, by 2010, the spending exceeds the income; 
by 2018, the spending exceeds the income plus interest; and by 2026, 
the trust fund is depleted.
  We already have heard testimony from experts that our tax reduction 
of $1.6 trillion does not have anything to do with that. What has to do 
with that is that you must reform the Medicare system in order to get 
your job done.
  I close by saying, I think the Medicare trust fund should be used for 
Medicare reform. I do not think it should be used to pay huge premiums 
to foreign countries and foreigners by trying to coerce them to buy the 
debt.
  My last observation is, Medicare is a very mixed program. Part of it 
is paid out of the trust fund until there is no money. Then what will 
we do? And part of it, a big part of it, including doctors, home health 
care, and a long list of items, is paid for under Part B, which is the 
general taxpayer.
  How would you split them apart and take one and put it off budget, to 
be used for debt service, and the whole other one just left there to be 
paid by the taxpayer?
  I believe reform should include a process that would envision both of 
those problem areas and reform them, to the future benefit of our 
senior citizens.
  I have great admiration for my friend on the other side, but I do 
think on this one, it is subject to a point of order and we ought to 
let it die. We ought to vote on the second one and approve it because 
the House did it, and it could become law because it would be the same 
as theirs. It is a very good way to attempt to save Medicare for 
nothing other than Medicare.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Mr. President, let me respond briefly and then we will 
have a chance to hear from the chairman of the Finance Committee.
  Senator Domenici said Democrats voted against a lockbox last year. 
That is only part of the story. Democrats voted for the lockbox that 
passed on a bipartisan basis. We voted against one version of the 
lockbox that threatened, according to the Secretary of the Treasury, 
the ability of Congress to pay the national debt. Yes, we voted against 
the lockbox provision that threatened the good credit of the United 
States, but we supported the lockbox that protected Social Security and 
Medicare that passed on a bipartisan basis.
  Second, the Senator says the House passed, by a huge margin, the 
lockbox he is offering. The House was not permitted to consider an 
alternative. This alternative, the one I am offering that passed the 
Senate last year, is far stronger.
  Third, the Senator says we would take the Medicare Part A trust fund 
off budget. That is exactly right. We would treat it the same way we 
treat the Social Security trust fund to give it the full protection it 
deserves.
  Finally, the Senator says we threaten Medicare reform and the ability 
to write a prescription drug benefit. That is not the case. My 
amendment creates a point of order against legislation that makes the 
trust fund less solvent, not more solvent. Medicare reform is intended 
to make Medicare more solvent, not less solvent. In addition, new 
spending for a drug benefit would not reduce the Part A surplus and, 
therefore, would not be subject to any point of order under my 
amendment.

[[Page S2186]]

  This measure is not meant to defeat a tax cut or any other measure. 
It is designed to protect the Social Security and Medicare trust funds. 
This is what we voted for on a bipartisan basis last year. I hope we 
will do the same this year and say, whatever else we do, we are not 
going to raid the trust funds of Social Security and Medicare.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I yield myself 4 minutes of the time 
remaining.
  Senator Conrad's amendment is very bad medicine for our seniors, in 
terms of this fuzzying up the issue. If we allow this to happen, we are 
going to perpetuate the hoax that Medicare is running a surplus so that 
we can postpone urgently needed improvements in Medicare.
  The Senator's amendment also leads Americans into believing we can't 
provide tax relief for hard-working families and at the same time 
protect Medicare and Social Security. The Senator is just plain wrong 
because over the next 10 years we will be spending $3.8 trillion just 
on Medicare. That is more than two times the size of any proposed tax 
cut. To say that we on this side of the aisle are shortchanging seniors 
is ludicrous. In fact, the Senator's amendment would shortchange 
Medicare patients by splitting Medicare in half and leaving Part B of 
the program, including prescription drugs, unprotected.
  In 1993, Congress voted to tax up to 85 percent of Social Security 
benefits and transfer those taxes into the Part A trust fund. In 1997, 
Congress voted to transfer the cost of home health out of Part A trust 
fund into Part B. Had these two actions not occurred, there would be no 
surplus in Part A. Medicare Part B will run a deficit of more than $1 
trillion over the next 10 years, completely offsetting the $400 billion 
surplus in Part A. Splitting Medicare in half would only further these 
accounting gimmicks and mislead seniors into believing Medicare is 
secure. Of course, we know that is not the case.
  We think it is time to be very open with our seniors about Medicare's 
financial condition. We have the opportunity this year to modernize 
Medicare, provide prescription drug coverage, and put the program on a 
sound footing for our seniors, particularly for baby boomers. We want 
to protect the Medicare surplus so it can be used for this purpose, and 
this purpose only.
  Senator Conrad's amendment will deprive seniors of what they need 
most, a stronger, updated Medicare program, by locking away the 
Medicare dollars and making them unavailable for much-needed 
improvements. Is this what our seniors want? I don't think so. They 
want something for future generations.
  This lockbox approach has one additional problem: When you add it to 
the additional one-third of the on-budget surplus the amendment would 
then reserve for debt reduction, it would equal $3.8 trillion. That 
exceeds the total amount of publicly held debt by $700 billion, and it 
exceeds the amount of debt available to be repaid by $1.5 trillion. As 
a result, the Government will be forced to invest the excess surplus in 
the private sector.
  Federal Reserve Chairman Greenspan has warned that such investments 
could disrupt financial markets and reduce the efficiency of our 
economy. My colleague from New Mexico has said that very well and 
demonstrated it with the chart.
  Moreover, it is important to remember that the Senate has already 
voted 99-0 in the year 1999 against allowing the Government to invest 
the Social Security surplus in the private sector.
  I oppose the amendment by the Senator from North Dakota and support 
Senator Domenici's amendment.
  The PRESIDING OFFICER. Who yields time?
  Mr. CONRAD. I yield time to the Senator from Montana.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I very much appreciate the points made by 
our good friend from New Mexico, the chairman of the Budget Committee, 
as well as by Senator Grassley, the chairman of the Finance Committee.
  However, the long and short of it is, the amendment offered by 
Senator Conrad is very simple. It is probably the only responsible 
thing to do. Essentially it says Social Security trust fund money is to 
be kept for Social Security. We are going to keep it in the trust fund 
so the trust fund continues to build. It also says that the Medicare 
Part A trust fund money is to be kept in that trust fund to be used as 
it is supposed to be used.
  To be honest, we hear lots of arguments on the other side, but, 
frankly, they sound like Senators doing the administration's bidding by 
trying to desperately grab shoestring kinds of arguments to try to 
counter this amendment. If we look at all the arguments, they are 
transparently false.
  No. 1, we are playing footloose with senior citizens because it would 
make it sound as if the Medicare Part A trust fund is in good shape. 
The fallacy of that is, if we rob Peter to pay Paul, if we rob Part A 
to pay for Part B, it is going to make the Medicare problem more 
urgent. I don't think any senior wants that.
  Second, we hear: Those Democrats don't want to reduce taxes. That is 
a patently false argument. We are just saying protect Social Security, 
protect Medicare, because that is what our seniors expect, and that is 
what the baby boomers certainly expect when they retire on down the 
road.
  Third, we hear the argument, gee, if this amendment passes, you are 
going to have to pay a 21-percent premium on foreign debt. That is 
totally false. Nobody knows where those figures come from, except I 
hear them from my good friend from New Mexico.
  It is true that if this amendment were to be enacted, as it very much 
should, then earlier, rather than later, we could be facing the 
question of debt retirement and what debt would be involved and what 
not. But there are other options. We can use the money for other forms 
of savings--that is savings provisions outside Social Security or 
Medicare. Or if we come to the premium question on redeeming debt, we 
will cross that bridge when we get there. Nobody knows what the premium 
is. There is a debt rescheduling going on currently. We are buying back 
debt, and it is working.

  My main point is that this is a very simple amendment. It is the most 
responsible thing to do because it starts to protect Social Security 
and Medicare for senior citizens and for the future.
  I might add, Mr. President, the alternative amendment we are going to 
be asked to vote on has, as I think the Senator from North Dakota 
characterized it, a trapdoor. It is a ``nothing'' amendment. It doesn't 
do what it purports to do. If you want honesty in budgeting and in 
amendments, honesty in what provisions actually say, I ask you to look 
at the language of the amendment offered by the Senator from North 
Dakota and look at the language of the alternative. You will very 
clearly see, if you read the language, one does protect Social Security 
and Medicare, the other does not.
  The PRESIDING OFFICER. The Senator from North Dakota is recognized.
  Mr. CONRAD. Mr. President, I want to respond briefly to my colleague 
from Iowa who said a series of things that are just not so. He said 
this amendment is bad medicine for seniors. Come on. This amendment 
protects the Social Security trust fund, and it protects the Medicare 
trust fund. It prevents them from being looted and raided for other 
purposes. That helps seniors.
  He says it suggests there is a trust fund surplus in Medicare. It 
doesn't just suggest it; there is one. This is from the Congressional 
Budget Office. It says very clearly there is $400 billion in surpluses. 
The President's budget says $500 billion in the Medicare trust fund.
  The Senator from Iowa says you can't have a tax cut with this 
amendment. Nonsense. You can have a tax cut with this amendment. This 
only says don't raid Social Security, don't raid Medicare. The only way 
it endangers a tax cut is if their intention is to raid Social Security 
and Medicare to pay for one.
  Now, finally, Senator Grassley has the plan I have talked about being 
all mixed up. He has taken the $2.9 trillion dedicated for reduction of 
the publicly held debt and he added that to the $900 billion that is 
reserved for strengthening Social Security for the long term and says 
all of that money is designed

[[Page S2187]]

to deal with short-term debt. Wrong. That is just wrong. The $2.9 
trillion is to eliminate our short-term debt. The $900 billion is to 
deal with long-term debt. Unfortunately, they have not set aside any 
money to deal with long-term debt.
  This amendment is simple. It is designed to protect the trust funds 
of Social Security and Medicare against raids for other purposes.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico is recognized.
  Mr. DOMENICI. Mr. President, I think the Medicare trust fund should 
be used for Medicare and Medicare reform. I don't think we should use 
it to fund, in any way, a requirement that we pay huge premiums--some 
estimate as high as 21 percent--to attract foreign investors to retire 
our debt.
  I yield whatever time I have to Senator Frist.
  Mr. FRIST. Mr. President, I rise to sustain the point of order 
against the proposal of the Senator from North Dakota for three 
reasons. No. 1, our trust funds need to be strengthened by combining 
the hospital trust fund with the physician trust funds. That is 
Medicare. You need physicians and hospitals. The real question is, What 
do we do with the surplus on the hospital side? Medicare has a deficit. 
I think we should not tell taxpayers we are going to take that money 
and use it to pay down the debt. We ought to reassure them that we can 
take that money forward and use it to modernize Medicare, strengthen 
it, eliminate the redtape, and install tools in our Medicare system 
that explain and get rid of the fact that an aspirin may cost $2. That 
makes our seniors mad.
  Third, and last, every nickel that the taxpayer pays today will go 
for Medicare, will be used for Medicare. The President has said it. The 
underlying amendment by the Senator from New Mexico also will guarantee 
that every nickel paid in will be used for Medicare.
  The PRESIDING OFFICER. The Senator from North Dakota has 1 minute 41 
seconds remaining.
  Mr. CONRAD. Mr. President, the argument of my colleague from New 
Mexico that somehow we are going to be paying big premiums to foreign 
debtholders has nothing to do with my provision here. My provision 
protects the trust funds of Social Security and Medicare against raids 
for other purposes. If you save the Social Security and Medicare trust 
funds in that way, there is no cash buildup problem until the year 
2010--2010.
  If the issues the Senator from New Mexico addresses become a problem, 
we have a lot of time to deal with it. You can save every penny of 
these trust funds and not have any of the problems he talked about, at 
least until the year 2010. Many of us believe we will never have them.
  Mr. President, what is this amendment about? It is very simple: It 
says we are going to provide the same protection to the Medicare trust 
fund that we provide the Social Security trust fund. It says we are 
going to provide additional protection to the Social Security trust 
fund so that this Congress can't go back to the bad old days of raiding 
every trust fund in sight to pay for other purposes. That is what we 
used to do. We have stopped that practice. Let's make certain it 
doesn't start again. Let's protect the trust funds of Social Security 
and Medicare. It is the fiscally responsible thing to do.
  Pursuant to section 904 of the Congressional Budget Act, I move to 
waive the applicable sections of the act and ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. CONRAD. Mr. President, I also raise a point of order that the 
pending Sessions amendment violates section 306 of the Congressional 
Budget Act of 1974.
  The PRESIDING OFFICER. That point of order will be recognized when 
that amendment comes up. First, the Senate will vote on the motion to 
waive.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  The result was announced--yeas 53, nays 47, as follows:

                      [Rollcall Vote No. 22 Leg.]

                                YEAS--53

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carnahan
     Carper
     Cleland
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Fitzgerald
     Graham
     Harkin
     Hollings
     Inouye
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Miller
     Murray
     Nelson (FL)
     Nelson (NE)
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Smith (OR)
     Specter
     Stabenow
     Torricelli
     Wellstone
     Wyden

                                NAYS--47

     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Cochran
     Collins
     Craig
     Crapo
     DeWine
     Domenici
     Ensign
     Enzi
     Frist
     Gramm
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Jeffords
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Snowe
     Stevens
     Thomas
     Thompson
     Thurmond
     Voinovich
     Warner
  The PRESIDING OFFICER (Mr. Crapo). On this vote, the yeas are 53, the 
nays are 47. Three-fifths of the Senators duly chosen and sworn not 
having voted in the affirmative, the motion is rejected.
  Mr. DOMENICI. Mr. President, I move to reconsider the vote.
  Mr. SANTORUM. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                            Amendment No. 32

  Mr. DOMENICI. I make a point of order on the Conrad amendment.
  On the next amendment, does the Senator from North Dakota want to 
raise a point of order?
  Mr. CONRAD. Mr. President, I raise a point of order that the pending 
Sessions amendment violates section 306 of the Congressional Budget Act 
of 1974.
  The PRESIDING OFFICER. Does the senator from New Mexico raise a point 
of order?
  Mr. DOMENICI. Has the point of order been ruled on?
  The PRESIDING OFFICER. The point of order has not been ruled on. The 
Senator from New Mexico has raised a point of order.
  Mr. DOMENICI. Yes; he has. The point of order is that the Conrad 
amendment violates the Budget Act.
  The PRESIDING OFFICER. On the amendment of the Senator from North 
Dakota, the Senator from New Mexico has raised a point of order that it 
violates the Congressional Budget Act. Since this is a matter of 
jurisdiction of the Senate Budget Committee, the point of order raised 
by the Senator from New Mexico is sustained and the amendment falls.
  Mr. CONRAD. Mr. President, parliamentary inquiry.
  Mr. WELLSTONE. Mr. President, could we have order in the Chamber? We 
can't hear.
  The PRESIDING OFFICER. The Senate will come to order.
  Mr. CONRAD. Parliamentary inquiry: Didn't the Senator from New Mexico 
have to have raised a point of order against my amendment before the 
amendment was voted on?
  The PRESIDING OFFICER. The amendment was not voted on. The Senate 
voted on a motion to waive the Budget Act.
  Mr. CONRAD. Mr. President, is it in order at this point for me to 
raise a point of order against the amendment?
  The PRESIDING OFFICER. A point of order is now timely.
  Mr. CONRAD. I raise a point of order that the pending Sessions 
amendment violates section 306 of the Congressional Budget Act of 1974.
  Mr. DOMENICI. I move to waive that pursuant to the appropriate 
provisions of the law and ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion to waive the Budget Act in 
relation to the Sessions amendment No. 32. The clerk will call the 
roll.
  The legislative clerk called the roll.
  The yeas and nays resulted--yeas 52, nays 48, as follows:

[[Page S2188]]

                      [Rollcall Vote No. 23 Leg.]

                                YEAS--52

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

                                NAYS--48

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carnahan
     Carper
     Cleland
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham
     Harkin
     Hollings
     Inouye
     Kennedy
     Kerry
     Kohl
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Torricelli
     Wellstone
     Wyden
  The PRESIDING OFFICER. On this vote, the yeas are 52, the nays are 
48.
  Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The Chair will now rule on 
the point of order.
  Mr. HATCH. Mr. President, I move to reconsider the vote. I am sorry.
  The PRESIDING OFFICER. The Senator from Utah is correct in moving to 
reconsider.
  Mr. REID. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Chair will now rule on the point of order. 
The amendment of the Senator from Alabama would add a new point of 
order to the Budget Act. Since this is a matter within the jurisdiction 
of the Senate Budget Committee, the point of order is sustained and the 
amendment falls.
  The Senator from Connecticut.
  Mr. DODD. Mr. President, just so we understand the order of things 
here, as I understand it, my friend from Utah has a brief statement he 
wants to make, and then my colleague and friend from New York has a 
request to make, and then I would ask unanimous consent, at the 
conclusion of both of these, the statement and request, that the 
Senator from Connecticut be recognized to offer an amendment.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. DURBIN. Mr. President, reserving the right to object, I would 
like to put my name in the queue after the Senator from Connecticut has 
offered an amendment.
  The PRESIDING OFFICER. Does the Senator from Utah raise an objection?
  Mr. HATCH. I do raise objection to that.
  The PRESIDING OFFICER. Objection is heard.
  Mr. DURBIN. Mr. President, I withdraw my reservation and suggestion.
  The PRESIDING OFFICER. Does the Senator from Utah raise an objection 
to the original request which would have the Senator from Connecticut 
following the two statements?
  Mr. HATCH. Would the Chair tell me the original request?
  Reserving the right to object, what is the original request?
  The PRESIDING OFFICER. The original request was that the Senator from 
Connecticut be recognized to offer an amendment following a statement 
by the Senator from Utah and a request by the Senator from New York.
  Mr. HATCH. Repeat the request one more time.
  The PRESIDING OFFICER. The Senator from Connecticut has requested 
that following the statement of the Senator from Utah and a request by 
the Senator from New York, he be recognized to offer an amendment. Is 
there objection to the request?
  Mr. HATCH. Is the offer of the Senator from New York an offer to make 
a statement only, or does the Senator want to call up an amendment?
  Mr. SCHUMER. What I would like to do is get a time. I was assured, 
when I brought this amendment up last time, that we would get a vote on 
it. The regular order is still our amendment. We departed from it to do 
many other things. I want to get that assurance before the cloture vote 
tomorrow, that I get a set time when we can do that, which Senator 
Grassley assured me of, as I can read here in the Record.
  Mr. HATCH. Mr. President, let me object for now until Mr. Gramm, the 
Senator from Texas, arrives on the floor.
  The PRESIDING OFFICER. Objection is heard.
  Mr. SCHUMER. Will the Senator yield?
  Mr. HATCH. I yield for a question.
  Mr. SCHUMER. I would say to the Senator, I have no problem waiting 
until we touch base with Senator Gramm. I want to make as part of this 
order that I would then be allowed to take the floor and renew my 
request.
  Mr. HATCH. Why don't we ask unanimous consent that I be allowed to 
make a statement as if in morning business and then the distinguished 
Senator may make his statement until the distinguished Senator from 
Texas gets here.
  Mr. SCHUMER. Is he on his way?
  Mr. HATCH. As I understand, he will be here in 5 minutes or so.
  The PRESIDING OFFICER. Is there objection?
  Mr. LEAHY. Reserving the right to object, I am not going to object to 
my friend from Utah making a statement under normal comity in this 
body. If I could have the attention of the Senator from Utah for a 
moment, I am obviously not going to object to his making a statement, 
nor would he object to my doing the same. I keep reading statements 
from some of the leadership that we should hurry up this bill so that 
we would be allowed to vote. The Senator from New York had his 
amendment here on Thursday of last week and hasn't been able to get a 
vote. We began the bankruptcy bill and it was pulled down at the 
request of the Republican leadership to bring up ergonomics. I hope 
that the Republican leadership will allow us to start having some votes 
on some of these amendments and not just wait until such time as we 
have a cloture vote.
  The PRESIDING OFFICER. The Senator from Utah has the floor.
  Mr. HATCH. Mr. President, does the Senator want me to yield for a 
question? I just want to make a statement.
  Mr. WYDEN. Mr. President, I ask unanimous consent to speak for 1 
minute.
  The PRESIDING OFFICER. Is there objection?
  Mr. HATCH. So long as I don't lose my right to the floor after he 
finishes his 1 minute.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. WYDEN. I thank my friend, the distinguished Chair. I am mostly 
interested in getting in the queue to offer an amendment with Senator 
Smith. I would like to yield to Senator Boxer for a moment because I 
know her time is short. She has consulted with us on this amendment. I 
would like to yield to her for a quick moment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. BOXER. May I just ask what the order is. Is there an amendment 
pending? Is Senator Wyden's amendment pending?
  Mr. HATCH. The Senator is asking me?
  The PRESIDING OFFICER. The Chair advises that a series of amendments 
have been offered. All have been set aside. There are 24 seconds 
remaining on the unanimous consent request.
  Mr. WYDEN. Mr. President, I wish to be in the queue here on an 
amendment on which I have worked with Senator Smith, and Senator Boxer 
would like to make a quick comment. I will yield back. I thank the 
Senator from Utah for his courtesy. I yield the floor.
  The PRESIDING OFFICER. The time of the Senator from Oregon has 
expired.
  Mr. HATCH. Mr. President, I understand we are going to go to Senator 
Schumer, and after the distinguished Senator from New York, the 
distinguished Senator from Connecticut.
  Mr. DODD. Mr. President, I was going to offer an amendment. I 
graciously yielded to a couple of things happening here. I am happy to 
yield to people to make statements unrelated to the bill, but I want to 
be protected. I would like to ask unanimous consent that at the 
conclusion of these remarks, I be allowed to offer an amendment.

[[Page S2189]]

  The PRESIDING OFFICER. Is there objection to the request?
  Mr. SCHUMER. Reserving the right to object, I don't have a problem 
with that, except that I want to make sure that before we get to that, 
I get to make my request.
  Mr. REID. Will the Senator from Utah yield for a brief statement on 
the subject matter before the Senate?
  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. REID. Mr. President, I say to my friend, the manager of the bill, 
along with Senator Leahy, there is no question that there are 
amendments that should be voted upon. However, the distinguished 
Senator from New York is in a little different category because when he 
allowed his amendment to be taken down, the manager of the bill at the 
time, the chairman of the Finance Committee, someone who has worked on 
this bill for so long, this bankruptcy bill, Senator Grassley of Iowa, 
said he would allow a vote on Senator Schumer's amendment. He said he 
didn't know when it would be, but there would be a guaranteed vote on 
that.
  So I want to make sure the Senator from New York--everybody realizes 
he is in a little different category than everyone else, even though 
there are many other votes that should take place. There is no question 
but that the Senator from New York has been guaranteed and assured 
there would be a vote on his amendment. That is why he agreed last week 
to take it down.
  The PRESIDING OFFICER. Is there objection to the request?
  Mr. HATCH. Mr. President, reserving the right to object, let me just 
say this. Let me make this statement: As I understand it, we are 
waiting for the distinguished Senator from Texas to get here because he 
has an amendment, I believe, to the amendment of the distinguished 
Senator from New York. And then I will put in a quorum call and we will 
get this resolved.
  The PRESIDING OFFICER. Is there objection?
  Mr. HATCH. I object.
  Mr. MURKOWSKI. Mr. President----
  The PRESIDING OFFICER. The Senator from Utah has the floor.
  Mr. HATCH. Mr. President, I ask unanimous consent that the Senator 
from New York be permitted to call up his amendment, that there is 
expected to be an amendment to his amendment by Senator Gramm, and I 
ask unanimous consent Senator Gramm be permitted to do that, and that 
we then go to the Senator from Connecticut.
  The PRESIDING OFFICER. Is there objection?
  Mr. SCHUMER. Reserving the right to object, I am not here to try to 
hold up the business. I want to make sure that since my amendment--I 
don't think we have to move to it because of the pending business. I 
want to make sure we get a time agreement as to when we are going to 
vote on my amendment.
  That is all I want. But I will not relinquish the floor or allow any 
amendment to be offered until we get a time.
  Mr. REID. Will the Senator yield?
  Mr. SCHUMER. I will be happy to yield.
  The PRESIDING OFFICER. The Senator from Utah has the floor.
  Mr. REID. Will the Senator from Utah allow me to make a brief 
statement?
  Mr. HATCH. I will be happy to.
  The PRESIDING OFFICER. Is there objection to the Senator's request?
  Mr. REID. I do not want him to lose the floor. I say to my friend 
from Utah, my friend from Vermont, and my friend from New York, I do 
not know where we got into the idea that we are going to have an 
amendment offered to Senator Schumer's amendment. I have the 
Congressional Record of March 8, 2001. Senator Grassley said:

       The point is we can assure the Senator from New York the 
     yeas and nays on his amendment, not someone else's amendment. 
     We can't assure the Senator from New York when we are going 
     to vote on this amendment, but there is going to be a vote on 
     the amendment.

  My only point is, how can we now change this to say we are going to 
be voting on a Gramm amendment? The Senator from New York was assured a 
vote on his amendment.
  Mr. SCHUMER. Reclaiming the floor.
  The PRESIDING OFFICER. The Senator from Utah has the floor. The 
pending matter is the unanimous consent request of the Senator from 
Utah.
  Mr. SCHUMER. Reserving the right to object.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. What I want to do--I see the Senator from Texas has come 
to the floor--is ask a question. Does the Senator from Texas have a 
second-degree amendment to my amendment which is the pending amendment?
  Mr. HATCH. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. HATCH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  Mr. SCHUMER. I object.
  The PRESIDING OFFICER. Objection is heard.
  The legislative clerk continued the call of the roll.
  Mr. HATCH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Is there objection?
  Mr. SCHUMER. I object.
  The PRESIDING OFFICER. Objection is heard.
  The legislative clerk continued the call of the roll.
  Mr. HATCH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Is there objection?
  Mr. DORGAN. I object.
  The PRESIDING OFFICER. Objection is heard.
  The legislative clerk continued the call of the roll.
  Mr. HATCH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Utah.
  Mr. HATCH. Mr. President, I ask unanimous consent that the 
distinguished Senator from Connecticut be permitted to proceed with his 
amendment with a half hour time limit equally divided, and that 
immediately after the vote on his amendment, the distinguished Senator 
from New York be given the floor on his amendment.

  Mr. DODD. Just to clarify how the amendment will be handled, will the 
Senator from Utah make it 45 minutes equally divided with no second 
degrees? Will the Senator add that element to it?
  Mr. SCHUMER. I object.
  The PRESIDING OFFICER. Objection is heard. The Senator from Utah has 
the floor.
  Mr. SCHUMER. I object. That is it.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, so everybody understands where we are, the 
Senator from New York brought up an amendment on Thursday. He was 
promised on the Record by the manager of the bill that he would get a 
vote. The Senator from New York is within his rights to ask for that 
vote.
  It seems to me to be a concern that everybody is holding things up so 
we cannot have votes. Is there any reason why we cannot set up a 
situation here--and both my friend from Connecticut and my friend from 
New York are on the floor--that we could have some kind of agreement 
that says, within the next 45 to 50 minutes, we could have at least two 
stacked votes, that of the Senator from New York and that of the 
Senator from Connecticut, with the understanding we can have one or two 
others after that; otherwise, we can spend as much time making 
unanimous consent requests to vote.
  Why would that not be sensible? It is not just enough to say the 
Senator from Connecticut will bring up his, and after his vote on it we 
will have somebody else, if the vote turns out to be tomorrow afternoon 
at 5. I want to get a few votes today.
  Mr. DORGAN. Will the Senator from Vermont yield for a question?
  Mr. LEAHY. Sure.
  Mr. DORGAN. I have not been involved in this discussion out here 
except to understand that today, yesterday, and Friday there was a 
great deal of complaining about this bill moving too slowly, it is not 
moving along, people are concerned and frustrated about it.
  My understanding is that the Senator from New York offered his 
amendment, was committed to having a record vote on his amendment, and 
now we see delay, delay, delay on getting him a record vote on his 
amendment.

[[Page S2190]]

  I ask the Senator from Vermont, is it his understanding the Senator 
from New York has a commitment that he will get a vote on his 
amendment?
  Mr. LEAHY. I tell my friend from North Dakota it is in the 
Congressional Record that the majority side gave a commitment to the 
Senator from New York to have a vote. I would like to know when that 
vote will occur. I am a man of great and deep abiding faith, and I even 
believe in miracles, but I would feel a little more comfortable if, 
instead of dealing with a miracle, we had a precise time.

  I suggest we have a vote at 4:45, 5, 5:15 or something like that on 
the amendment of the Senator from New York, and following that, a vote 
on the amendment of the Senator from Connecticut, followed by votes on 
other amendments.
  Mr. DORGAN. Is it the case if the Senator from New York does not get 
a vote and there is a cloture vote that prevails, the Senator from New 
York will not ever get a vote on his amendment?
  Mr. LEAHY. It is a possibility that the Chair may rule it is not 
germane and he would not get a vote, contrary to the commitment given 
by the Senate majority.
  Mr. WYDEN. Will the Senator yield?
  Mr. LEAHY. Without losing my right to the floor.
  Mr. WYDEN. I am baffled why it has been so difficult to set up a 
queue. I have an amendment with Senator Smith. I worked very closely 
with Senator Boxer to make some perfections on which she insisted. We 
are here to go with the queue so Senator Dodd's and Senator Schumer's 
interests are protected as well as others.
  Perhaps we could be enlightened what it will take to get a queue so a 
bipartisan amendment such as ours can go forward.
  Mr. LEAHY. I don't know. We have several pending amendments that 
could all be voted on. I have one or two. We have the yeas and nays 
ordered, and I am willing to have a 2- or 3-minute time agreement.
  I suggest to those who keep complaining about why this is taking so 
long, the amendments we know are going to require rollcall votes, we 
could dispose of more than half of them by 7 o'clock this evening.
  Mr. REID. Will the Senator yield?
  Mr. LEAHY. I yield without losing the floor.
  Mr. REID. Mr. President, we work in this body by unanimous consent, 
by agreement. The senior Senator from New York, in good faith, allowed 
the Senate to proceed on Thursday with the express agreement he would 
have a vote on his amendment. I know the good faith of the Senator from 
Texas. He believes, at least it is my understanding, that some of the 
subject matter in this amendment that the Senator from New York has 
brought is under the jurisdiction of the Banking Committee. That may be 
true. But the fact is, there was a gentleman's agreement in this Senate 
that Senator Schumer would have a vote on his amendment.
  I think it would set a bad tone in this bipartisan Senate if someone 
goes back on their word. When a manager of a bill is operating in the 
Senate, he is operating for the caucus that he represents--in this 
instance, Senator Grassley, one of the most senior Members, chairman of 
the Finance Committee. No one has been more heavily involved, with the 
possible exceptions of Senators Leahy and Hatch.

  I think we should get a time set to vote on the Schumer amendment. If 
my friend from Texas has an amendment, he should propose it.
  I think it will create a very difficult situation if someone such as 
Senator Schumer is told by a manager of the bill he will have a vote 
and suddenly that agreement is voided. That is, in effect, what is 
happening. It would set an extremely bad tone.
  Mr. LEAHY. I yield for the purpose of a question.
  Mr. GRAMM. I will get recognized on my own.
  Mr. SCHUMER. Will the Senator yield?
  Mr. LEAHY. I yield without losing my right to the floor.
  Mr. SCHUMER. I understand the difficulty we are in. I understand the 
difficulties of the Senators from Connecticut and Oregon. However, as 
was stated, I was promised a vote, unequivocally. I could have insisted 
on the vote then and there. The Senator from Texas wouldn't even have 
been on the floor to object. I didn't.
  I will repeat the words, because this has been going on long enough. 
I--Mr. Schumer--said, from the March 8 Record:

       If the Senator from Iowa will yield, as long as we get the 
     yeas and nays on this amendment in due course.

  Previous to that, the Senator from Iowa had requested that I 
temporarily lay aside the amendment.
  And Mr. Grassley said:

       The point is, we can assure the Senator from New York the 
     yeas and nays on his amendment.

  That is as good an assurance as one can get on this floor. I feel 
constrained to object to anything moving forward until we get an 
agreement as to when we will vote on my amendment. I offer this to 
think about. I know the Senator from Texas wants to study it. We could, 
for instance, debate the amendment of the Senator from Texas for 45 
minutes, debate my amendment for 45 minutes, and move to vote on both 
the amendment of the Senator from Connecticut and my amendment. Or we 
could use some other process.
  Until I am given an assurance that we will have a vote on this floor 
on this amendment, until I am given a time--I have been given an 
assurance; I should not have to be given a second--until I am given a 
time as to when we will vote on my amendment, I am constrained to 
object to every amendment, even those from friends, even those with 
whom I might agree.
  I yield.
  Mr. LEAHY. Mr. President, I will yield the floor in a moment. I know 
the Senator from Texas wishes to speak, and I don't want to deny him 
that privilege.
  The Senator from New York was given a commitment by the Republican 
leadership to have a vote. Frankly, at the rate we are going, I don't 
see that commitment being fulfilled. I have been here 26 years and I 
have never seen an instance where the majority--and I have been here 
three times the majority and three times the minority--I have never 
seen an instance where the majority has given such a commitment that 
hasn't been carried out.
  I urge Senators on both sides of the aisle to make sure this will not 
be the first time in 26 years such a commitment was not carried out. 
This is a very serious matter.
  There are only 100 Members who represent a nation of over a quarter 
of a billion people; 100 Members have a special responsibility because 
we are a small number. One is a responsibility to always carry forth 
our commitment. The Senator from New York has a commitment. It should 
be carried out. Frankly, we are only 3 months into this Congress. On a 
bill as serious as this, we should not have to be debating keeping a 
commitment that is laid out in the Congressional Record but, rather, 
try to find how to get the votes and vote amendments up or down.
  I have amendments. I am prepared to go to vote with a 2- or 3-minute 
time agreement. Let's not delay on the Senate floor and then hold press 
conferences by the Ohio clock saying: We can't understand why this bill 
is taking so long; I guess we have to file cloture.
  The fact is, the bill could have been finished last week if people 
had let the votes occur.
  The PRESIDING OFFICER. The Senator from Texas.
  Mr. GRAMM. Mr. President, first, I just came into this discussion. 
I've had a lot of people speaking on my behalf, and I greatly 
appreciate it, but I am even more appreciative of the right to speak 
for myself. I never made any agreement with regard to this amendment.
  One of my predecessors, Lyndon Johnson, used to say, ``I resent a 
deal I am not a party to.''
  Having said that, when I read Senator Grassley's comments in full, I 
do not see the deal that our dear colleague from New York sees. Senator 
Grassley says on March 8, on page S. 2032, ``The point is we can assure 
the Senator from New York the yeas and nays on his amendment. We can't 
assure the Senator from New York when we are going to vote on the 
amendment.''
  Reasonable men looking at the same facts are prone to disagree, as 
Thomas

[[Page S2191]]

Jefferson said. But it looks to me as if this is a commitment to have 
the yeas and nays on having a rollcall vote. I don't see any commitment 
about ending debate on the amendment in advance.
  Having said that, let me say what I want to say.
  No. 1, I will object to a time limit on any amendment within the 
jurisdiction of the Banking Committee from this point forward. We have 
all had a good time. We have debated a lot of amendments, many of which 
were of dubious merit and no relevance whatsoever to the underlying 
bill. But we have reached the point now where you are either for the 
bankruptcy bill or you are against it. I am for it. And I think we need 
to get on with our job. Cloture has been filed. We are going to vote on 
that tomorrow.
  What I am willing to do is sit down with the Senator from New York 
and his staff, if we can do that, and try to figure out exactly what it 
is he is trying to do, get an opportunity to raise concerns I have, and 
then basically make a decision as to whether we can move forward with 
an amendment or substitute. But in terms of reaching a resolution, the 
best use of our time would be to sit down for a few minutes with our 
staff and see if we can potentially work something out. I would like to 
propose that to my colleague from New York.
  Let me also make clear, it would make me happy to have no more 
amendments. I don't understand why we are continuing to have all these 
votes. If the Senator wants to hold the Senate up and not allow votes, 
that doesn't break my heart. But that is up to the Senator from New 
York. What I would like to do is see if something can be worked out and 
for the two of us and our staff to sit down and see if something can be 
worked out.
  Since there is confusion about what Senator Grassley meant, I don't 
have any doubt that the Senator from New York reads it the way he is 
saying it is written. I read it the other way. The point is, perhaps 
something can be worked out. However he wants to proceed, I think our 
time would be well spent to take about 10 minutes and sit down and talk 
to the amendment.
  With that, let me 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. HATCH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HATCH. Mr. President, I ask unanimous consent that the Senate now 
resume consideration of the Schumer amendment, No. 25, that the 
amendment be modified, and following a statement by Senators Gramm and 
Schumer--with Senator Gramm going first--for up to 5 minutes each, the 
amendment be temporarily laid aside in order for Senator Dodd to offer 
an amendment, No. 75.
  I further ask consent that there be 40 minutes equally divided for 
debate in relation to the Dodd amendment and, following that time, the 
Senate proceed to vote in relation to the Schumer amendment, to be 
followed immediately by a vote in relation to the Dodd amendment, and 
that no second-degree amendments be in order prior to the vote.
  I further ask consent that following those votes, the Senate proceed 
to consideration of the Wyden amendment, No. 78.
  The PRESIDING OFFICER. Is there objection?
  Mr. REID addressed the Chair.
  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. REID. Reserving the right to object, I, first of all, express my 
appreciation to the chairman of the Banking Committee for allowing us 
to go forward. I understand, as I indicated earlier in the day, the 
sincerity of his concern about this. I am happy to have him claiming 
jurisdiction. As I indicated to him, I have the same problem in my 
committee--Environment and Public Works--always trying to catch up to 
what the Energy Committee has done to us. So I express my appreciation 
of the entire Senate for the Senator's cooperation and also the 
patience of Senator Dodd and the general work of everyone. I think this 
is a good agreement and we can get rid of this bill in a timely 
fashion.
  Mr. HATCH. Mr. President, before you rule on my unanimous consent 
request, I would like to express my appreciation to both the 
distinguished Senator from Texas and the distinguished Senator from New 
York, and also the distinguished Senator from Oregon, as well as the 
distinguished Senator from Connecticut, for working out these various 
matters.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.


                     Amendment No. 25, As Modified

  The amendment (No. 25), as modified, is as follows:

       At the appropriate place, insert:

     SEC. 204. PRESERVATION OF CLAIMS AND DEFENSES UPON SALE OF 
                   PREDATORY LOANS.

       Section 363 of title 11, U.S. Code, is amended by adding at 
     the end the following:
       ``(p) Notwithstanding subsection (f), if a person purchases 
     any interest in a consumer credit transaction that is subject 
     to the Truth in Lending Act (15 U.S. Code 1601 et. seq.), or 
     any interest in a consumer credit contract as defined by the 
     Federal Trade Commission Preservation of Claims Trade 
     Regulation, and that interest is purchased through a sale 
     under this section, then that person shall remain subject to 
     all claims and defenses that are related to the consumer 
     credit transaction or contract, to the same extent as that 
     person would be subject to such claims and defenses of the 
     consumer had the sale taken place other than under title 
     11.''

  Mr. GRAMM addressed the Chair.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
Texas is recognized for up to 5 minutes.
  Mr. GRAMM. Mr. President, this is a very complicated issue. I am 
opposed to the amendment. There was a dispute about whether an 
agreement had been reached. I think you can read the language and argue 
it one way or the other, but the Senator from New York thought he had 
an agreement. And if he thought he had an agreement, I am willing to 
defer to it.
  Here is the whole argument in a nutshell. The amendment would affect 
insurance companies, mortgage companies, securities companies. It is a 
change in current law. Here is the whole issue.
  Currently, if I have a mortgage, or if I am a customer of a company, 
and the company holds an asset as a result of my doing business with 
them, when bankruptcy occurs and that company goes out of business--
declares bankruptcy--my ability to file a claim against those assets is 
severed. Why is that the case? It is severed because at that point the 
people who are creditors of the company that has gone bankrupt have 
first claim against its assets.
  If the amendment of Senator Schumer is adopted, well-intended as it 
is--and I am sure we will have dire examples of why it would be a good 
thing in some very limited cases--what it will really mean is that if I 
have a mortgage with a company that goes bankrupt, under current law 
the creditors of that company can sell that mortgage to try to pay off 
their debt. Under the Schumer amendment, at that point, never having 
raised any complaint whatsoever, I would have the right to come in and 
say: I believe there was something wrong. I never raised the point 
before, but now that the company has gone bankrupt, I want to claim 
that there is a problem with that loan and whoever bought the loan 
should carry the problem with them.
  Here is the problem in a nutshell: This will destroy the secondary 
market for the assets of bankrupt companies. Now, who will suffer? 
Senator Schumer is going to say, maybe these people are crooks. But 
they are not going to suffer. They went bankrupt. The people who are 
going to suffer are the creditors who won't be able to sell the assets 
of the company because there will be a potential cloud against those 
assets.
  This is a perfect case in point where, to correct a little wrong, you 
create a great big wrong that hurts ten thousand times as many people. 
The reason we have bankruptcy laws is that the first claim against 
assets goes to creditors, not people who may have real or imagined or 
made-up grievances against the company.
  Surely in the midst of bankruptcy law in a country where we have a 
sanctity of contracts and where creditors have first claim, we are not 
going to create a situation where we taint the assets of a bankrupt 
company so that

[[Page S2192]]

the people to whom the company owes money will end up not being able to 
get their money. That is the problem in a nutshell.

  I am not saying there may not be unscrupulous lenders. The point is, 
if you listen to Senator Schumer, he is, essentially, penalizing not on 
the unscrupulous party, but the people who are owed money. What we 
would do if this amendment passed is we would literally cloud the title 
and the marketability of every financial asset of every financial 
company in America.
  I hope this amendment will not be adopted. If it is adopted, I am 
determined that it not become law. I urge my colleagues to look at this 
amendment and keep in mind that bankruptcy law is primarily aimed at 
protecting creditors. Destroying the marketability of financial assets 
by creating the potential to raise new claims after the bankruptcy is 
something that cannot be in the public interest. It does nothing to 
hurt the bankrupt company.
  If we want to strengthen laws to put people in jail longer for bad 
lending practices, that is one thing. To punish creditors who have had 
nothing to do with this issue is fundamentally wrong.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New York is recognized for 5 
minutes.
  Mr. SCHUMER. Mr. President, I thank my colleagues from Nevada and 
Utah for helping, as well as Senators from Connecticut and Oregon.
  I say to my good friend, the Senator from Texas, his statements about 
the proposal are about as accurate as the statements about my title. I 
was elected to the Senate 2 years ago. He was calling me ``Congressman 
Schumer.'' He was about as accurate in my appellation as he is in his 
description of the amendment.
  First, this amendment is a simple amendment. When someone is terribly 
victimized because of a predatory lender, this amendment prevents that 
predatory lender from declaring bankruptcy, selling its loans into the 
secondary market, and then vamoosing, leaving the poor homeowner with 
nothing. This has happened time and time again. Predatory lenders have 
filed Chapter 11.
  United Companies, First Alliance, Conti Mortgage, all listed hundreds 
of individual suits, class actions, and State government enforcement 
actions pending when they filed. Worse yet, when they sold their loan 
portfolios, the purchasers of these loans were fully aware of the 
predatory claims pending and serious questions about whether all the 
mortgages were valid or enforceable.
  This is not some innocent creditor. Any creditor who buys loans in 
bankruptcy knows the score. And even when they do, under present law 
they can say to the poor homeowner who has basically been financially 
raped: Sorry, you have no claim against us. Go sue the bankrupt 
predatory lender.
  What this does in effect is allow new predatory lenders to exist 
because they know even if someone goes after them, having made all 
their money beforehand and paid it out in salaries and everything else, 
they can then sell the loans into the secondary market and start up the 
business in a new name. If the secondary lender knew they might be 
susceptible to the claims of the homeowner who was seduced, they 
wouldn't be so fast to buy the loan from the predatory lender.

  This is an amendment that is narrow. I supported the amendment by my 
colleague from Illinois, but that was much broader, dealing with all 
predatory lending. Not this. This only deals with those predatory 
lenders who declare bankruptcy as a means of escaping claims of people 
who have struggled, who have saved their $25 and $50 and $100 every 
week or month, so that they buy their home, and when they buy that 
home, they find that the home is in disrepair, that the mortgage is not 
what they were told, and their American dream is smashed.
  If this amendment is so detrimental to honest secondary mortgage 
buyers, then why do Fannie Mae and Freddie Mac support this amendment? 
They are the largest secondary market makers in the country when it 
comes to mortgages, far and away, and they are supportive. I am sure 
they are not doing something to damage themselves.
  This is not an overreaching amendment. It is a modest amendment. It 
is the most modest amendment that has been offered on predatory lending 
on this bill. It does not involve the Banking Committee, no more so 
than any of the other amendments that deal with money and banks and 
credit cards because we solely amend the bankruptcy code, not RESPA or 
TILA or any of the other laws in the Banking Committee's jurisdiction.
  What it does is very simple: It deals with the kinds of situations 
that my good colleague, Senator Sarbanes, mentioned when he rose in 
support of the amendment: That the predatory lender sells knowingly to 
the secondary mortgagor and that mortgagor then says: There is nothing 
I can do. Even though I knew these were horrible loans that violated 
the law, I am immune from any claim.
  It is a simple amendment. It is a fair amendment. It is a humane 
amendment. I expect that this kind of amendment on its own should pass 
close to unanimously in this body. I don't know if it will. Based on 
the merits, it could hardly be fairer or any less controversial.
  I remind my colleagues that everyone who cares about this issue is 
watching this vote. It is a simple and fair one and seeks only to 
protect innocent consumers, American families, by whom we have each 
been elected.
  I thank the Chair and yield the floor.
  The PRESIDING OFFICER. Under the previous agreement, the Senator from 
Connecticut is recognized.


                            Amendment No. 75

  Mr. DODD. Mr. President, I send my amendment, No. 75, to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Connecticut [Mr. Dodd], for himself and 
     Mr. Kennedy, proposes an amendment numbered 75.

  Mr. DODD. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To amend the Truth in Lending Act with respect to extensions 
              of credit to consumers under the age of 21)

       At the end of Title XIII, add the following:

     SEC. 1311. EXTENSIONS OF CREDIT TO UNDERAGE CONSUMERS.

       (a) In General.--Section 127(c) of the Truth in Lending Act 
     (15 U.S.C. 1637(c)) is amended by adding at the end the 
     following:
       ``(8) Applications from underage consumers.--
       ``(A) Prohibition on issuance.--No credit card may be 
     issued to, or open end credit plan established on behalf of, 
     a consumer who has not attained the age of 21, unless the 
     consumer has submitted a written application to the card 
     issuer that meets the requirements of subparagraph (B).
       ``(B) Application requirements.--An application to open a 
     credit card account by an individual who has not attained the 
     age of 21 as of the date of submission of the application 
     shall require--
       ``(i) the signature of the parent, legal guardian, or 
     spouse of the consumer, or any other individual having a 
     means to repay debts incurred by the consumer in connection 
     with the account, indicating joint liability for debts 
     incurred by the consumer in connection with the account 
     before the consumer has attained the age of 21;
       ``(ii) submission by the consumer of financial information 
     indicating an independent means of repaying any obligation 
     arising from the proposed extension of credit in connection 
     with the account; or
       ``(iii) proof by the consumer that the consumer has 
     completed a credit counseling course of instruction by an 
     approved nonprofit budget and credit counseling agency that 
     meets the requirements of section 111 of title 11, United 
     States Code.''.
       (b) Regulatory Authority.--The Board of Governors of the 
     Federal Reserve System may issue such rules or publish such 
     model forms as it considers necessary to carry out section 
     127(c)(8) of the Truth in Lending Act, as amended by this 
     section.

       Amend the table of contents accordingly.

  Mr. DODD. Mr. President, I believe that most people, including most 
of my colleagues, will understand the purpose and intent behind this 
amendment. It attempts to inject a sense of responsibility not only 
among those who have received credit, which this legislation purports 
to accomplish, but it also asks those who are extending credit to 
assume some responsibility as well. That is truly what the underlying 
legislation fails to accomplish. In my view, the underlying legislation 
fails to recognize that while creditors will gain much from this 
legislation, while young people in our country, those under the age of 
21, remain unprotected

[[Page S2193]]

from the barrage of unsolicited credit card applications.
  I am not exaggerating when I tell you that the mere signature of a 
student and the presentation of an identification card, indicating they 
are a student at that institution, is all they need to sign up for 
$3,000, $5,000, $20,000 worth of credit.
  This amendment merely attempts to inject some responsibility into a 
process that is out of control in this country. I will show you in a 
moment the statistics which bear this claim out. This is not a small 
problem. It is a growing problem. We must demand that the credit card 
industry bear some responsibility before they go on college campuses 
and accept applications from these young people, enticing them with the 
offer of a free baseball cap, or a free T-shirt without anything more 
than a signature and an ID. This is the growing problem across our 
nation that this amendment attempts to address.
  Mr. President, I strongly support the purported goal of the 
underlying bill: to curb bankruptcy abuses. My fear is in our zeal to 
prevent abuses, we have cast the net too broadly, and snared some very 
honest and hard-working parents and young people.
  Of equal concern is that this legislation does little to focus on an 
issue of fundamental importance, and that is trying to help consumers 
avoid declaring bankruptcy in the first place. That ought to be our 
first line of defense: to minimize or offer a means by which people 
would not have to seek bankruptcy protection. There is precious little 
in this legislation, which is heavily slanted toward creditors, to 
provide consumers with the tools they need to understand the causes and 
effects of filing for bankruptcy protection.
  If those who incur debt must meet their responsibilities, so, too, 
must creditors who extend credit with no reasonable expectation that 
those debts will be repaid. My amendment simply requires that any 
credit card issuer, prior to granting credit to persons under the age 
of 21, obtain one of three things: That they have a co-signature by a 
parent, guardian, or other responsible party; or the applicant 
demonstrates an independent means of financial support for paying off 
the amount of credit that is offered; or the completion of a certified 
credit counseling course, which is currently outlined in the underlying 
legislation.
  This is not an onerous obligation. Federal laws in this country 
already put limitations on what people under the age of 21 can do. You 
can't drink alcohol anywhere in America if you are under age 21. The 
Tax Code makes the presumption that if someone is a full-time student 
under the age of 23, they are financially dependent on parents or 
guardians.
  I ask a simple rhetorical question, if you will: Is it so much to ask 
that credit card issuers find out if someone under the age of 21 is 
financially capable of paying back the debt? Or that their parents or 
guardians are willing to assume financial responsibility? Or if they 
don't want to meet either of those two conditions, that they understand 
the nature and conditions of the debt they are incurring?

  It is my understanding that there are responsible credit card issuers 
already requiring this information in one form or another. Is it too 
much to ask that the entire credit card industry strive to meet their 
own best practices when it comes to the most vulnerable in our society?

  Providing fair access to credit is something I have fought for 
throughout my entire tenure in the Senate. Credit cards can play a very 
valuable role in assisting millions of people to pursue the American 
dream. They have been a wonderful asset for millions of people.
  This amendment would not result in the denial of credit to worthy 
young people. However, it would help to protect financially 
unsophisticated young consumers from falling into a financial trap even 
before beginning their adult lives.
  Mr. President, I don't believe this amendment is unduly burdensome on 
the credit card industry, nor is it unfair to people under the age of 
21. It is the responsible thing to do. The fact is, these abusive 
creditors assume that if the young adult is unable to pay, they will be 
bailed out by their parents. Many times this means parents must 
sacrifice other things in order to make sure their child does not start 
out their adult life in a financial hole, with an ugly black mark on 
their credit history.
  By adopting this straightforward amendment, the Senate would send a 
very clear message to those aggressive credit card companies that we 
will no longer countenance their abusive behavior. This amendment 
corrects that behavior by making those overly aggressive credit card 
companies exercise their best judgment when it comes to the people who 
are obtaining their own credit cards for the very first time.
  Additionally, the legislation before us offers no protection for the 
most vulnerable in our society, who ironically are the primary targets 
of many credit card issuers--college students. This amendment, which I 
am offering with my friend and colleague from Massachusetts, is very 
simple. It makes a modest attempt to help educate young people, as well 
as help credit card issuers help themselves by making sure that those 
persons applying for credit cards have the reasonable ability to repay 
those debts, or that someone will cosign with them, or that they will 
take at least a course on understanding what their credit 
responsibilities would be.
  In the context of the bankruptcy debate, I think it is important to 
understand that an estimated 150,000 young Americans declared 
bankruptcy in the year 2000. I will repeat that. 150,000 young 
Americans, last year alone, filed for bankruptcy protection. That is a 
staggering number. According to Houston University professor, Robert 
Manning, the fastest growing group of bankruptcy filers are those 
people who are 25 years of age or younger.
  In fact, the number of bankruptcies among those under the age of 25 
is more than 6 times that of what it was 5 years ago. One of the most 
troubling developments in the hotly contested battle between the credit 
card issuers to sign up new customers has been the aggressive way in 
which they have targeted people under age 21, particularly on college 
campuses across America.
  Solicitations of this group have become more intense for a variety of 
reasons. First, it is one of the few market segments in which there are 
always new customers to go after. Every year, 25 to 30 percent of 
undergraduates are fresh faces entering their first year of college. It 
is also an age group in which brand loyalty can be established. In the 
words of one major credit card issuer, ``We are in the relationship 
business, and we want to build relationships early on.''
  Recent press stories have reported that people hold on to their first 
credit card for up to 15 years, but in my view, some credit card 
issuers have gone just too far. They irresponsibly, target the most 
vulnerable in society and extend large amounts of credit with 
absolutely no regard to whether or not there is a reasonable 
expectation of repayment.
  Although college students are one of the primary targets for credit 
card marketeers, they are not alone. One does not have to be in college 
to receive a credit card. In fact, one does not have to be old enough 
to read to qualify for one.
  I am sure there are people who may be listening to this debate who 
can offer their own anecdotes.
  I bring the attention of my colleagues a heartwarming story that was 
reported in the Rochester Democrat and Chronicle. The article relates 
the story of a 3-year-old child who received a platinum credit card 
with a credit limit of $5,000. Her mother filled in the application. I 
quote what she said:

       I would like a credit card to buy some toys, but I'm only 3 
     and my mommy says no.

  This child's credit line is greater than the number of days she has 
been alive. The pitfalls of giving 3-year-olds platinum credit cards is 
self-evident, and this is happening with increasing frequency.
  Let me take a moment to refocusing on the efforts of credit card 
companies on young people in our academic institutions. Credit card 
issuers are deeply involved in the business of enlisting colleges and 
universities to help promote their products. I find this shameful, and 
I hope they are listening: It is shameful what you are doing to these 
young people on your campuses.

[[Page S2194]]

  According to Professor Robert Manning, banks pay the largest 250 
universities nearly $1 billion annually for exclusive marketing rights 
to sell their credit cards on college campuses.
  Other colleges receive as much as 1 percent of all student charges 
from the credit card issuers in return for marketing or affinity 
agreements. Even those colleges that do not enter into such agreements 
are making money. Robert Bugai, the president of College Marketing 
Intelligence, told the American Banker that colleges charge up to $400 
per day for each credit card company that sets up a table on their 
campuses. That can run into tens of thousands of dollars by the end of 
just one semester.
  A recent ``60 Minutes II'' piece that ran a few weeks ago vividly 
illustrated the impact that credit card debt can have on college 
students. A crew from the show ``60 Minutes II'' went to a major public 
university campus in this country and, with the use of hidden cameras, 
filmed vendors pushing free T-shirts, hats, and other enticements with 
credit card applications: Just sign on the dotted line, show me your 
ID, and you get $5,000 to $10,000 worth of credit. That is all you 
need. A signature, an ID, you get a hat, a T-shirt, and you incur 
$5,000 worth of debt.
  ``60 Minutes II'' revealed that the university, a well-known 
university in this country, was being paid $13 million over 10 years by 
a credit card company for the right to have a presence on their campus 
and to use the university logo on its credit cards. This public 
university is actually making money off its students who use these 
cards. As part of the agreement, the university receives four-tenths of 
a percent of each purchase made with the cards. Unbelievable. This 
university has a vested interest in getting their students in as much 
debt as possible.

  We have a chance to do something about that. Look, if you are going 
to sign up a student under 21, and they do not have the independent 
means to repay, then a parent, guardian or other responsible party 
should co-sign or at least mandate that the student will take a course 
to understand what credit obligations are.
  If you are in the military, you have a paycheck. This amendment has 
no effect on persons who have a source of income. I am not referring to 
those people. I am talking about kids who have no independent means of 
financial support, who are being given these cards without any 
consideration for what it is going to do to them or their families.
  The ``60 minutes II'' piece also told the story of one student's 
circumstances, Sean Moyer. He made desperate attempts to handle the 
massive credit card debt he incurred. Sean Moyer's life began to spin 
out of control as a result of the huge debts racked up in 3 years in 
college. He could not get loans to go to law school like he dreamed. 
His parents could not afford to pay his way. So in 1998, Sean Moyer 
took his own life.
  ``It is obscene that the universities are making money off the 
suffering of their students,'' said Sean Moyer's mother. Sean Moyer had 
12 credit cards and more than $10,000 in debts when he committed 
suicide nearly 3 years ago. He had two jobs, one at the library and 
another as a security guard at a Holiday Inn, but he still could not 
pay his collectors.
  Three years after his son's death, his mother still gets pre-approved 
credit card offers in Sean's name from some of the same companies to 
whom he owed thousands of dollars. One company pre-approved Sean for a 
$100,000 credit line, according to his mother.
  Do not misunderstand me. People have to take responsibility for their 
actions. If you are going to apply for a credit card, you have to 
understand your responsibilities. All that I ask is that there be a 
commensurate responsibility on those soliciting these individuals. That 
is all I am asking for: some sense of balance in this bill.
  In the last Congress, I went to the main campus of the University of 
Connecticut in my home State to meet with student leaders about this 
issue. I was surprised at the amount of solicitations occurring at the 
student union at the University of Connecticut. I was surprised at the 
degree to which the students themselves were concerned about the 
constant barrage of offers they were receiving.
  The offers seemed very attractive. One student intern in my office 
received four solicitations in 2 weeks: One promised ``eight cheap 
flights while you still have 18 weeks of vacation.'' Another promised a 
platinum card with what appeared to be a low interest rate until you 
read the fine print that it applied only to balance transfers, not to 
the account overall.
  Only one of four, the Discover card, offered a brochure about credit 
terms, but in doing so also offered a spring break sweepstakes. In 
fact, last year the Chicago Tribune reported that the average college 
freshman will receive 50 solicitations during their first few months at 
college--50 solicitations from credit card companies. All you have to 
do is sign up and show your ID. You get five grand of credit. Is it too 
much to ask that the student show they can repay these debts? Or have 
an independent source of income? Or, in the absence of that, mom and 
dad or guardian are going will cosign the application? Or the student 
will complete a credit education course to understand what credit 
obligations are? It can be any one of these three options. That is all 
this amendment does.
  College students can get green-lighted for a line of credit that can 
reach more than $10,000 on a signature and an ID, according to the 
Chicago Tribune.
  There is a serious public policy question about whether people in 
this age bracket can be presumed to be able to make the sensible 
financial choices that are being forced on them from this barrage of 
marketing. It is very difficult to get reliable information from the 
credit card issuers about their marketing practices to people under the 
age of 21.
  However, the statistics that are available are deeply troubling. I 
refer to chart #2, titled ``Undergraduates pile on credit cards and 
debt.'' Nellie Mae, a major student loan provider in New England, 
conducted a recent survey of students who applied for student loans. It 
termed the results ``alarming''.
  The study found the following: 78 percent of all undergraduate 
students have at least one credit card. That is up in 2 years from 67 
percent to 78 percent. Of those students, the average credit card 
balance is $2,748. That is up from $1,879, 2 years ago.

  In 1998, 67 percent of these students with credit cards, and in 2 
years it jumped 11 percent. In the same 2-year period, the obligations 
have gone up nearly $1,000, with every indication that student credit 
card debt is on the rise. We can do something now or wait until the 
problem is more severe. Ten percent of the college students have over 
$7,000 in credit card debt; 32 percent of the undergraduates had four 
or more credit cards in the survey.
  Some college administrators are bucking the trend of using credit 
card issuers as a source of income. Some have become so concerned they 
have banned credit card companies from their campuses. I applaud them. 
Some have even gone so far as to ban credit card advertisements in the 
campus bookstores.
  Roger Witherspoon, the vice president of student development at John 
Jay College of Criminal Justice in New York, banned credit card 
solicitors, saying indebtedness was causing students to drop out. 
Middle-class parents can bail out their kids when this happens, but 
lower income parents can't.
  I don't completely agree with Mr. Witherspoon on that statement. I 
don't think middle-class parents can afford it, either. Middle-class 
parents trying to make ends meet can hardly assume this kind of burden. 
Only the most affluent of people can assume these obligations.
  Mr. Witherspoon also said, ``kids only find out later how much it 
messes up their lives.''
  An important component of this amendment is requiring credit 
counseling.
  Let me explain how this works. Much like we encourage our children 
who reach driving age to take driver's education courses to prevent 
automobile accidents, I think we should teach young people, young 
consumers, the basics of credit to avoid financial wrecks. Educating 
our Nation's youth about responsibilities of financial management is 
critical. Currently, we hardly do a very good job.
  There is overwhelming evidence student debt is skyrocketing. Most 
surveys also show the same group of consumers is woefully uninformed 
about

[[Page S2195]]

basic credit card terms and issues. According to the Jump Start 
Coalition for Personal Financial Literacy, a nonprofit group which 
conducts its annual national survey of high school seniors' knowledge 
of personal finance, financial skills are poorer today than 3 years 
ago.
  I will not go into all of the data they provided, but a startling 
number, well over a majority of students, have little or no 
understanding how credit works.
  Without any question in my mind, some credit counseling requirement 
is needed before you can sign on for the kind of debt being offered by 
the credit card issuers. The amendment I offer does not take any 
draconian action against the credit card industry.
  I agree with those who argue there are many millions of people under 
the age of 21 who hold full-time jobs, are deserving of credit. I also 
agree students should continue to have access to credit, that we should 
not try to prohibit the market from making credit available to them. 
Again, this amendment does nothing to affect these persons. However, 
you ought to be required to have more than just a student ID to qualify 
for credit. That is all that is currently required. I don't think 
asking for a co-signature, or proof that you have a job id too onerous. 
Barring the absence of those two qualifications, you need only take a 
course in credit responsibility.

  I think parents across the country would applaud the passage of this 
amendment. How many parents with kids who are currently in college are 
incurring more debt than they can afford. Are they perhaps affecting 
the ability of another sibling to go to school because of the debt they 
have accumulated? I think every mother and father in America would 
applaud a Senate that said: When you tighten the bankruptcy laws for 
debtors, make the credit card companies more responsible, too.
  This is a modest amendment. Can't we adopt this amendment, include 
this sort of simple proposal, to add some basic sense of responsibility 
for creditors? This bill should help families, not hurt them. If I have 
to choose between the credit card companies versus the parents, I 
believe that we should side with the parents. On this issue, parents 
should get our vote.
  I hope my colleagues, Republicans and Democrats, whatever else their 
views may be on this bill, will decide tonight, as parents and children 
gather around the dinner table, we will vote for this amendment, and 
cast a ballot tonight on behalf of families.
  Mr. HATCH. How much time remains?
  The PRESIDING OFFICER. The Senator from Utah has 20 minutes under his 
control; no time remains for the Senator from Connecticut.
  Mr. HATCH. Mr. President, I appreciate the feelings of my colleague 
from Connecticut. He is a good man.
  I think this is a discriminatory amendment which would unduly 
restrict access to credit cards for adults between the ages of 18 and 
21. It is a paternalistic amendment and some believe it is paternalism 
at its worst. It puts a complete prohibition on the issuance of a 
credit card to those adults unless, one, their parent, guardian, 
spouse, or someone else with means agrees in writing to joint liability 
for the debt; or, two, if a person submits proof of independent means 
of repayment; or, three, the consumer proves he has completed a credit 
counseling program.
  These hurdles, targeted at adults between the ages of 18 and 21, in 
our opinion, are not warranted. In short, adults between the ages of 18 
and 21 can vote, serve in the military, obtain a driver's license, and 
under longstanding law enter into legally binding contracts. 
Discriminating against them when it comes to obtaining credit cannot be 
justified.
  The unnecessary and burdensome requirements of making various 
paperwork submissions under this amendment will make the cost of credit 
more expensive for everybody and the process inefficient.
  Of course, this amendment strikes me also as ironic. Those who oppose 
parental consent for abortion for those under the age of 18 want 
parental consent for individuals over 18 to get credit cards. Something 
is wrong with that picture. That, it seems to me, is ironic.
  Finally, we have already had a 55-42 vote to table an amendment that 
attempted to restrict access to credit to adults between the ages of 18 
and 21. This amendment by the distinguished Senator from Connecticut is 
even more restrictive and unfair than that amendment.
  One last comment I have is this amendment is based on the myth 
younger borrowers are less responsible than older borrowers. The truth 
is that they are more responsible.

  As of 1999, 59 percent of all college students in America paid their 
balance in full at the end of each month compared to only 40 percent of 
the general population, And 86 percent of students pay their credit 
cards with their own money, not with their parents' money.
  Frankly, there is little or no reason to have this amendment. I know 
it is well intentioned, but just the costs alone would be passed on to 
every person in the country. Frankly, I think this amendment 
discriminates against young people between 18 and 21, the age of 
accountability in the eyes of most States, where they can legally enter 
into contracts. What are we going to do next, take away their rights to 
enter into contracts because we don't trust them or we don't think they 
are adult enough to be able to handle these matters?
  Again, I think this amendment is well intentioned, but these young 
people have all these obligations in life that they have to live up to, 
and they are living up to them. Yes, there are horror stories such as 
those the Senator has indicated, but I can give you horror stories 
among adults, too, 40, 50, 60 years of age who just didn't live up to 
the obligations to pay their debts.
  I think bankruptcy is a sorry thing for everybody. I wish nobody had 
to go into bankruptcy. But I will tell you one thing: To pass on 
additional costs and additional burdens to everybody else because there 
are some people who are irresponsible is not the right thing to do.
  Last but not least, under this bill, if they are under the average 
median income in their particular area, they will not have the 
obligation of going into the other chapter and having to try to pay 
back some part of these debts. I think society understands that.
  What we are trying to do is get people to be more responsible in this 
area. I think this bill will go a long way towards doing that. I 
appreciate my colleague, but I have to move to table this amendment. I 
am prepared to yield the remainder of my time.
  Does the Senator need any more time? I am prepared to yield the 
remainder of my time.
  Mr. DODD. If the Senator will yield 5 minutes of his time for one 
Member who would like to be heard on the amendment? I have no time.
  Mr. HATCH. I am happy to yield to the distinguished Senator from New 
York from my time, and then if I could have 1 minute after that.
  I yield 5 minutes to the distinguished Senator from New York.
  Mrs. CLINTON. Mr. President, I join in support of this amendment 
because we know, from a lot of the work that has been done over the 
last several years, many students are being deliberately solicited, 
even targeted, for credit cards before they are financially 
independent, responsible, or knowledgeable about what it is they are 
signing up for. Story after story has demonstrated clearly that this 
particular amendment by my good friend, the Senator from Connecticut, 
targets a real problem.
  I think all of us are committed to ensuring that people who are 
irresponsible with their financial affairs are held accountable. But I 
think we should look at our young people in a different category. It 
used to be no one could be held financially responsible when they were 
under 21. Then the age was dropped for many purposes to 18. But despite 
how quickly it seems our children grow up these days, there are many 
young people in college or out working who are not yet 21 who do not 
really have the experience to deal with the solicitations that come 
flooding through the mail and over the telephone that we know are 
targeting them with these credit card applications.
  This morning, I was talking with another colleague of ours who told 
me he was babysitting for his very young grandchildren. He put them to 
bed, the phone rang, and the person on the other end asked for one of 
his granddaughters. Our colleague said: What is

[[Page S2196]]

this about? He was told, much to his amazement, that his 5\1/2\-year-
old granddaughter had been approved for a new credit card. He said he 
was shocked this kind of activity was going on and did not really 
believe it until it happened in his own family.
  I urge our colleagues, regardless of the position we take on the 
underlying legislation, we should stand behind the basic principle that 
our young people should not be solicited, they should be given some 
better credit training as this amendment proposes, and there should be 
some sense of responsibility on the part of creditors before they reach 
out to entice our young people into these credit cards before they even 
know what it is they are signing up for. It looks all so easy, and they 
end up in trouble, with debts they cannot pay.
  Let's try to avoid that. That does not mean they cannot ever become 
customers, but let's make it a little more reasonable in the steps that 
have to be taken in order for them to qualify.
  I certainly urge passage of this amendment. I thank my good friend, 
the Senator from Utah, for yielding time.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I will just take a minute.
  I understand this amendment is well intentioned. Think about it. We 
are talking about taking away the rights of people who have to go to 
work, people who have a driver's license, people who can enter into 
legal contracts. That is paternalism at its worst.
  According to a national survey by the Educational Resources 
Institute, a majority of students use credit cards responsibly and do 
not accumulate large amounts of credit card debt. The majority of 
students, 59 percent, typically pay off their monthly balances right 
away. Of the 41 percent who carry over their balances each month, 81 
percent pay more than the minimum amount due. In addition, the 
overwhelming majority of students pay their own credit card bills. The 
14 percent of students who do not pay their own bills receive 
assistance mostly from parents or spouses.
  The average monthly balances reported by students also appear to be 
manageable. Eighty-two percent of students with credit cards who know 
their balance report average balances of $1,000 or less, and 9 percent 
have average balances between $1,001 and $2,000. In addition, slightly 
more than half of student credit card users report combined limits of 
$3,000 or less. All of these factors indicate the majority of students 
use credit cards responsibly.
  A significant portion of students with credit cards use them to pay 
for education-related expenses.
  This amendment is much more restrictive than the prior amendment by 
the distinguished Senator from California, which was voted down.
  I am prepared to yield back the remainder of my time, having said 
that.


                 Vote on Amendment No. 25, as modified

  On the Schumer amendment, I move to table and ask for the yeas and 
nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion to table amendment No. 25, 
as modified. The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  The result was announced--yeas 44, nays 55, as follows:

                      [Rollcall Vote No. 24 Leg.]

                                YEAS--44

     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Cochran
     Craig
     Crapo
     DeWine
     Domenici
     Enzi
     Frist
     Gramm
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Stevens
     Thomas
     Thompson
     Thurmond
     Voinovich

                                NAYS--55

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carnahan
     Carper
     Chafee
     Cleland
     Clinton
     Collins
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Ensign
     Feingold
     Feinstein
     Graham
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Specter
     Stabenow
     Torricelli
     Warner
     Wellstone
     Wyden

                        ANSWERED ``PRESENT''--1

       
     Fitzgerald
       
  The motion was rejected.
  Mr. HATCH. Mr. President, I move to reconsider the vote, and I move 
to lay that motion on the table.
  The motion to lay on the table was agreed to.


                 Vote On Amendment No. 25, as modified

  The PRESIDING OFFICER. The question occurs on amendment No. 25, as 
modified.
  Mr. HATCH. Mr. President, I ask unanimous consent that the yeas and 
nays be vitiated.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The question is on agreeing to the amendment.
  The amendment (No. 25), as modified, was agreed to.
  Mr. SARBANES. Mr. President, I move to reconsider the vote.
  Mr. HATCH. I move to lay that on the table.
  The motion to lay on the table was agreed to.


                        Vote on Amendment No. 75

  Mr. HATCH. Mr. President, I move to table the Dodd amendment and ask 
for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion to table the Dodd 
amendment.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  The PRESIDING OFFICER (Mr. Voinovich). Are there any other Senators 
in the Chamber desiring to vote?
  The result was announced--yeas 58, nays 41, as follows:

                      [Rollcall Vote No. 25 Leg.]

                               YEAS---58

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

                               NAYS---41

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

                        ANSWERED ``PRESENT''---1

       
     Fitzgerald
       
  The motion was agreed to.
  Mr. WYDEN. I move to reconsider the vote by which the amendment was 
agreed to.
  Mr. HATCH. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                            Amendment No. 78

  The PRESIDING OFFICER. Under the previous order the clerk will report 
the Wyden amendment.
  The legislative clerk read as follows:

       The Senator from Oregon [Mr. Wyden], for himself, Mr. 
     Baucus and Mrs. Murray, proposes an amendment numbered 78.

  Mr. WYDEN. Mr. President, I ask unanimous consent reading of the 
amendment be dispensed.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To provide for the nondischargeability of debts arising from 
                    the exchange of electric energy)

       After section 419, insert the following:

     SEC. 420. NONDISCHARGEABILITY OF DEBTS ARISING FROM THE 
                   EXCHANGE OF ELECTRIC ENERGY.

       (a) In General.--Section 1141(d) of title 11, United States 
     Code, as amended by this Act, is amended by adding at the end 
     the following:

[[Page S2197]]

       ``(6) The confirmation of a plan does not discharge a 
     debtor--
       ``(A) in the case of a debtor that is a corporation, from 
     any debt for wholesale electric power received that is 
     incurred by that debtor under an order issued by the 
     Secretary of Energy (or any amendment of or attachment to 
     that order) under section 202(c) of the Federal Power Act (16 
     U.S.C. 824a(c)) and requested by the California Independent 
     System Operator; or
       ``(B) in the case of debt owed to a Federal, State, or 
     local government agency named in an order referred to in 
     subparagraph (A) for wholesale electric power received by the 
     debtor except to the extent the rate charged for power traded 
     by the California Power Exchange delivered to the California 
     Independent System Operator is determined by the Federal 
     Energy Regulatory Commission to be unjust and immeasurable, 
     in which case this subpargraph should only apply to debt for 
     the actual cost of production and distribution of energy.''.
       (b) Automatic Stay.--Section 362(b) of title 11, United 
     States Code, as amended by this Act, is amended--
       (1) in paragraph (28), as added by section 907(d) of this 
     Act, by striking ``or'' at the end;
       (2) in paragraph (29), as added by section 1106 of this 
     Act, by striking the period at the end and inserting ``; 
     or''; and
       (3) by inserting after that paragraph (29) the following:
       ``(30) under subsection (a), of the commencement or 
     continuation, and conclusion to the entry of final judgment 
     or order, of a judicial, administrative, or other action or 
     proceeding for debts that are nondischargeable under section 
     1141(d)(6).''.
       (c) Technical and Conforming Amendments.--Section 1141(a) 
     of title 11, United States Code, is amended by striking 
     ``subsections (d)(2) and (d)(3) of this section'' and 
     inserting ``paragraphs (2), (3), and (6) of subsection (d)''.
       (d) Applicability.--This section and the amendments made by 
     this section shall apply with respect to any petition for 
     bankruptcy filed under title 11, United States Code, on or 
     after March 1, 2001.

  Mr. WYDEN. I offer this bipartisan amendment tonight on behalf of my 
colleague from Oregon, Senator Smith, from the Pacific Northwest. It 
was perfected in close consultation with Senator Boxer because of the 
importance of this matter to Senator Boxer's California constituents.
  As all of our colleagues know, during the California energy crisis a 
number of regions of this country have tried to assist. In the Pacific 
Northwest we believe we have been more than a good neighbor. Bonneville 
Power and other governmental agencies up and down the west coast have 
repeatedly shifted power to California to help out at critical times.
  Various California public officials have thanked profusely the 
Bonneville Power Administration and others for helping California avoid 
blackouts, help that was a real hardship for many in the Pacific 
Northwest because we have had a tough year, a low-water year. A variety 
of concerns were very much on the mind of those whom Senator Smith and 
I represent.
  To give an idea of how appreciative California public officials have 
been, I will read a letter Senator Feinstein wrote to Bonneville Power 
Administration recently.
  It reads:

       Dear Mr. Wright: I am writing to express my gratitude to 
     Bonneville Power Administration for selling power to 
     California yesterday.
       Yesterday my State nearly had an energy catastrophe. In a 
     meeting at my office yesterday to discuss California's energy 
     situation with Governor Davis, Secretary Richardson from the 
     Department of Energy, and Federal Energy Regulatory 
     Commission Chairman Hoecker, calls came into my office that 
     within the hour, a rolling blackout could hit California and 
     that the California Independent System Operator (ISO) would 
     not be able to purchase the power necessary to ``keep the 
     lights on.''
       Twelve energy generators, marketers and utilities, mostly 
     located outside of California, contacted the California ISO 
     yesterday and indicated their reluctance to sell electricity 
     into California without letters of credit from California's 
     investor owned utilities, who they feared would not be able 
     to pay for this power because of their economic 
     circumstances.
       I am very grateful for BPA's cooperation! THANK YOU!

  Mr. WYDEN. Mr. President, thank-you letters are certainly 
appreciated, but Bonneville Power still is in a position where they 
need to be repaid. As of now, Bonneville Power is owed more than $120 
million by California, and various other public entities such as the 
Western Area Power Administration and various municipal utilities up 
and down the west coast are also owed funds. The fact is that they do 
not have shareholders as do the big, private California utilities. The 
people we are speaking for in this amendment do not have any 
stockholders to absorb the costs if they are not paid what they are 
owed. The public entities that would get a fair shake under this 
amendment would have to pass the costs on directly to the consumers if 
they were not in fact repaid.
  Our amendment makes nondischargeable in bankruptcy any debts under 
the Department of Energy emergency orders or otherwise owed for 
electric power sent by Federal, State, or local governmental agencies. 
This means these debts would have to be paid in full unless there was a 
determination by the Federal Energy Regulatory Commission that the 
rates charged in California for electric power were unjust and 
unreasonable.
  I want to make it very clear, because we have seen a lot of letters 
passed around, exactly what Senator Smith and I are saying in this 
bipartisan amendment. All we are saying in this amendment is that if 
you are in a chapter 11 bankruptcy proceeding, you have to have a plan 
to pay the public back when the public has assisted you in these 
emergency situations.
  Let me repeat that. There is no preference given to anybody--nobody--
in this amendment. But it does say that instead of stiffing the people 
of the Pacific Northwest and some other public entities such as in the 
Western Power Administration that serves Montana and other areas, you 
have to have a plan in order to pay those folks back.
  Mrs. BOXER. Will my friend yield?
  Mr. WYDEN. I am happy to yield to my friend from California.
  I want to make clear to her we very much appreciate her being 
involved because this is so important to her constituents. We tried to 
perfect it so as to address her legitimate concerns.
  Mrs. BOXER. I thank my friend.
  Mr. LEAHY. Mr. President, if I may interrupt, I hope Senators who 
have amendments they want to bring down, and I hope they will because I 
think many of us would like to get some amendments that would be in a 
position to be voted on perhaps early tomorrow morning so we can start 
fairly quickly.
  As I said, we would have finished this bill last week had we not had 
ergonomics and other things interfering.
  Mr. WYDEN. I express again my appreciation to the Senator from 
California because we want to come up with something that will work for 
the whole west coast and not pit people against each other. I am happy 
to yield to the Senator at this time.
  Mrs. BOXER. Let me say to my friend, what I would like to do is state 
my understanding of the amendment by the two Senators from Oregon, and 
then ask my friend to comment if I am correct in my assumptions about 
this amendment.
  First, I appreciate the Senator's openness, working with me. The fact 
is I agree with my colleague; we on the west coast are going to have to 
work together. We need each other because there are some times when 
they will need power and we will have excess power. That may happen at 
some point. It has happened in the past. Certainly in this recent 
example we desperately need the power, and even though they had a hard 
time doing it, they came through for us. That is why we have thanked 
them. I say again a very big thank you on behalf of my constituency.
  As we all know, power is not a luxury item; you need it to live. If 
you are elderly and it is cold, you need it to stay warm. You need the 
lights. Certainly our jobs depend on electricity. So I do think the 
spirit with which my friends offer this amendment is not a spirit of 
anger but I think it is a spirit of fairness.
  I want to point out to my friend my understanding, and I hope when he 
comments on my remarks he will tell me if I am right, that there are 
12, as we have read it, public power entities in California which will 
benefit from his amendment. In other words, it is not only Bonneville 
but, in essence, what I understand the Senator is saying is if public 
utilities stepped in and helped us during this period, the 
utilities should pay their bills. I think it is fair. I don't think we 
can say thank you very much and then let them be there hanging, without 
getting paid.

  I think it also says if the private sector was forced to sell power 
in addition to the public sector during that crisis

[[Page S2198]]

period, in fact they will get paid, except they will not get paid back 
that portion that the FERC says was unfair and unreasonable.
  I really appreciate my friend including that language in his 
amendment because while I want to pay people a fair price, I do not 
think we should have to pay it if it is gouging. My friend was very 
quick to say he would, in fact, add that language.
  So my understanding is the purpose of this is to protect, in general, 
public utilities that are selling to California, to make sure they get 
paid; second, during that period of crisis, that any generator that was 
forced to sell, gets paid--except they do not get the part that may 
have been considered unjust and unreasonable charges.
  As I understand it, the public power entities that will benefit from 
this are: California Department of Water Resources, City of Anaheim, 
City of Azusa, City of Banning, City of Burbank, City of Glendale, City 
of Pasadena, City of Riverside, City of Vernon, Sacramento Municipal 
Utilities District, Silicon Valley Power, and Western Area Power 
Administration in Folsom.
  I have heard from these public utilities. They have told me, I say to 
my friend from Oregon, they are very frightened about not getting paid. 
While the big generators may be able to wait, these smaller public 
utilities really need this amendment so if the worst happens--and we 
certainly hope the worst will not happen--and there is a bankruptcy 
filing, these debts cannot be discharged.
  Let me just wrap it up in this fashion. I know there are 
disagreements. The Governor does not agree with my position on it, 
Senator Feinstein does not, others do. The fact of the matter is, I do 
not want to be known as a deadbeat State. California is too great to 
get that kind of reputation. I think what you are doing in this 
amendment is just assuring people that will not happen. I think it is 
important. It is the responsible way to proceed.

  Frankly, as I look at reports that show our private utilities--and 
this is a fact--taking some of the windfall that they got at the 
beginning of deregulation and giving it to parent companies and, 
therefore, shielding it, this is not a good thing. This isn't a fair 
thing.
  Why should a public utility that came to our rescue get punished 
because our private utilities took funds and essentially gave them over 
to a parent company? And now we cannot get at those funds.
  So on behalf of these public power entities in California that will 
benefit from this--and, frankly, in the name of fairness--I think the 
Wyden-Smith amendment is a fair amendment. I hope that it shows my 
friends that I do think we are in this together, that the west coast 
has to stick together.
  If this amendment is adopted--and I hope it is adopted--it is a 
signal that we are not saying, by virtue of this bill, that people can 
declare bankruptcy, utilities can declare bankruptcy, and run away from 
these bills they owe public utility companies and also some of the 
private generators during that period of the threatened brownouts.
  So I ask my colleague if he agrees with my interpretation of his 
amendment and for any other comments he might have.
  Mr. WYDEN. I think the Senator has stated it extremely well and put a 
very complicated, by anybody's calculation, and arcane subject into 
something resembling English. I really appreciate the Senator's 
explanation. I think the position the Senator has taken not only is 
correct, but it is very gutsy.
  We all know this is a divisive issue in many quarters. I want the 
public to know the reason we have nailed down the protection for those 
various public entities, such as those California municipalities, is 
because Senator Boxer stood up for them. I want it understood that 
those FERC provisions, again, in the name of fairness, came about 
because the Senator helped us put that language together. I think when 
one looks consistently at who is out on the floor of the Senate 
standing up for the consumer, the Senator has shown that again and 
again. I think the spirit the Senator has shown in working with us on 
this issue is exactly what it is going to take to bring folks together 
in the Senate and on the west coast to really address this issue in a 
comprehensive way for the long term.
  I thank the Senator and would be happy to yield to her for any other 
comments.
  Mrs. BOXER. I thank the Senator again. This is a long, drawn-out 
fight. I hope we can work together in the future.
  Mr. REID. Would the Senator from Oregon yield for a unanimous consent 
request?
  Mr. WYDEN. Absolutely.
  Mr. REID. This is a very difficult issue. A lot of people want to 
speak on it. I see a number of them on the floor this evening.
  Senator Carnahan, the junior Senator from Missouri, has been here, in 
and out, all day long. She has an amendment to offer. She has asked to 
speak on the amendment for 5 minutes. Then we would return the floor to 
the Senator from Oregon.

  I would ask those on the floor who are so concerned about this 
amendment offered by the Senator from Oregon to allow Senator Carnahan 
to proceed. I ask unanimous consent----
  Mr. WYDEN. Will the Senator yield?
  Mr. REID. Yes.
  Mr. WYDEN. Clearly, I think west coast Senators may not agree on 
everything debated tonight, but I think all of us can agree it is very 
appropriate that Senator Carnahan get 5 minutes at this point.
  Mr. REID. Mr. President, I ask unanimous consent that the pending 
amendment be set aside, that the Senator from Missouri be allowed to 
offer an amendment, and to speak on it for up to 5 minutes, and then 
the floor would be returned to the Senator from Oregon.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The PRESIDING OFFICER. The Senator from Missouri.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I just ask consent to speak for a moment 
before we go to the Senator from Missouri without it detracting from 
her time.
  I am also delighted to see the Senator from Missouri here to offer 
and speak on her amendment. I want to add to what the Senator from 
Nevada said. He did his usual courtesy in providing for all Members on 
our side. The Senator from Missouri has been on the floor waiting to 
speak more today than has the Senator from Vermont as one of the 
managers. So it is only appropriate she proceed now. I commend the 
Senator from Missouri.
  I yield the floor.
  The PRESIDING OFFICER. Without objection, the pending amendment is 
laid aside. The Senator from Missouri is recognized for up to 5 
minutes.


                            Amendment No. 40

  Mrs. CARNAHAN. Mr. President, I call up amendment No. 40.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Missouri [Mrs. Carnahan], for herself and 
     Ms. Collins, proposes an amendment numbered 40.

  Mrs. CARNAHAN. I ask unanimous consent reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

  (Purpose: To ensure additional expenses associated with home energy 
          costs are included in the debtor's monthly expenses)

       On page 10, between lines 17 and 18, insert the following:
       ``(V) In addition, if it is demonstrated that it is 
     reasonable and necessary, the debtor's monthly expenses may 
     also include an additional allowance for housing and 
     utilities, in excess of the allowance specified by the Local 
     Standards for housing and utilities issued by the 
     International Revenue Service, based on the actual expenses 
     for home energy costs, if the debtor provides documentation 
     of such expenses.

  Mrs. CARNAHAN. The purpose of the amendment that Senator Collins and 
I are offering is to make sure that extraordinary and unexpected 
expenses related to home energy costs are taken into consideration in 
the means test.
  Under the bill, monthly utility expenses are calculated based on the 
Internal Revenue Service standards. But these standards are only 
updated once a year from data based on the previous 12 months.
  These standards do not take into account the potential for dramatic 
increases in home energy costs. The

[[Page S2199]]

sharp rise in home energy costs this winter has put a tremendous strain 
on low- and middle-income Americans. People across Missouri and, 
indeed, across the country have experienced dramatic increases in their 
home energy costs. Therefore, I believe the potential for significant 
increases in home energy costs must be considered in the means test.
  Our amendment ensures that a debtor can include an additional 
allowance in his or her monthly expenses if the debtor can document a 
sharp rise in home energy costs. The bill already allows a debtor to 
include an additional allowance for food and clothing in excess of the 
IRS standard.
  The logic of this amendment is similar. It would allow bankruptcy 
judges to consider whether an additional allowance related to home 
energy costs is appropriate. But the amendment requires that an 
additional allowance is only permitted when it is reasonable and 
necessary, and when the debtor can provide documentation of the 
additional expenses.
  The added discretion provided by the amendment will enable bankruptcy 
judges to consider that families may be paying double or triple the 
price for heating their homes as they did when the IRS last calculated 
local energy costs.
  Our amendment will ensure that full bankruptcy relief is not denied 
to individuals and families because they have been saddled with 
extraordinary utility costs.
  Mr. President, I yield the floor.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I commend the Senator from Missouri for the 
amendment she has offered. As does the Senator from Missouri, I come 
from a State that has some very cold winters and a lot of snow. I know 
how important this issue is.
  Any of us who live, basically, in the frost belt know how an 
unusually severe winter, sometimes even an enormously severe winter, 
can push somebody over the brink into bankruptcy.
  I think the distinguished Senator from Missouri--I assume we will 
vote on her amendment tomorrow--has raised an extremely good point. I 
hope all Senators, whether they come from the northern-tier States or 
from more temperate States, will look at her amendment and support it. 
I applaud her for proposing it.
  I yield the floor.
  Mr. WYDEN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Mr. President, I will now resume consideration of the 
amendment I have offered with Senator Smith. I, too, want to praise 
Senator Carnahan for an excellent amendment. I am happy she spoke on it 
at this time.


                            Amendment No. 78

  Mr. President, just a couple of additional points. Again, I want to 
make it clear that nobody is going ahead of the line under this 
amendment that we have developed in close consultation with Senator 
Smith. I want to make it clear that all that happens is in chapter 11 
you have to have a plan to repay the public.
  In providing for this review by the FERC, we are not in any way 
subjecting the Bonneville Power Administration and public entities to 
rate review by FERC. Rather, it would have rates for power traded or 
delivered in California subject to FERC review, to examine if they are 
unjust and unreasonable.
  It was a very tough proposition for folks in the Pacific Northwest 
and elsewhere to send our power to California.
  It has been a tough year. At the bipartisan town meetings Senator 
Smith and I held earlier this year, again and again we heard from our 
constituents who were very irate--and understandably so--about being 
forced to send power to California. It doesn't seem to be fair--it is 
just not right--to say that all of those working families in the 
Pacific Northwest are going to be stiffed, that after thank-you letters 
have arrived, now somehow there could be a bankruptcy proceeding and 
the folks we represent just have to face the music and the extra cost.
  I urge my colleagues to prevent this unfair result by supporting the 
bipartisan amendment Senator Smith and I developed with Senator Boxer 
from California.
  I am happy to yield to my colleague from Oregon at this time.


                  Amendment No. 95 to Amendment No. 78

  Mr. SMITH of Oregon. Mr. President, I thank my colleague. I send a 
second-degree amendment to the desk and ask for its immediate 
consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Oregon [Mr. Smith], for himself and Mr. 
     Wyden, proposes an amendment numbered 95 to amendment No. 78.

  Mr. SMITH of Oregon. Mr. President, I ask unanimous consent that 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To provide for the nondischargeability of debts arising from 
                    the exchange of electric energy)

       Strike all after the first word and insert the following:

     420. NONDISCHARGEABILITY OF DEBTS ARISING FROM THE EXCHANGE 
                   OF ELECTRIC ENERGY.

       (a) In General.--Section 1141(d) of title 11, United States 
     Code, as amended by this Act, is amended by adding at the end 
     the following:
       ``(6) The confirmation of a plan does not discharge a 
     debtor--
       ``(A) in the case of a debtor that is a corporation, from 
     any debt for wholesale electric power received that is 
     incurred by that debtor under an order issued by the 
     Secretary of Energy (or any amendment of or attachment to 
     that order) under section 202(c) of the Federal Power Act (16 
     U.S.C. 824a(c)) and requested by the California Independent 
     System Operator; or
       ``(B) in the case of debt owed to a Federal, State, or 
     local government agency named in an order referred to in 
     subparagraph (A) for wholesale electric power received by the 
     debtor except to the extent the rate charged for power traded 
     by the California Power Exchange delivered to the California 
     Independent System Operator is determined by the Federal 
     Energy Regulatory Commission (Commission) to be unjust and 
     unreasonable in which case this subparagraph shall only apply 
     to the debt determined by the Commission to be just and 
     reasonable.''.
       (b) Automatic Stay.--Section 362(b) of title 11, United 
     States Code, as amended by this Act, is amended--
       (1) in paragraph (28), as added by section 907(d) of this 
     Act, by striking ``or'' at the end;
       (2) in paragraph (29), as added by section 1106 of this 
     Act, by striking the period at the end and inserting ``; 
     or''; and
       (3) by inserting after that paragraph (29) the following:
       ``(30) under subsection (a), of the commencement or 
     continuation, and conclusion to the entry of final judgment 
     or order, of a judicial, administrative, or other action or 
     proceeding for debts that are nondischargeable under section 
     1141(d)(6).''.
       (c) Applicability.--This section and the amendments made by 
     this section shall apply with respect to any petition for 
     bankruptcy filed under title 11 as amended by this bill, 
     United States Code, on or after March 7, 2001.

  Mr. SMITH of Oregon. Mr. President, my second-degree amendment is 
very similar to that of my colleague, Senator Wyden's. I have changed 
only the date of the applicability for bankruptcy filings to those that 
occur on or after March 7, 2001, and I have further clarified that just 
and reasonable debt owed will be paid to government agencies. I did 
this because it is important to recognize the efforts made by the State 
of California during the first week of March to begin to restore 
stability to the west coast energy market.
  On March 5, the Governor of California announced that the State 
department of water resources had signed 40 long-term contracts for 
electricity. Prior to this, the State had required the investor-owned 
utilities to purchase all their power on the spot market, making these 
utilities very vulnerable to short-term price spikes.
  While California is making some headway on restoring the 
creditworthiness of its utilities, it is imperative that the utilities 
in California not be able to export their bills to Oregonians and other 
Western States by seeking bankruptcy protection and avoiding repaying 
other power providers in the western United States for power that has 
literally kept the lights on in California in recent months.
  My constituents and energy-sensitive businesses in Oregon are already 
feeling the effects of the price volatility in the west. Utilities in 
the northwest are facing current rate increases of 11 to 50 percent.
  The customers of the Bonneville Power Administration are facing the 
prospect of 95 percent rate increases

[[Page S2200]]

beginning in October, when current contracts expire.
  Much of the media attention in recent months has focused on the cost 
and availability of electricity in California.
  But the West Coast energy market extends to eleven other western 
States, including Oregon, that are all interconnected by the high-
voltage transmission system.
  That's why avoiding bankruptcy for California's utilities is 
important for Oregon and other western states. From the middle of 
December until early February, western utilities were forced to sell 
their surplus power into California, with no guarantee of being paid.
  If the California utilities subsequently seek bankruptcy protection, 
it will be Oregonians who are stuck with the bill for California's 
failed restructuring effort.
  In fact, certain Oregon utilities are already receiving bills from 
California's power exchange for funds owed to the exchange by 
California utilities.
  Other utilities are being paid 60 cents on the dollar for sales they 
made as far back as last November.
  In addition, the Bonneville Power Administration is owed over $100 
million for power sales it made into California as long ago as November 
2000.
  I know that certain state officials have refused to consider raising 
retail rates in California, claiming the State has the highest rates in 
the Nation.
  However, let me point out just a few facts about California's energy 
use from publications by the U.S. Energy Information Administration:
  California ranks 50th in the Nation in the amount of electricity the 
state can generate on a per capita basis. In fact, total generation has 
decreased nearly 10 percent in the last 10 years, while total 
consumption has increased over 10 percent.
  In 1999, the average residential bill in California was actually 
$2.70 less than the average Oregonian's bill.
  In 1999, Californians actually paid 17 percent below the national 
average for their monthly electricity bills.
  Further, California consumers paid 32 percent less than consumers in 
Florida, $58.30 versus $86.34.
  To put a human face on what is happening in my State, let me tell you 
about a letter I recently received from a small school district in my 
State.
  Basically, they are pleading for the energy crisis to be fixed 
because, as a small school district, they are having to take resources 
away from students to pay energy bills. Their local utility has just 
added a 20 percent surcharge to the cost of electricity.
  The district also heats a number of its school buildings with natural 
gas. In November 1999, the bill was $4,383.59. By November 2000, the 
bill to heat the same buildings was $11,942.
  Another small school district in my State is concerned that its power 
bills may go up by $100,000. For them, that means laying off two 
teachers.
  Oregonians area already paying for California's failed experiment in 
electricity restructuring. It is exacerbated by one of the worst 
drought years on record in the Northwest.
  Our rates are going up, but we should not have to pay twice for 
California's mistakes by being stuck with the unpaid bills for being a 
good neighbor and helping California keep the lights on in recent 
months.
  I urge my colleagues to support my amendment to the Wyden amendment.
  I offer just a few concluding remarks. What Senator Wyden and I are 
trying to say to our friends and neighbors in California is that 
Oregonians are already paying once in the form of higher energy prices 
because of the situation created by California's law. If there is a 
bankruptcy, they will pay a second time because the Bonneville Power 
Administration, in order to make its treasury payments, will be forced 
to add $100 million or more to the rates charged to Oregon, 
northwestern customers. This is not right.
  We are simply saying, as kindly as we can, let's pay our bills. Let's 
be fair as neighbors.
  On a personal level, I can only understand how officials of the State 
government of California must look with horror upon the rate cap that 
is there that is not allowing price signals for conservation and 
production to be sent. In very real and human terms, this law has 
created something of a Frankenstein that is roaming the lands of the 
Western States and it is wreaking havoc upon jobs, communities, 
schools, and discretionary income. It isn't right. It isn't fair.
  I say to my friend from California: A regulated power market can 
work; a deregulated power market can work. One that is partially 
regulated and partly deregulated cannot work, as we are seeing to the 
lament of many people right now.
  Our hope, Senator Wyden's hope and mine, and others, is that we can 
simply say, as good neighbors, please fix this law. At the end of the 
day, if the ratepayers don't pay in California, the California 
taxpayers will pay because they are selling billions of dollars of 
bonds right now sucking up State surpluses that should be going to 
schools, should be going to streets, should be going to serve all kinds 
of human needs but instead are going to pay inflated power rates.
  At the end of the day, it is their issue, but it affects all of us. 
We want simply to say, with this amendment, please fix the law. Please 
pay this bill because we are in it together. We know that. We care 
about California being prosperous. Ultimately, the citizens of 
California will pay. They will pay as ratepayers or they will pay as 
taxpayers. It is, frankly, their choice. We don't want to be hung 
further with this obligation. We want to pay our bills.
  I thank my colleague.
  Mr. WYDEN. I thank my colleague. I will make a couple of additional 
arguments on my time. I know colleagues want to speak, and I certainly 
want to give them the opportunity.
  Today as we listen to this discussion, perhaps the central argument 
that has been advanced by some, that the amendment Senator Smith and I 
offer is unwise, is the argument that somehow what we are going to do 
is force California utilities into bankruptcy. I will take just a 
minute to say why I don't think that is the case and, in fact, why I 
think our legislation is an incentive to bring about the kinds of 
negotiations that everybody on the west coast would like to see.
  As our colleagues know, there is an effort underway in California to 
look at a comprehensive solution which presumably would involve 
repaying in full everyone who is owed money for sending power to 
California. That is about $12 billion in total. This amendment involves 
a few hundred million dollars owed under the emergency order plus debt 
owed to government agencies. The total, of course, is only a fraction 
of what is owed by California.
  The question that is central is, How is it possible that California 
can go out and work on a deal to pay $12 billion in full but ensuring 
repayment of several hundred million dollars, as Senator Smith and I 
are calling for, is going to force California utilities into 
bankruptcy?
  I want to come back to this one last point before yielding, regarding 
the effort that Senator Smith and I are pursuing. As I touched on 
earlier, this comprehensive approach to repaying those who are owed 
money under discussion in California involves about $12 billion in 
total. It just seemed to me to not be credible to say that California 
can work out a deal to pay $12 billion in full, but somehow ensuring 
repayment of several hundred million dollars is going to force the 
California utilities into bankruptcy.
  My view is that other creditors truly believe they are going to be 
fully repaid under this $12 billion comprehensive solution. They would 
not risk forcing California utilities into bankruptcy. Other creditors 
will only be concerned about our amendment if, in fact, they don't 
think there is enough money to pay everybody back.
  The amendment requires that Bonneville Power and other governmental 
agencies be repaid so that ratepayers and taxpayers don't end up 
holding the bag if these for-profit California utilities go into 
bankruptcy to avoid their debts. It does not--I repeat this--put these 
government agencies at the head of the line. It only keeps their 
current place in line to ensure that they would be repaid at some 
point.
  All of us in this discussion are hopeful that there is not going to 
be a bankruptcy proceeding. I am prepared to work as one Senator--and I 
know Senator Smith is as well--with our California colleagues to put in 
place a comprehensive agreement so that this amendment does not come 
into play.

[[Page S2201]]

  I see my colleague from the State of California on the floor. I want 
to repeat that again. I am prepared to work with her, as I sought to do 
for several weeks now, to make sure that California can have every 
opportunity to put in place a comprehensive agreement so that this 
particular amendment never comes into play. But if that doesn't happen, 
and if there is a bankruptcy filing, and there isn't enough money to 
pay back everybody, then it seems to me that the people's power--the 
power that belongs to these public entities deserves an opportunity to 
get a fair shake in a chapter 11 proceeding so that our constituents 
are not shellacked as part of an effort to be good neighbors.
  I yield the floor at this time.
  The PRESIDING OFFICER. The majority leader is recognized.
  Mr. LOTT. Mr. President, before I ask unanimous consent, it is 
obvious this has become a very partisan bill. We have people on both 
sides of the aisle on both sides of this issue. I guess we are making 
progress.
  I ask unanimous consent that any votes ordered for the remainder of 
the evening with respect to amendments to be offered from the list 
submitted last Thursday by the leadership be postponed on a case-by-
case basis until 10:30 a.m. on Wednesday.
  I further ask unanimous consent that there be 2 minutes prior to each 
vote for explanation, that the votes be in stacked sequence with the 
first vote limited to 15 minutes and all remaining votes in the 
sequence limited to 10 minutes.
  I further ask unanimous consent that, following those stacked votes, 
the Senate proceed to additional amendments and that the cloture vote 
be postponed to occur at 4 p.m. on Wednesday. Further, that just prior 
to the vote on cloture, Senator Wellstone be recognized to speak for up 
to 10 minutes.
  This has been discussed with the Democratic leader and cleared on 
both sides of the aisle.
  Mr. WYDEN. Reserving the right to object, just to ask the leader a 
question: Is it the leader's desire that this amendment be voted on 
tonight?
  Mr. LOTT. This amendment would be voted on, if a vote is required, at 
10:30 tomorrow morning in the stacked sequence.
  Mr. WYDEN. I withdraw my reservation.
  Mr. LOTT. I know there is a good deal of discussion that needs to go 
forward. I hope Senators on the floor will continue on this amendment 
and other amendments. Then, if votes are ordered, we would stack them.
  I believe there would be probably three amendments that would be 
offered tonight, and therefore we would have probably a minimum of 
three stacked votes tomorrow at 10:30.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LOTT. Therefore, there will be no further votes this evening. I 
thank my colleagues for their cooperation. I look forward to listening 
to the debate on this particular issue. It is very interesting. I will 
listen and decide how to vote as the night progresses.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Alaska is recognized.
  Mr. REID. Will the Senator from Alaska yield for some parliamentary 
business for a second without losing his right to the floor?
  Mr. MURKOWSKI. I am happy to do that.
  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. REID. Mr. President, I appreciate my friend yielding.
  This is a very interesting issue. A lot of people want to talk on it. 
we have a number of people who are going to be required to offer 
amendments sometime tonight. We want to have some idea. There are at 
least two Senators waiting to offer amendments.
  If I could ask my friend from Alaska, does he have a general idea how 
long he wishes to speak this evening?
  Mr. MURKOWSKI. The Senator from Alaska will probably speak not more 
than 10 minutes. I am just going to comment on the amendment and the 
second degree offered by my two colleagues.
  Mr. REID. How long does the Senator from Oregon wish to speak this 
evening?
  Mr. WYDEN. I think we will have some back and forth. But certainly 
the major points I have been interested in making have been made. I am 
happy to be sure that we are fair to all of our colleagues and that we 
move expeditiously.
  Mr. REID. I am not trying to cut back anybody's time. Does the 
Senator from California have an idea as to how much time she may take 
this evening?
  Mrs. FEINSTEIN. I appreciate the question. I believe very strongly 
about this amendment, and I believe it is going to have untoward 
consequences and act directly contrary to what the Senator from Oregon 
believes. I cannot give a precise time. I have been here all day. I 
have done nothing else. I would like to have a chance to make the 
arguments against the amendment following the comments of the chairman 
of the Energy Committee.

  Mr. REID. Just for the sake of Senators waiting around, does the 
Senator believe it will take an hour, hour and a half, 2 minutes, 3 
minutes?
  Mrs. FEINSTEIN. Probably not more than an hour.
  Mr. REID. I thank the Senator from Alaska.
  Mr. MURKOWSKI. Mr. President, first of all, let me share with you my 
own observation, with respect to the amendment and the underlying 
amendment by the two Senators from Oregon, that it is understandable 
their wanting to protect their public power entity, and to ensure that 
it receives just payment for power provided, to which they are 
entitled. What concerns the Senator from Alaska, as chairman of the 
Energy and Natural Resources Committee, are the questions of whether 
this establishes a precedent, whether this addresses the issue the 
Senator from Oregon has assured us would not be a factor, and whether 
this might force the two utilities in question into bankruptcy, with 
the resulting chaos that is pretty hard to predict.
  What effect would it have on the California teachers' retirement fund 
which is invested in these utilities in the State of California? What 
effect might it have on the State employees' retirement? We don't know 
the answers to these questions. But there is a reasonable suggestion by 
knowledgeable people that this amendment may force a chapter 7 
bankruptcy by these utilities. We all know what a chapter 7 is. It 
requires the utility to liquidate its assets and then the creditors 
stand wherever they stand.
  Now to determine the intent of the amendment by the Senator from 
Oregon it is necessary to consider what the amendment says--it says the 
confirmation of a plan does not discharge a debtor. That means a 
bankruptcy judge cannot settle for 80 cents on the dollar, or even 50 
cents on the dollar. It implies that, indeed, full payment must be 
made. That is what it says.
  Now the question of the exceptions that go into section A of the 
amendment, and this covers the case of a debtor--that is, a 
corporation--from any debt for wholesale electric power received that 
is incurred by the debtor under an order issued by the Secretary of 
Energy. Recall that there was an order issued by President Clinton, and 
an order issued later by President George W. Bush, that required power-
generating companies to sell into the California system; and the 
assumption has been, well, since the Government ordered it, and if the 
utilities can't pay then there is a case against the Government.
  But it is rather curious, in examining that question, that was not a 
formal acceptance by the utilities. It was an understanding that they 
sell. So the question, legitimately, that counsel may ask is: Does this 
ensure that those power companies that sold into Pacific Gas and 
Electric and Southern California Edison have a case against the 
Government if indeed there is not some form of guarantee in that regard 
for repayment?
  The answer seems to be nobody knows yet whether those companies that 
generate power and sold to Pacific Gas and Electric can get paid from 
the Government on the basis of that order because of a lack of 
formality. That is something that is going to employ a lot of lawyers 
for a long period of time if it comes to that.

  Then it says in section (B) of the amendment: In the case of a debt 
owed to the Federal, State, or local government agency named in an 
order referred to in subparagraph (A).

[[Page S2202]]

  Except for certain exceptions, it includes that the discharge that is 
initiated in the first portion is confirmed; that a plan--that would be 
a plan submitted by a bankruptcy judge. The bankruptcy judge cannot 
discharge the debt.
  Let us be realistic. That just sets a criteria to ensure that 
Bonneville is repaid. California got Bonneville's power. Bonneville is 
entitled to repayment. What concerns me is what we are doing here and 
not knowing the implications of what we are doing.
  Let us look at the history of why the California investor-owned 
utilities are on the brink of bankruptcy. We found the State of 
California designed a deregulation competition program that was flawed 
from the start. Hindsight is twenty-twenty, but California ordered its 
utilities to sell the bulk of their generation, the nonnuclear and 
nonhydro generation assets. California also ordered its utilities to 
purchase power only from the spot market, preventing them from entering 
into contracts to protect consumers from wholesale price spikes.
  That was fine as long as there was a big spot market and there was a 
lot of competition, and the utilities could get very favorable rates, 
but that changed.
  Then California did something else. They also decided to prevent the 
passthrough of wholesale rates into retail rates, despite the fact that 
this is contrary to Federal law.
  I remind you California has received the power. Now they have to pay 
for it. The point was made, whether it be the California taxpayer or 
the California ratepayer, and they are the same, that somebody has to 
pay for this.
  My colleagues should understand that the California program applies 
only to investor-owned utilities. Rather curious, because we have both 
municipally-owned and investor-owned utilities in the same competitive 
market. The result is potentially economic disaster for California's 
investor-owned utilities.
  California's investor-owned utilities were required to purchase all 
of their on the spot market at high prices, and sell low on the State 
price-controlled retail market. You do not have to take Economics 101 
to know if you buy high and sell low where you end up. You end up where 
they are: straight in bankruptcy. That is the reality of this 
situation.
  Who is responsible? What is the solution? First, California has to 
act responsibly in that manner.
  On the supply side, California must get over its aversion to new 
powerplants and transmission lines because the problem in California is 
having the supply necessary to meet demand. The supply is not there; 
yet the demand is there and it is increasing.
  On the demand side, California simply has to recognize the realities 
and get over its unwillingness to pass through the wholesale costs. If 
the wholesale costs were passed through, we would not be having this 
debate. The utilities would not be on the brink of bankruptcy and 
Bonneville would have gotten paid.
  Blaming others, driving utilities to the brink of bankruptcy, having 
the State buy power, taking over transmission lines, seizing utility 
assets is not going to solve California's problem. It only prolongs the 
agony and makes a lot of lawyers rich.
  This reminds me of a recent survey which found that--this is 
evidently accurate--that two out of three people in California would 
rather have the lights go out than pay an increase in their rates. That 
is their choice, I guess, and if they continue to oppose powerplants 
and transmission lines some of them might get their wish.
  There is no question that California faces a serious problem. We are 
sympathetic. We want to help them. We have to help them. But we have to 
find a meaningful solution. A Band-Aid approach that creates perhaps 
even more serious problems is what concerns me about this amendment.
  It is not that the power suppliers the Senators from Oregon are 
concerned about are not entitled to payment. They are entitled to 
payment. They ought to be fighting for payment. Sometimes we throw the 
baby out with the bathwater, and I am not sure we know what we are 
doing here. This might force those utilities into bankruptcy, into 
chapter 7 where they simply take their assets and sell them off and you 
are a creditor like anybody else. I do not think that is what we want 
to happen, we want everybody to get paid.
  I am also concerned about the bond holders, the teachers' retirement 
funds that have been invested in Pacific Gas and Electric, and Southern 
California Edison. Do we have a responsibility to protect them? I do 
not suppose we have a direct responsibility, but we have an implied 
responsibility. Those people invested in those utilities for retirement 
in good faith, and we have a responsibility to know what we are doing.
  If this thing goes into bankruptcy, I just wonder if we have achieved 
the objective by protecting solely the merits of the PMA, in this case 
Bonneville.
  I can understand Bonneville wanting some assurance that they are 
going to get paid, but I am not so sure if they the utilities go into 
chapter 7 that they are going to be any better off than any other 
creditor. I wonder if that will not create a worse situation for the 
utilities, the customers in California, the Federal PMAs, and the 
entire west coast and Pacific Northwest.
  That is my concern, but I do respect and recognize the efforts of 
Senator Wyden and Senator Gordon Smith to try to address protections 
for their constituents. They are doing what they have every right to 
do.
  The fact is that California got their power and cannot seem to come 
up with a structure to pay for it. Make no mistake about it, this 
particular amendment does give preference under any interpretation to 
Bonneville, and it may set off other creditors. For example, and I ask 
my good friends from Oregon, what about the natural gas suppliers that 
have not been paid? The amendment does not address their particular 
situation, but it is similar to Bonneville. They have not gotten paid 
for their power.
  What about other electricity that came from out of state? What does 
that do to those folks? Are they going to come in with an amendment 
later and say that we took care of Bonneville to ensure Bonneville 
received 100-percent payment, so why shouldn't the natural gas 
transmission companies that also have not been paid be taken care of? 
That is a concern.
  I wish we could find another solution. Maybe the Senator from 
California can enlighten us a little bit about a legitimate way to 
provide the Senators from Oregon the assurance that their utilities are 
going to get paid somehow, as well as the other creditors.
  The worst possible thing would be to force into bankruptcy the 
utilities and have the State of California take over. I do not think 
Government does a very good job of running businesses, whether it is 
the utility business or any other business.
  I stand here as chairman concerned about the implications of this 
proposal; that it sets a precedent for other creditors who are going to 
want protection and an unknown. I wish we had spokespersons here from 
PG&E and Southern California Edison to tell us what the results of this 
are going to be, not only on the citizens of California, but the 
ability of Bonneville to get paid so they can receive consideration for 
what they have provided, and that is consideration in the sense of 
power.
  Mr. WYDEN. Will the Senator yield?
  Mr. MURKOWSKI. I yield without losing my right to the floor, and I am 
happy to respond to a question.
  Mr. WYDEN. I respond briefly to the point the Senator is making. It 
seems to me the Senator makes an interesting point and certainly raises 
some interesting legal questions.
  The scenario just described is what Senator Smith and I seek to 
prevent by keeping our amendment narrow, to involve government 
entities. In other words, if you were to broaden the scope of the 
amendment to all kinds of other parties, it seems to me the case would 
be more credible that perhaps you could have a scenario where you were 
driven into bankruptcy. That is why we kept it narrow. We believed 
keeping it narrow gave people an incentive to negotiate and increase 
the prospect that we wouldn't have this calamitous situation that the 
distinguished chairman of the committee is so correct to say would be 
bad for all.
  Mr. MURKOWSKI. Perhaps we could have some enlightenment. I hope my 
good friend from California can give an indication of what the two 
utilities at

[[Page S2203]]

issue think of this. The State of California and the ratepayers and/or 
consumers are prepared to meet this just obligation.
  I yield the floor.
  Mr. REID. Mr. President, I ask unanimous consent amendment No. 93, 
that is at the desk and has been filed by Senator Durbin, and amendment 
No. 94, filed by Senator Breaux, be called up and put in the ordinary 
course of amendments that are already pending.
  The PRESIDING OFFICER. Is there objection? The Senator from Alaska.
  Mr. MURKOWSKI. Mr. President, I would like to check with our 
leadership at this time. It is not my intention to object, but I would 
like to have a few moments to consider the request.
  Mr. REID. If I may say to my friend from Alaska, if there is a 
problem with it, let's go ahead and get it done. If there is a problem, 
I will be happy to join with him to go ahead and rescind the unanimous 
consent request.
  Mr. MURKOWSKI. I am very--I must object.
  The PRESIDING OFFICER. Objection is heard.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, I thank the distinguished Senator and 
Chairman of the Committee for his comments. He asked, what do the two 
utilities at issue think of this? I will respond and I will give the 
comment of Robert Glynn--the Chairman, President, and CEO of Pacific 
Gas and Electric. This is his company's position:

       PG&E is at a critical point in sensitive negotiations to 
     resolve an energy crisis that is affecting the Western United 
     States. Our creditors have been willing to forbear in the 
     interest of achieving a comprehensive solution that is fair 
     to all parties. This amendment would change the relationship 
     among creditors and could destabilize the fragile cooperation 
     that currently exists. It would be a terrible irony if 
     actions of the United States Government were responsible for 
     tipping this situation over the edge.

  That is the response of one of the major investor-owned utilities in 
the State of California.
  I have input from the other, Southern California Edison, and I will 
read from a letter by John Bryson, CEO of Southern California Edison:

       Unfortunately, the Wyden amendment undermines the solution 
     being crafted within the State. The Wyden amendment would 
     require that, in the event of bankruptcy, the power 
     generators who have made significant profits from this crisis 
     receive full payment before small businesses, banks and bond 
     holders. This is not fair to the other creditors.
       Furthermore, this amendment could trigger the bankruptcies 
     that everyone is trying to avoid. Other creditors will not 
     stand by and just watch as the amendment takes away their 
     rights.

  This is the reason I so strongly oppose this amendment. I don't 
believe the Senators who support this Wyden amendment have an 
understanding of what might happen. There is $13 billion of debt out 
there. It involves banks all over the United States. It involves high-
tech companies, it involves cities, it involves generators, it involves 
natural gas companies, it involves a wide range of debtors and 
creditors.
  Right now, the State of California has made considerable progress 
toward resolving this crisis. More than anything, the State needs some 
time to conclude those negotiations. If the State is able to conclude 
negotiations, this means that the debt could be paid to the utilities, 
and would help exactly the creditors that Senators Wyden and Smith want 
to help.
  At this point, the State doesn't need the Federal Government to step 
in and destroy the progress they have made. I have checked with 
bankruptcy attorneys, and I believe I am right. This amendment is 
unprecedented. Never before without a hearing has the Senate of the 
United States decided the pecking order of creditors and debtors for a 
potential bankruptcy of this size. This amendment rewrites the 
bankruptcy rules in favor of one set of creditors. It creates an 
enormous incentive, as the Chairman has just said, for other creditors 
to now push the utilities into bankruptcy before this amendment would 
be signed into law. It is like a run on the bank. So without a hearing, 
this amendment seeks to determine winners and losers.
  There is not a single debtor or creditor that I know that supports 
this amendment. Virtually all of them have opposed to this amendment. 
Even some of the people helped by the amendment are opposed. That 
includes the California Municipal Utilities Association, the City of 
Los Angeles, Duke, Enron, Calpine, and Williams who all oppose this 
amendment.
  Let me quote from some of the letters I have received. I begin with 
the Governor of the State of California.
       A critical component of the plan to resolve California's 
     energy challenge is the return of our utilities to financial 
     solvency. Our efforts have taken the form of painstaking 
     negotiations between the State and the utilities to stabilize 
     their financial condition. Any attempt to create a special 
     class of debtor under Federal bankruptcy laws, may have 
     serious repercussions to our efforts. Therefore, I am writing 
     to express my strong opposition to Senator Ron Wyden's 
     amendment to S. 420, the Bankruptcy Reform Act of 2001. Any 
     actions on the part of the United States Senate might very 
     well undermine all the progress we have made to this point in 
     our negotiations with the utilities. This is a very delicate 
     process and we urge the Senate to allow all parties in 
     California to continue their work together to solve this 
     crisis.

  Now from the Electric Power Supply Association, which is the electric 
generating companies together:

       This amendment seeks to give certain entities a favorable 
     status in the event that California utilities fall into 
     bankruptcy. Many companies have provided power to 
     California's consumers and EPSA, the Electrical Power Supply 
     Association, believes emphatically that all these entities 
     deserve to be fully and fairly compensated. However, it is 
     inappropriate for the Senate to try and create winners and 
     losers in this desperate situation. Rather than orderly 
     resolution, this legislation could lead to a premature 
     declaration of bankruptcy and the inevitable liquidation of 
     the California electric utilities assets in a legal free-for-
     all. We urge you to oppose the Wyden amendment.

  Let me read from a letter submitted by a big electric generator, 
Williams--a generator that has profited mightily from this situation:

       Williams is strongly opposed to any such proposal. In our 
     judgment, intervention by the Congress in the California 
     market in a way that picks winners and losers among similarly 
     situated parties will only precipitate a deepening of the 
     crisis. It will cripple ongoing efforts within the State to 
     resolve the crisis and trigger an outpouring of litigation 
     and legal maneuvering that would prolong the crisis, not 
     resolve it. Restoring financial solvency to the local 
     utilities is a critical element of any long-term solution to 
     the electricity problem in California. If those utilities are 
     forced into bankruptcy, the immediate result would be to 
     plunge everyone involved in the crisis into protracted, 
     uncertain, court proceedings. In our judgment, this proposed 
     legislation will only serve to precipitate that bankruptcy. I 
     fear the mere possibility that such an amendment might become 
     law will leave those involved little choice but to trigger 
     bankruptcy proceedings in order to protect their own 
     interests.

  Let me give you another generator's view, Calpine:

       Under Senator Wyden's amendment, many out-of-state power 
     producers, both public and private entities, would be made 
     whole under any eventual utility bankruptcy, while QF's, 
     forced to sell by virtue of contracts rather than a federal 
     emergency order, would likely be left with little or no 
     recourse. Some of the cleanest, most environmentally 
     desirable sources of energy would be severely disadvantaged 
     by this action.
       While on fairness grounds alone, we believe the Wyden 
     amendment should be defeated, perhaps more importantly, we 
     think the amendment would only worsen the California energy 
     crisis. Creditors have shown remarkable patience to date, 
     giving California state officials an opportunity to seek a 
     solution that avoids utility bankruptcy. This amendment, 
     however, could trigger an immediate bankruptcy filing in 
     order for the filing to precede enactment of the legislation.

  So you see, just by passing this, what we do is, to all the community 
out there that is owed money, we trigger their urge to move the 
companies into bankruptcy. That would be a huge mistake.
  This letter is signed by the vice president of the company.
  Mr. President, I would like to read from a statement by the Edison 
Electric Institute which, as I understand it, represents most electric 
utilities with the exception of Pacific Gas and Electric:

       I am writing to express our concerns regarding a proposed 
     amendment to S. 420, the ``Bankruptcy Reform Act of 2001'', 
     that may be offered by Senator Wyden for himself and Senators 
     Baucus and Murray. While there appear to have been several 
     iterations of that amendment, the thrust appears to favor 
     public power electricity suppliers in a utility bankruptcy 
     proceeding by providing that debts to them for electricity 
     are not dischargeable. The amendment also applies to debts 
     for wholesale electric power received pursuant to the 
     emergency order issued by

[[Page S2204]]

     the Secretary of Energy under section 202(c) of the Federal 
     Power Act. This amendment raises large public policy concerns 
     by affecting all utilities as well as those involved in 
     bankruptcy proceedings.
       First, it primarily advantages government-owned utilities 
     who already are uniquely able to sell power at rates which 
     are not subject to regulation by FERC. It makes no sense to 
     give a bankruptcy preference to the only generators whose 
     rates are unregu-
     lated. . . .
       This amendment would undermine efforts underway to address 
     the current electricity situation in California. All parties, 
     including the Governor, the utilities and creditors, are 
     trying to work out an agreement. Passage (as well as concern 
     about the possible passage) of this amendment could disrupt 
     these efforts and lead to immediate initiation of bankruptcy 
     proceedings.
  Mr. President, this is not me saying this. These are the major 
creditors and debtors in this situation, all of whom are saying that 
once you give preference to one, the others will trigger bankruptcy to 
protect their rights. And, in protecting their rights, it will push 
these utilities into bankruptcy because that is the only way they can 
do it.
  If you push these utilities into bankruptcy, I believe it is likely 
they will go into chapter 7--not 11 or 13, but 7, and, therefore, they 
will go out of business altogether. So it is a very dangerous thing to 
do.
  The surprising thing is we have this amendment on the floor, in view 
of the fact that virtually all of the major creditors and debtors 
oppose it because they know exactly what is going to happen.
  We also have unions. I would like to have printed in the Record the 
International Brotherhood of Electrical Workers' letter. They represent 
over 800,000 electrical workers, who also believe the effect this would 
have would be to trigger a bankruptcy.
  I ask unanimous consent these letters in their entirety be printed in 
the Record.
  There being no objection, the letters were ordered to be printed in 
the Record, as follows:

                                                          Calpine,


                              1200 18th Street, NW, Suite 850,

                                   Washington, DC, March 12, 2001.
     Hon. Dianne Feinstein,
     Hart Senate Office Building, Washington, DC.
       Dear Senator Feinstein: I am writing to urge your 
     opposition to an amendment that will be offered by Senator 
     Wyden to the bankruptcy legislation currently being 
     considered by the full Senate. It is my understanding that 
     Senator Wyden intends to offer an amendment that would ensure 
     that public power producers and others who sold power to 
     California under the Federal emergency order are made whole 
     in any bankruptcy proceeding, thus allowing these select 
     creditors to be treated preferentially.
       As you may know, most of Calpine's power plants in 
     California are ``qualifying facilities,'' commonly referred 
     to as QFs. QFs are cogeneration and renewable energy 
     facilities, all located in the state of California, which 
     provide power to the California utilities under contracts. 
     Despite the contractual obligations of the utilities, the QFs 
     have not been paid for several months and today over $1 
     billion is owed collectively to these in-state companies.
       Under Senator Wyden's amendment, many out-of-state power 
     producers, both public and private entities, would be made 
     whole under any eventual utility bankruptcy, while QFs, 
     forced to sell by virtue of contracts rather than a Federal 
     emergency order, would likely be left with little or no 
     recourse. Some of the cleanest, most environmentally 
     desirable sources of energy would be severely disadvantaged 
     by this action.
       While on fairness grounds alone, we believe the Wyden 
     amendment should be defeated, perhaps more importantly, we 
     think the amendment would only worsen the California energy 
     crisis. Creditors have shown remarkable patience to date, 
     giving California state officials an opportunity to seek a 
     solution that avoids utility bankruptcy. This amendment, 
     however, could trigger an immediate bankruptcy filing in 
     order for the filing to precede enactment of the legislation.
       I urge you to do everything possible to help your 
     colleagues understand the very negative consequences of this 
     amendment for clean, renewable sources of energy. Thank you 
     for your assistance and please let me know if I can provide 
     you with any additional information.
           Sincerely,
                                                  Jeanne Connelly,
     Vice President--Federal Relations.
                                  ____



                                    Edison Electric Institute,

                                   Washington, DC, March 13, 2001.
     Hon. Dianne Feinstein,
     U.S. Senate, Washington, DC.
       Dear Senator Feinstein: I am writing to express our 
     concerns regarding a proposed amendment to S. 420, the 
     ``Bankruptcy Reform Act of 2001'', that may be offered by 
     Senator Wyden for himself and Senators Baucus and Murray. 
     While there appear to have been several iterations of that 
     amendment, the thrust appears to favor public power 
     electricity suppliers in a utility bankruptcy proceeding by 
     providing that debts to them for electricity are not 
     dischargeable. The amendment also applies to debts for 
     wholesale electric power received pursuant to the emergency 
     order issued by the Secretary of Energy under section 202(c) 
     of the Federal Power Act. This amendment raises large public 
     policy concerns by affecting all utilities as well as those 
     involved in bankruptcy proceedings.
       First, it primarily advantages government-owned utilities 
     who already are uniquely able to sell power at rates which 
     are not subject to regulation by FERC. It makes no sense to 
     give a bankruptcy preference to the only generators whose 
     rates are unregulated.
       Second, the amendment appears to have little benefit for 
     generators which are not publicly-owned, even though their 
     rates are fully subject to FERC regulation. Many of these 
     suppliers sold into the California market voluntarily without 
     being compelled to by the DOE order and most of their sales 
     took place both before and after the DOE order was in effect. 
     Thus, most of their sales would not be covered.
       Third, the amendment would have long term impacts 
     increasing all utilities' cost of capital by downgrading the 
     protections afforded to lending institutions and investors. 
     Such institutions lent money to California utilities to allow 
     them to continue to provide service to consumers in 
     California despite the retail rate freeze. Legislating 
     reductions in a lender's and an investor's bankruptcy 
     protections may lead investors to increase the cost of 
     capital to all utilities to compensate for the added risk. 
     This would result in higher costs to all consumers. Since 
     significant amounts of new capital are needed to fund 
     necessary expansions of generation and transmission 
     facilities, this would have a negative impact on the entire 
     economy.
       Fourth, this amendment would undermine efforts underway to 
     address the current electricity situation in California. All 
     parties, including the Governor, the utilities and creditors, 
     are trying to work out an agreement. Passage (as well as 
     concern about the possible passage) of this amendment could 
     disrupt these efforts and lead to immediate initiation of 
     bankruptcy proceedings.
       Finally, this amendment would do nothing to solve the 
     underlying problem that retail rates in California are frozen 
     at a level far below the cost of wholesale power purchases. 
     It does nothing to provide for new supplies of electricity, 
     does nothing to clarify existing provisions of the bankruptcy 
     code which may limit the authority of a bankruptcy judge to 
     increase rates and in effect merely ``reshuffles the deck 
     chairs'' in the California electricity crisis.
       We urge you to vote against the amendment.
           Sincerely,
     Thomas R. Kuhn.
                                  ____

                                           The Williams Companies,


                                          One Williams Center,

                                  Tulsa, Oklahoma, March 12, 2001.
     Hon. Dianne Feinstein,
     U.S. Senate, 331 Hart Office Building, Washington, DC.
       Dear Senator Feinstein: I understand that Sen. Wyden may 
     offer an amendment to the bankruptcy legislation before the 
     Senate that would adversely affect the California electricity 
     situation. I understand this amendment would give 
     preferential standing in any bankruptcy proceeding to private 
     or public providers of electricity who were required to sell 
     power pursuant to the Department of Energy orders. That is an 
     illogical outcome when private providers within the state may 
     have provided electricity outside of the DOE order and other 
     creditors may be equally deserving of payment.
       Williams is strongly opposed to any such proposal. In our 
     judgement, intervention by Congress in the California market 
     in a way that picks winners and losers among similarly 
     situated parties will only precipitate a deepening of the 
     crisis. It will cripple ongoing efforts within the State to 
     resolve the crisis, and trigger an outpouring of litigation 
     and legal maneuvering that would prolong the crisis, not 
     resolve it.
       Williams is a national energy company who has been an 
     active participant in the California market. Williams 
     dispatches as much as 4,000 megawatts of power in the Los 
     Angeles region, although the amount available on any given 
     day may be less, depending on a variety of factors. This 
     represents about 40 percent of the independent generating 
     capacity in the Los Angeles area and about 9 percent of the 
     available in-state generation that is available to the 
     independent system operator.
       Restoring financial solvency to the local utilities is a 
     critical element of any long-term solution to the electricity 
     problem in California. If those utilities are forced into 
     bankruptcy the immediate result would be to plunge everyone 
     involved in the crisis into protracted, uncertain court 
     proceedings. In our judgement, this proposed legislation will 
     only serve to precipitate that bankruptcy. I fear the more 
     possibility that such an amendment might become law will 
     leave those involved little choice but to trigger bankruptcy 
     proceedings in order to protect their own interests.
       In our view, a far more constructive course is for those 
     involved to work in good faith to find a comprehensive 
     solution to the problem. Congressional encouragement of that

[[Page S2205]]

     approach would be welcome, but partial solutions, especially 
     those that would increase the probability of litigation, 
     should be rejected.
       At the end of the day, if recovery efforts do fail and 
     there is the unfortunate outcome of a bankruptcy of one or 
     more of the California utilities, then leaving the existing 
     provisions of law in place will produce the fairest outcome. 
     Adoption of this amendment would create subsets of rights 
     among similarly situated parties with unpredictable and quite 
     possibly inequitable results.
           Sincerely,
     Keith E. Bailey.
                                  ____

                                                             TURN,


                                   The Utility Reform Network,

                                San Francisco, CA, March 12, 2001.
     Re: Wyden-Baucus Amendments to S. 240--TURN Opposition
     Senator Diane Feinstein,
     U.S. Senate, Hart Senate Office Building, Washington, DC.
       Dear Senator Feinstein: This letter is written to express 
     TURN's opposition to the Wyden-Baucus Amendment to S. 420. 
     The amendment would give preferential treatment to wholesale 
     power generators, who sold electricity into California's 
     severely dysfunctional market. By making debt incurred by 
     utilities for wholesale purchase of electricity non-
     dischargeable in the event of utility bankruptcy, the 
     legislation would unfairly favor generators at the expense of 
     ratepayers. During the worst part of the energy crisis, 
     wholesale generators, both public and private, realized 
     windfall profits in California. There is no justification to 
     protect 100 percent of these profits at the expense of 
     ratepayers and other creditors. Even power that was 
     dispatched subject to a federal order was sold at prices way 
     in excess of the just and reasonable rates that are required 
     by federal law. Why should Federal legislators protect 
     windfall profits at the expense of other creditors who were 
     loaning money to the utilities to purchase power during the 
     same emergency?
       We are afraid that this kind of legislation will harmfully 
     impact whatever negotiations are happening at the state level 
     to strike a balance that would cause all players to make some 
     sort of sacrifice so that we can all move forward. Let the 
     bankruptcy laws remain status quo ante in order to allow the 
     settlement of all claims going forward. The Senate should not 
     modify laws that were in place during this period in order to 
     choose winners or losers in California's energy debacle. 
     Either there will be a settlement at the state level or the 
     utilities will be forced to bankruptcy. If bankruptcy is the 
     eventual solution, let the federal bankruptcy judge, applying 
     the laws that were in place during the crisis, resolve the 
     equities. Senate intervention at this point influences the 
     negotiating dynamics unfairly. Such intervention could 
     actually hasten bankruptcy if other creditors perceive an 
     advantage to forcing early involuntary bankruptcy. This could 
     happen if bankers or commercial paper holders believe they 
     have more opportunity to recover their losses by filing 
     before the effective date of any legislation that could 
     compromise their claims.
           Sincerely,
                                                      Nettie Hoge,
     Executive Director.
                                  ____



                                         Edison International,

                                                   March 12, 2001.
     Hon. Dianne Feinstein,
     U.S. Senate, Washington, DC.
       Dear Senator Feinstein: I am writing to you to express 
     Edison International's opposition to an amendment from Oregon 
     Senator Ron Wyden to the Bankruptcy Reform Act, S. 420.
       As you know, California and the western states have been 
     hard hit by an electricity shortage and dramatic price spikes 
     for the last eight months. Edison has incurred an 
     undercollection of nearly $5.5 billion procuring wholesale 
     power at prices that greatly exceed retail rates in 
     California. In mid-January, after we ran out of credit and 
     stopped payment on most of our outstanding debt, the state 
     stepped in to pick up the funding shortfall for daily power 
     purchases. The state has spent an additional $3 billion in 
     electricity purchases so far.
       At this moment, California Governor Gray Davis is trying to 
     craft a solution that will get the system working again. 
     Those who hold utility debt, including banks, pension funds, 
     municipalities, retirees and other bondholders, small 
     businesses and electricity generators, have been patient, 
     working with us to avert utility bankruptcy while the state 
     works to resolve these very difficult issues.
       Unfortunately, the Wyden amendment undermines the solution 
     being crafted within the state. The Wyden amendment would 
     require that, in the event of bankruptcy, the power 
     generators who have made significant profits from this crisis 
     receive full payment before small businesses, banks and 
     bondholders. This is not fair to the other creditors.
       Furthermore, this amendment could trigger the bankruptcies 
     that everyone is trying to avoid. Other creditors will not 
     stand by and just watch as the amendment takes away their 
     rights.
       It is Edison's sincerest hope that a comprehensive solution 
     will be crafted that will allow us to make our creditors 
     whole. The state is currently in the midst of delicate 
     negotiations with generators and utilities. The Wyden 
     amendment should not be allowed to disrupt this process, and 
     we thank you for your efforts to oppose it.
           Sincerely,
                                                   John E. Bryson,
     Chairman of the Board and Chief Executive Officer.
                                  ____



                                             PG&E Corporation,

                                 San Francisco, CA, March 8, 2001.
     Dianne Feinstein,
     U.S. Senate, 331 Hart Senate Office Building, Washington, DC.
       Dear Senator Feinstein: This letter addresses the proposed 
     Wyden amendment which would modify the relationship among 
     creditors in some bankruptcies. We are in opposition to this 
     amendment.
       PG&E is at a critical point in sensitive negotiations to 
     resolve an energy crisis that is affecting the Western United 
     States. Our creditors have been willing to forbear in the 
     interest of achieving a comprehensive solution that is fair 
     to all parties. This amendment would change the relationship 
     among creditors and could destabilize the fragile cooperation 
     that currently exists.
       It would be a terrible irony if actions of the United 
     States Government were responsible for tipping this situation 
     over the edge.
           Sincerely,
                                                  Robert D. Glynn,
     Chairman, Chief Executive Officer and President.
                                  ____



                            Electric Power Supply Association,

                                   Washington, DC, March 12, 2001.
     Hon. Dianne Feinstein,
     The Senate Committee on Energy and Natural Resources, Senate 
         Hart Office Building, Washington, DC.
       Dear Senator Feinstein: The Electric Power Supply 
     Association (EPSA) is the national trade group representing 
     competitive power suppliers, both developers of power 
     projects and marketers of electric energy. Our members are 
     active nationally and include many of the companies that 
     produce and market power for the California wholesale market. 
     Few have a greater stake in the orderly and effective 
     resolution of California's electricity crisis than these 
     companies.
       We are writing to express our deep concern and opposition 
     to an amendment that may be offered by Senator Ron Wyden to 
     the bankruptcy legislation now before the Senate. Our fear is 
     that this amendment could precipitate a financial crisis and 
     exacerbate the already precarious situation in the West.
       This amendment seeks to give certain entities a favorable 
     status in the event that California utilities fall into 
     bankruptcy. Many companies have provided power to 
     California's consumers and EPSA believes emphatically that 
     all these entities deserve to be fully and fairly 
     compensated. However, it is inappropriate for the Senate to 
     try and create winners and losers in this desperate 
     situation. Rather than orderly resolution, this legislation 
     could lead to a premature declaration of bankruptcy and the 
     inevitable liquidation of the California electric utilities' 
     assets in a legal free-for-all.
       We urge you to oppose the Wyden amendment. EPSA is prepared 
     to assist you in structuring a more effective remedy to the 
     energy and financial crisis in western wholesale electric 
     power markets.
           Sincerely,
                                                  Lynne H. Church,
     President.
                                  ____

                                                 Governors Office,


                                                State Capitol,

                                   Sacramento, CA, March 13, 2001.
     Hon. Dianne Feinstein,
     U.S. Senate, Washington, DC.
       Dear Diane: I want to express my sincere appreciation for 
     your efforts on behalf of California as we work to solve the 
     electricity challenge we inherited.
       We have taken immediate steps to build new power plants. 
     Not one major power plant was built during the 12 years 
     before I was elected. Starting in April, 1999, we have 
     approved 9 plants, with 6 plants under construction, and with 
     3 plants on-line by this summer. Moreover, under my emergency 
     authority, I acted to accelerate and incentive the 
     development of new generation, including distributed 
     generation and peaking facilities, with an aggressive but 
     attainable goal of putting 5000 MW of new power on-line this 
     summer, and another 5000 MW by the summer of 2002.
       Today, I announced a major energy conservation initiative, 
     the 20/20 Rebate Program, which will reward consumers with a 
     20 percent reduction in their summer 2001 electricity bill if 
     they reduce their use by 20 percent or greater. This program 
     will be the centerpiece of $800 million in energy 
     conservation programs including a $30 million public 
     education program which features conservation messages in 12 
     media markets throughout California. The state, itself, has 
     initiated electricity conservation programs which have 
     produced an average savings of 8 percent, increasing to over 
     20 percent of its use during stage 2 and 3 alerts.
       A critical component of the plan to resolve California's 
     energy challenge is the return of our utilities to financial 
     solvency. Our efforts have taken the form of painstaking 
     negotiations between the state and the utilities to stabilize 
     their financial condition. Any attempt to create a special 
     class of debtor under federal bankruptcy laws may have 
     serious repercussions to our efforts.
       Therefore, I am writing to express my strong opposition to 
     Senator Ron Wyden's amendment to S. 420, the Bankruptcy 
     Reform Act of 2001. Any actions on the part of the United 
     States Senate might very well

[[Page S2206]]

     undermine all the progress we have made to this point in our 
     negotiations with the utilities. This is a very delicate 
     process and we urge the Senate to allow all parties in 
     California to continue their work together to solve this 
     crisis.
           Sincerely,
     Gray Davis.
                                  ____



              International Brotherhood of Electrical Workers,

                                   Washington, DC, March 13, 2001.
     Hon. Daniel K. Akaka,
     U.S. Senate, SH-720 Senate Hart Office Building, Washington, 
         DC.
       Dear Senator Akaka: We understand the Senate will be voting 
     on an amendment to the Bankruptcy Reform Act (S. 240) today, 
     submitted by Oregon Senator Ron Wyden. The International 
     Brotherhood of Electrical Workers (IBEW) has a number of 
     concerns with this amendment and urges your opposition.
       The Wyden Amendment would make any debts incurred under a 
     federal order imposed during the power crisis in California 
     non-dischargeable in a bankruptcy proceeding. Inevitably, 
     power suppliers would be given preference above other 
     creditors, pushing workers' interests further down the 
     ladder. This looming threat also adds pressure to bargaining 
     efforts during contract negotiations, putting our members at 
     higher financial risk.
       It is understandable that public agencies who supplied 
     power during the crisis want guarantees for their ratepayers, 
     and should, at just and reasonable rates that cover the cost 
     of producing the power. However, privately owned suppliers 
     took part in predatory behavior during the spot market price 
     spikes, selling electricity at 1,000-3,000 percent profit 
     margins. Should these suppliers who inflated their power 
     prices be the priority in a bankruptcy proceeding? Should 
     small bondholders, workers, pension trust funds and other 
     creditors be left to pick up the crumbs?
       Governor Gray Davis is working tirelessly to resolve the 
     electricity deregulation disaster in California. We are 
     hoping the state's solution will avert utility bankruptcy and 
     protect workers who could lose their jobs if these delicate 
     negotiations are not successful. We believe the Wyden 
     Amendment could disrupt this fragile process.
       On behalf of over 800,000 IBEW members and their working 
     families, we urge you to ``OPPOSE'' The Wyden Amendment to S. 
     420.
           Sincerely,
     Edwin D. Hill,
       International President.
     Jerry J. O'Connor,
       International Secretary-Treasurer.

  Mrs. FEINSTEIN. Mr. President, there is also a consumer organization, 
one that I am familiar with because while I was Mayor of San Francisco 
I had occasion to work with them. This group is The Utility Reform 
Network. In their letter they state:

       We are afraid this kind of legislation will harmfully 
     impact whatever negotiations are happening at the State level 
     to strike a balance that would cause all players to make some 
     sort of sacrifice so we can all move forward.

  I have offered the testimony of the Governor of the State of 
California, who states that, yes, Senator Wyden's amendment would 
interfere with the negotiations that are going on today. The letter 
goes on to say:

       Let the bankruptcy laws remain status quo ante, in order to 
     allow the settlement of all claims going forward. The Senate 
     should not modify laws that were in place during this period, 
     in order to choose winners or losers in California's energy 
     debacle. Either there will be a settlement at the State level 
     or the utilities will be forced to bankruptcy.

  That is certainly correct.

       If bankruptcy is the eventual solution, let the Federal 
     bankruptcy judge, applying the laws that were in place during 
     the crisis, resolve the equities.

  I could not agree more, Mr. President.
  I mentioned that right now the State of California is working 
diligently to ensure the utilities can make their payments. The State 
is negotiating to purchase the transmission assets of both of the 
investor-owned utilities in the State. This will provide an infusion of 
revenue into the ailing utilities that will enable them to begin to 
repay their creditors. If this amendment should trigger a run on the 
bank and generators or banks or other creditors find the only way they 
can protect their rights is to force a bankruptcy, the State of 
California will not be able to complete its plan to buy these 
transmission assets and have the utilities pay their debts.
  I am very hopeful this situation will be resolved in short order. The 
State has already come to preliminary agreements, and these agreements 
will likely be finalized within the next few months. California's 
creditors are also hopeful that this process will improve the chances 
that they will ultimately be repaid for all the debt they have 
incurred.

  I believe the public entities will be repaid. However, let me just 
say that some in the Northwest have charged that Bonneville Power 
Administration (BPA) has been forced to drain Federal reservoirs to 
supply power to California. I want to correct the record because those 
charges are mistaken.
  In December 2000, when the Secretary of Energy, Bill Richardson, 
issued the emergency order to Western utilities to sell power to 
California, BPA helped, but it helped in a way that also benefits the 
Northwest. It was an energy capacity exchange. In other words, they 
helped California meet their peak loads. And California, by that 
agreement, sent twice the energy back, using their excess capacity at 
night. So that helped BPA keep more water in the reservoirs when BPA 
has stated they really needed it.
  I am not critical of Senators Wyden and Smith for trying to protect 
their State. But what I am saying is, I have read almost a dozen 
letters from debtors and creditors intimately involved in the 
negotiations, all of whom oppose this. They do so because they believe 
it may well trigger a bankruptcy.
  I have read from the utilities involved--Southern California Edison, 
Pacific Gas and Electric--who also say, wouldn't it be ironic if the 
Federal Government were inadvertently to trigger a bankruptcy?
  I say to you that to move an amendment such as this at the time of 
critical negotiations is a huge mistake. I, for one, do not want to be 
responsible should it truly trigger both of these large investor-owned 
utilities to go into bankruptcy.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Mr. President, I want to respond just for a few minutes to 
my colleague from California. I think she knows I admire her 
enormously. I think the Record will show the distinguished Senator from 
California and I agree on a vast majority of the issues that come 
before the Senate.
  What is troubling about the argument that is advanced before the 
Senate tonight is that after State officials in California botched the 
job of deregulation--by the way, this was not Senator Feinstein; 
Senator Feinstein did not do that, but State officials in California 
botched the job--now the message is, the public entities and those 
responsible to taxpayers are just supposed to trust folks in California 
to hope everything is going to work out. Given the hardship we are 
facing in the Pacific Northwest, that is just a little much to swallow; 
it is hard for this Senator to swallow, despite the fact that I have 
great respect for my colleague from California.
  I think tonight we have seen--certainly over the course of the last 
hour--that there is a sharp difference of opinion between California's 
two Senators on this matter. Senator Boxer worked with us in close 
consultation. She is in support of this amendment. She believes it is 
going to help bring folks together in the West for a comprehensive 
solution.
  I think what she is saying is she does not want her State to be a 
scofflaw. She does not want her State to, in effect, be a deadbeat in 
the course of this whole discussion as the State of California asks the 
distinguished new Senator from Virginia to be part of an effort--and 
myself and others--to come up with a comprehensive solution to this 
question.
  The distinguished Senator from California started her presentation by 
reading from some letters from private utilities in California and, in 
particular, focused on the fact that Southern California Edison is in 
opposition to this amendment.
  The fact is, the Washington Post noted this recently. Southern 
California Edison actually passed along nearly $5 billion in net income 
to its parent, Edison International, which used the money to pay 
dividends to its shareholders and to repurchase its own stock.
  So what you have is a private company, Edison International, that my 
colleague cites tonight as the reason the Senator from Virginia and 
other colleagues should vote against the bipartisan Smith-Wyden 
amendment because we are individuals who ought to be concerned about 
Southern California Edison first.

[[Page S2207]]

  I want Southern California Edison to get a fair shake. That is why we 
made very clear in our amendment that no one would get a preference if, 
in fact, you had the worst case scenario of an actual bankruptcy 
unfolding in the State of California. I just do not want Southern 
California Edison and a handful of these private interests to get a 
free ride. I do not know how it passes the smell test. I think this is 
why Senator Boxer agrees with us on this matter.
  How we can say to the people of the Pacific Northwest, who, in 
effect, got these glowing thank-you letters from Senator Feinstein, 
that somehow they are not going to be repaid, even though it involves 
only a few hundred million dollars, may not be a big deal to 
California, but it is a huge deal to the ratepayers in our area. We are 
concerned. We always have to make debt repayment to the Federal 
Government. These sums make a real difference.
  So I am very hopeful, as our colleagues overnight reflect on the 
debate that is being held on the floor of the Senate, that they will 
stand with Senator Smith, Senator Boxer, and myself rather than with 
Southern California Edison, which has been busy sending billions of 
dollars overseas, when all the rest of us on the west coast have been 
trying to figure out how to get through a very difficult situation.
  Mention was made of the fact that this amendment requires out-of-
State generators to be paid in full before other creditors are paid. 
Our amendment does no such thing. It does no such thing. It only deals 
with a fraction of the debt that is owed by California utilities. It 
only requires the debt be repaid at the end of a bankruptcy proceeding 
when a plan of reorganization is put in place. If the worst case 
scenario takes place, which we believe our legislation helps to avert, 
then we will have a measure of fairness in the consideration of how to 
handle that situation.
  Senator Feinstein also quoted from out-of-State generators. These are 
the companies that the Governor of California has called profiteers. 
Those are not my words; those are the words of the Governor of 
California.
  So I am sure my colleagues, by this point, are awfully confused about 
the back and forth. But I do think Senator Feinstein has framed the 
debate well. On one side are the interests of those directly 
responsible to taxpayers, those who have no shareholders, nobody who 
can absorb the cost, nobody who can be involved in some kind of 
sleight-of-hand arrangement where you can send billions of dollars 
overseas.
  The people who are supporting Senator Boxer, Senator Smith, and 
myself, and others, do not have those kinds of shareholders involved in 
those multibillion-dollar deals that were reported in the Washington 
Post.
  They are standing up for taxpayers. They are the ones who would be 
helped by this bipartisan amendment. It is very clear, on the basis of 
the letters that have been read in opposition, that on the other side 
are the interests of these private utilities.
  I ask unanimous consent that the Washington Post article outlining 
Southern California Edison's program to send $5 billion overseas be 
printed in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

               [From the Washington Post, Jan. 31, 2001]

California's Utility Sent Parent Firm $4.8 Billion--Audit Results Anger 
                            Consumer Groups

                  (By William Booth and Rene Sanchez)

       Los Angeles, Jan. 30--The first of several audits to be 
     released by the state regulators said that one of 
     California's two nearly bankrupt utilities, Southern 
     California Edison, legally passed along nearly $5 billion in 
     net income to its parent, Edison International, which used 
     the money to pay dividends to its shareholders and to 
     repurchase its own stock.
       The audit, released Monday night by the California Public 
     Utilities Commission, also showed that Southern California 
     Edison is now broke and so strapped for cash it cannot keep 
     buying electricity at rates higher than it can pass along to 
     consumers.
       the $4.8 billion was, in part, proceeds from the sale of 
     the Southern California Edison's power plants, which the 
     utility was required to sell under California's 1996 
     deregulation plan. Deregulation here sought to break up the 
     utility monopolies and open the state up to free-market 
     forces.
       Consumer advocates--and some elected officials--reacted 
     angrily to the audit, accusing the utilities of pleading 
     poverty and begging for financial assistance from the state 
     to avoid bankruptcy.
       ``Basically, they took the money and ran,'' John Burton, a 
     Democratic leader of the state Senate from San Francisco, 
     told reporters. ``Had they not done that they would not be in 
     the financial problem they are in. If ratepayers bail them 
     out, ratepayers should get something in return, like power 
     lines or something.''
       But officials with the utilities said their critics are 
     playing politics and misinterpreting their books. Tom 
     Higgins, senior vice president at Edison International, said: 
     ``There's been no profit, no windfall. This is the recovery 
     of capital investment.''
       The past profits and current solvency of the state's two 
     struggling utilities are central to California's energy 
     crisis. Most experts agree that the state is suffering from 
     soaring prices and its 15th day of emergency energy rationing 
     because of a failed and dysfunctional deregulatory plan, 
     which allowed wholesale energy prices to soar while capping 
     the rates utility companies could charge consumers. In the 
     past six months, the utilities have gone bust, while 
     wholesale power producers have reaped huge profits.
       California is fast running out of time to solve its 
     immediate energy crisis. The state already has used up the 
     first $400 million in emergency appropriations for 
     electricity purchases. The Legislature is considering bills 
     to make the state a major buyer of power--and to pass along 
     possible steep increases in costs to consumers. Gov. Gray 
     Davis (D) worked through the weekend trying to hammer out a 
     longer-range plan, but so far the Legislature has passed only 
     emergency measures and decrees--and no long-term solutions.
       Higgins, the Edison International executive, said Southern 
     California Edison was required to sell off its plants after 
     deregulation in 1996, and that it did so--mostly to out-of-
     state companies that are now the wholesale suppliers of 
     California's electricity. The utility sold off its gas and 
     coal-fired plants, but retained its nuclear and hydroelectric 
     facilities.
       The money they got from plant sales, Higgins said, went to 
     pay off the banks that loaned them the cash to build the 
     generating stations and to repay investors and shareholders 
     who also put money into plant construction. The transfer of 
     money occurred from 1996 through last November.
       ``It's like you have a house and mortgage and you sell the 
     house and you recover your initial investment and then pay 
     off the mortgage,'' Higgins said.
       Another audit of Pacific Gas and Electric Co., the other 
     struggling utility, will be released within days. That 
     results are expected to be similar.
       ``The only reason this would be controversial is that the 
     consumer groups are trying to rewrite history,'' said John 
     Nelson, a spokesman for PG&E.
       Nelson said his utility did the same thing as Southern 
     California Edison--it sold plants, paid off loans and sent 
     the rest to its holding company, PG&E Corp. He would not 
     disclose exactly how much was transferred, but said it is 
     safe to assume a figure of several billion dollars.
       Consumer advocates around California, however, said it did 
     not matter that the utilities were returning investments to 
     their shareholders, a practice that no one has asserted is 
     financially improper or illegal. Today, they began lobbying 
     state lawmakers to scrap an emerging legislative plan that 
     would cover much of the utilities' purported debts with 
     billions of dollars in publicly financed bonds.
       ``This confirms what we've been saying all along,'' said 
     Matt Freedman, a director of the Utility Reform Network. 
     ``Edison is not being straight with the public or the 
     Legislature about the extent of its debt.''
       Freedman also said that the audit shows that in recent 
     months Edison has been selling some of its own generating 
     power back to itself at high prices on the open market, then 
     claiming both profit and debt.
       ``It's like a laundering scheme,'' he said.
       Michael Shames of the Utility Consumers Action Network said 
     the audit could significantly influence the fastmoving 
     legislative debate on the state's energy crisis. He said that 
     while it was not illegal for the utilities to transfer money 
     to their parent companies, ``the question is, `Was it 
     prudent?' ''
       But Paul Hefner, a spokesman for Assembly Speaker Robert 
     Hertzberg (D), said there are no substantive new revelations 
     in the Edison audit and that the Legislature is proceeding 
     with a plan outlined last Friday that would cover much of the 
     utilities' debts in exchange for the state receiving warrants 
     to buy stock in the companies.
       ``I don't know that it changes the landscape at all,'' 
     Hefner said, referring to the audits. ``All along we've been 
     saying we're not going to do this and get nothing back. We're 
     driving as hard a bargain as we can.''

  Mr. WYDEN. On the other side of our amendment are exactly those kinds 
of interests, those kinds of powerful private interests. Various 
letters have been read into the Record tonight. Yes, those who oppose 
us are utilities that transferred billions of dollars to the 
shareholders and parent companies and, frankly, don't seem to think 
that there is anything wrong with doing that while stiffing Bonneville 
Power, the western power administration,

[[Page S2208]]

itty-bitty municipal utilities, and others.
  The reason we have been able to put this bipartisan amendment 
together is that we have fashioned a narrow approach to ensure that 
these public entities get a fair shake. We have fashioned an approach 
that is not going to put in peril a comprehensive effort in the State 
of California to deal with this power situation. In fact, we believe 
that it will create incentives to actually bring parties together and 
to avert the kind of doomsday scenario that all of us in the Senate 
want to prevent.
  The lines are drawn very well. On one side you have Senator Smith and 
Senator Boxer and myself, and on the other side you have Southern 
California Edison and those representing a handful of multibillion-
dollar private interests that were intimately involved in creating this 
problem in the first place.
  I don't think the Senate ought to be asked, in effect by those who 
botched the job at the State level several years ago, to just trust 
them. We ought to take a practical step such as this that is going to 
bring the parties together.
  Senator Feinstein said: Well, this is without precedent. The fact is, 
the botched job that California did on energy deregulation is what is 
without precedent. If we are going to talk about setting precedents 
this evening, what we ought to talk about is the fact that in the State 
of Virginia they didn't go about the task of deregulating energy this 
way. Certainly, we didn't do it that way in my State. We believe in 
markets. We don't believe in saying, well, you can do one thing for 
wholesale and another thing for retail, but if everything doesn't work 
out, come to the Senate and if somebody tries to make sure you get a 
fair shake when you are sending power under Federal order, we will 
fight it.
  We don't say things such as that. We say you have to be fair to all 
parties. That is why I am particularly pleased to have the support of 
Senator Smith and Senator Boxer.
  Mr. REID. Mr. President, I ask unanimous consent that the votes occur 
with respect to the Carnahan amendment No. 40 and the Smith of Oregon 
amendment No. 95, and the Wyden amendment No. 78, as amended, if 
amended, and the Wellstone amendment No. 36, as modified, at no later 
than 10:40 a.m. and that at 10:30 a.m. on Wednesday, Senator Wellstone 
be recognized for up to 10 minutes to be followed by the stacked votes 
as provided in the earlier agreement.
  I further ask unanimous consent that Senator Bingaman, prior to the 
vote on the Wyden amendment, be recognized himself for 10 minutes.
  Mr. WYDEN. Reserving the right to object for the purpose of asking my 
colleague a question, I want to make sure I understand my colleague. 
The first vote on the amendment involving this matter with Pacific 
Northwest and California would be on the Smith of Oregon perfecting 
amendment; is that correct?
  Mr. REID. The Senator is correct.
  Mr. WYDEN. I appreciate that.
  Mr. GRASSLEY. Reserving the right to object----
  Mr. REID. If I could say to my friend, it was just brought to my 
attention that there could be some parliamentary move, for example, to 
table the Smith amendment and that, of course, would not be in keeping 
with what the Senator just said. The intent is to have a vote on or in 
relation to the Smith amendment first. That would be the regular order.
  Mr. WYDEN. I did not understand the comments of my distinguished 
colleague.
  Mr. REID. In relation to the question asked by the Senator from 
Oregon, the Smith amendment is the first amendment that will be called 
up. Someone could move to table that amendment. I am sure the Senator 
understood that.
  Mr. WYDEN. I understand that.
  Mr. REID. We will vote on or in relation to the Smith amendment 
first.
  Mr. WYDEN. I thank my colleague.
  Mr. GRASSLEY. Reserving the right to object, we have an objection to 
part of this on our side, that the Wellstone amendment not be taken up 
because we don't have the modification yet.
  Mr. REID. I say to my friend from Iowa, the modification has been 
prepared. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the votes 
occur with respect to the Carnahan amendment, No. 40, and the Smith of 
Oregon amendment, No. 95, and the Wyden amendment, No. 78, as amended, 
at approximately 10:45 a.m. on Wednesday, and that following the votes, 
the Senate resume consideration of the Wellstone amendment, No. 36.
  I further ask consent that at 10:30 a.m. Senator Bingaman be 
recognized for up to 10 minutes for debate and Senator Hagel be 
recognized to speak for up to 5 minutes.
  I further ask consent that no second-degree amendments be in order to 
any of the above-listed amendments, where applicable, and there be up 
to 5 minutes prior to each vote for explanation.
  The PRESIDING OFFICER. Is there objection?
  Mr. REID. Reserving the right to object, Mr. President, this has been 
a long, arduous task. I appreciate the Senator from Oregon being so 
patient throughout the day. But there are two Senators who came here, 
Senators Durbin and Breaux, who have filed amendments in a timely 
fashion. There are 10 other amendments at the desk. Before I agree to 
this, I want these amendments just to be called up. It doesn't give 
them a right to vote or anything, except it is in the stack of these 
amendments.
  These two gentlemen were here tonight and waited. I told them I would 
offer the amendments for them. I ask unanimous consent that I be 
allowed to call those two amendments up, No. 93 and No. 94.
  The PRESIDING OFFICER. Is there objection to the request proposed by 
the Senator from Nevada?
  Without objection, it is so ordered.


                       Amendments Nos. 93 and 94

  The PRESIDING OFFICER. The clerk will report the amendments. The 
legislative clerk read as follows:

       The Senator from Nevada [Mr. Reid], for Mr. Durbin, 
     proposes an amendment numbered 93.
       The Senator from Nevada [Mr. Reid], for Mr. Breaux, for 
     himself, Mr. Specter, Mrs. Lincoln, Mr. Johnson, Ms. 
     Landrieu, Mr. Cleland, Mrs. Feinstein, and Mr. Nelson of 
     Nebraska, proposes an amendment numbered 94.

  The amendments are as follows:
  (The text of amendment No. 93 is printed in today's Record under 
``Amendments Submitted.'')


                            amendment no. 94

     (Purpose: To provide for the reissuance of a rule relating to 
                              ergonomics)

       At the appropriate place, insert the following:

     SEC. ____. AUTHORITY TO ISSUE A RULE RELATING TO ERGONOMICS.

       (a) Findings.--Congress makes the following findings:
       (1) The National Academy of Sciences issued a report 
     entitled ``Musculoskeletal Disorders and the Workplace--Low 
     Back and Upper Extremities'' on January 18, 2001. The report 
     was issued after the Occupational Safety and Health 
     Administration promulgated a final rule relating to 
     ergonomics (published at 65 Fed. Reg. 68261 (2000)).
       (2) According to the National Academy of Sciences, 
     musculoskeletal disorders of the low back and upper 
     extremities are an important and costly national health 
     problem. An estimated 1,000,000 workers each year lose time 
     from work as a result of work-related musculoskeletal 
     disorders.
       (3) Conservative estimates of the economic burden imposed 
     by work-related musculoskeletal disorders, as measured by 
     compensation costs, lost wages, and lost productivity, are 
     between $45,000,000,000 and $54,000,000,000 annually.
       (4) Congress enacted the Occupational Safety and Health Act 
     of 1970 (29 U.S.C. 651 et seq.) to ``assure so far as 
     possible every working man and woman in the Nation safe and 
     healthful working conditions,'' and charged the Secretary of 
     Labor with implementing the Act to accomplish this purpose.
       (5) Promulgation of a standard on workplace ergonomics is 
     needed to address a serious workplace safety and health 
     problem and to protect working men and women from work-
     related musculoskeletal disorders. Any workplace ergonomics 
     standard should take into account the cost and feasibility of 
     compliance with such requirements and the sound science of 
     the National Academy of Sciences report.
       (b) Authority To Issue Rule.--
       (1) In general.--Notwithstanding any other provision of 
     law, not later than 2 years after the date of enactment of 
     this Act, the

[[Page S2209]]

     Secretary of Labor shall, in accordance with section 6 of the 
     Occupational Safety and Health Act of 1970 (29 U.S.C. 655), 
     issue a final rule relating to ergonomics. The standard under 
     the final rule shall take effect not later than 90 days after 
     the date on which the rule is promulgated. The standard 
     shall--
       (A) address work-related musculoskeletal disorders and 
     workplace ergonomic hazards;
       (B) not apply to non-work-related musculoskeletal disorders 
     that occur outside the workplace or non-work-related 
     musculoskeletal disorders that are aggravated by work; and
       (C) set forth in clear terms--
       (i) the circumstances under which an employer is required 
     to take action to address ergonomic hazards;
       (ii) the measures required of an employer under the 
     standard; and
       (iii) the compliance obligations of an employer under the 
     standard.
       (2) Authorization.--Paragraph (1) shall be considered a 
     specific authorization by Congress in accordance with section 
     801(b)(2) of title 5, United States Code, with respect to the 
     issuance of a new ergonomic rule.
       (3) Prohibition.--In issuing a new rule under this 
     subsection, the Secretary of Labor shall ensure that nothing 
     in the rule expands the application of State workers' 
     compensation laws.
       (4) Standard setting authority.--Nothing in this subsection 
     shall be construed to restrict or alter the authority of the 
     Secretary of Labor under the Occupational Safety and Health 
     Act of 1970 (29 U.S.C. 651 et seq.) to adopt health or safety 
     standards (as defined in section 3(8) (29 U.S.C. 652(8)) of 
     such Act) for other hazards pursuant to section 6 (29 U.S.C. 
     655) of such Act.
       (5) Information and training materials.--The Secretary of 
     Labor shall, prior to the date on which the new rule under 
     this subsection becomes effective, develop information and 
     training materials, and implement an outreach program and 
     other initiatives, to provide compliance assistance to 
     employers and employees concerning the new rule and the 
     requirements under the rule.


                     Amendment No. 36, As Modified

  Mr. REID. Mr. President, the majority has received the modified 
Wellstone amendment. I ask that his amendment be modified at this time.
  The PRESIDING OFFICER. The amendment will be so modified.
  The amendment (No. 36), as modified, is as follows:

    (Purpose: To disallow certain claims and prohibit coercive debt 
                         collection practices)

       At the end of subtitle A of title II, add the following:

     SEC. 204. DISALLOWANCE OF CERTAIN CLAIMS.

       In General.--Section 502(b) of title 11, United States 
     Code, is amended--
       (1) in paragraph (8), by striking ``or'' at the end;
       (2) in paragraph (9), by striking the period at the end and 
     inserting ``; or''; and
       (3) by adding at the end of the following:
       ``(10) such claim arises from a transaction--
       ``(A) that is--
       ``(i) a consumer credit transaction;
       ``(ii) a transaction, for a fee--

       ``(I) in which the deposit of a personal check is deferred; 
     or
       ``(II) that consists of a credit and a right to a future 
     debit to a personal deposit account; or

       ``(iii) a transaction secured by a motor vehicle or the 
     title to a motor vehicle; and
       ``(B) in which the annual percentage rate (as determined in 
     accordance with section 107 of the Truth in Lending Act) 
     exceeds 100 percent.''.


                            Amendment No. 78

  The PRESIDING OFFICER. The Senator from Oregon is recognized.
  Mr. WYDEN. Mr. President, I reclaim my time briefly to make a few 
additional points on the matter of the California utilities and the 
Pacific Northwest getting repaid for the funds it sent California 
during their period of critical blackouts and other problems this 
winter.
  I agree completely with those Senators who have spoken tonight, that 
it is in everyone's interest to come up with an approach that avoids 
bankruptcy. I think that is an area of widespread agreement. Senator 
Smith and I repeatedly have said to Senator Feinstein and others who 
have had reservations about our approach that we would be open to a 
wide variety of avenues in order to make sure our constituents get a 
fair shake and are repaid.
  For example, I would be happy this evening, or at another appropriate 
time before the vote, to accept a perfecting amendment that would give 
California a reasonable period of time to perfect this comprehensive 
approach that they are pursuing in order to make sure everyone is paid 
off. I think that is very reasonable, and I want to make it clear that 
Senator Smith and I have talked about that in discussions with various 
utilities, and a couple that oppose it. We made it clear we are open to 
giving California a reasonable period of time to put their agreement 
together.
  But, in effect, what these California utilities have said is that it 
is basically our way or the highway. That just doesn't pass the smell 
test in the Pacific Northwest and with these public entities that are 
having so much difficulty paying their bills. I wish just a few of 
those thank-you letters we got from California public officials had 
been accompanied by checks because the fact is that all over the State 
we are getting and have gotten these letters from California public 
officials thanking us, and now tonight we are hearing that we will be 
repaid for our good deeds by being told that we can't even get a fair 
shake in a bankruptcy proceeding.
  So this is unprecedented, Mr. President. There is no question about 
that. I am happy to yield to my colleague in a second because she has 
said, correctly so, that this is an unprecedented situation. But what I 
believe is unprecedented is that after State officials have botched the 
job, they would have the hutzpah to say to my constituents, just trust 
us; we hope everything works out.
  I am happy to yield to my colleague from California.
  Mrs. FEINSTEIN. If I may say to the distinguished Senator from 
Oregon, the point I don't understand is why you feel you won't be paid, 
why you feel you have to move ahead with this when everyone involved 
believes that moving ahead with it precipitates them to take action to 
force a bankruptcy, and if a bankruptcy is forced, it is chapter 7, 
where the company is dissolved and no one gets paid. That is my problem 
with this. This is why I believe it is so counterproductive.
  Mr. WYDEN. I say to my colleague that we are being asked to trust the 
people who essentially botched the job. And I look at Southern 
California Edison--my distinguished colleague read something from the 
Southern California Edison, and I opened my Washington Post recently 
and learned that the Southern California Edison sent $5 billion 
overseas.
  I have great respect for my colleague from California. I don't think 
she would have put together what California did in the first place. 
Where we disagree is that I cannot come to the floor of the Senate 
tonight and say that because I am fond of my colleague from California, 
California can, in effect, declare bankruptcy and not pay its bills. 
The Senator's colleague from California, Senator Boxer, said--I think 
very eloquently--she thought it was just plain fair. That is the way I 
see it.
  I think you are going to have important legislation come before the 
committee involving rate caps and other approaches. I am going to be 
working closely with you on those kinds of issues, and Senator Smith is 
as well. But if we now get stiffed, and if we are now told we can't 
even stand in line in a chapter 11 bankruptcy proceeding under a plan, 
I don't think that passes the basic test of fairness.
  That is why we are here tonight. The Senator has framed the issue on 
her side--Southern California Edison and several of those significant 
private parties who were intimately involved in botching this job. On 
our side: Senator Boxer, Senator Smith, and a variety of public 
entities who believe that, coming out of the chapter 11 bankruptcy 
proceeding, you ought to have something--something--that says you are 
going to get repaid.
  I ask my colleague again tonight, if she were to offer a perfecting 
amendment to the one we discussed tonight saying we will give you a 
reasonable period of time to work out your plan, that is yet another 
olive branch which we have been trying to extend over the last couple 
of weeks that might allow the Senate to go forward and approve a 
measure of protection for my constituents while at the same time 
showing that I and other Westerners are going to bend over backwards to 
give you all a chance to put together your comprehensive approach.
  Mrs. FEINSTEIN. May I respond?
  Mr. WYDEN. Of course.
  Mrs. FEINSTEIN. I appreciate that. I appreciate the Senator from 
Oregon saying he may postpone his amendment to give the State of 
California a chance to go forward with its comprehensive remedies. We 
do have to wait and see.

[[Page S2210]]

  Mr. WYDEN. If I may reclaim my time, what I am saying is we will add 
language to the amendment that says the State of California would get a 
reasonable period of time to work out this comprehensive approach you 
have pushed for before any of this kicked in, before anything kicked in 
that would say the people of the Northwest at some point would get 
repaid.
  Senator Smith and I will go yet another mile to accommodate the 
constituents of the Senator from California and say let's pick a 
reasonable period of time. You all work to put together your agreement. 
We will work cooperatively with you, and if you accept that change, we 
can let the Senate go home before breakfast time tomorrow morning and 
let it get about its business.
  Mrs. FEINSTEIN. If I may respond to the offer of the Senator from 
Oregon, I will be happy to take a look at it. The problem I have with 
it is that it does not stop what I am concerned about, which is a run 
on the bank; that as soon as creditors find there is an amendment in 
the bankruptcy legislation which gives a preference to a certain class 
of creditors, they then have to exercise their right and ultimately the 
utility companies will be driven to bankruptcy.
  I did not enter this letter into the Record. The American Gas 
Association just put it the way it is. I do not know whether the time 
solution proposed by the Senator from Oregon solves this, but ``By 
creating a preferred class of creditors,'' which your amendment does, 
``in effect the nonpreferred creditors would initiate involuntary 
bankruptcy proceedings against the utility. As the preferred 
creditors''--those are your entities--``would in actuality control the 
bankruptcy proceedings through their status, in effect chapter 11 
reorganization would not be an option. Liquidation of assets through 
chapter 7 would result.''
  That is what I am trying to avoid. No matter what you do, you create 
this situation of preferred versus nonpreferred so the nonpreferred 
exert their rights now and throw the situation into bankruptcy.
  This is not me saying it, this is the president and CEO of the 
American Gas Association saying that is what would happen.
  I do not know whether a time delay solves that basic problem.
  Mr. WYDEN. If my colleague will let me reclaim my time, again, there 
is absolutely nothing in the four corners of this amendment that would 
give a preference to Bonneville Power and the other public entities 
involved. The fact is Bonneville and the other public entities would 
not get priority over claims of secured creditors, for example, because 
my colleague has been speaking about creditors and the utilities 
tonight, and Bonneville gets no preference.
  All we are saying is that coming out of bankruptcy, there has to be a 
plan to pay back government agencies. It does not say there has to be a 
plan to give the people of the Pacific Northwest first crack. It does 
not say there has to be a plan making Bonneville, again, a preferred 
creditor. It just says there must be a piece of paper that makes sure 
the people to whom you sent that thank-you letter, that really gracious 
thank-you letter where you thanked them in all capital letters--you 
said, ``Thank you, Pacific Northwest''--all we are saying is that at 
some point those people you said thank you to should have something 
that would indicate they are not going to get stiffed but will 
eventually get paid back.
  I hope overnight our staffs can work together on this point. You are 
right; we do have a philosophical difference, and it was expressed by 
Senator Boxer. Senator Boxer said she did not want the people of her 
State, good and caring people--my colleague knows I went to Stanford, 
so I know something about her State--she did not want the people of her 
State to be essentially scofflaws and not pay their bills.
  If I may engage my colleague briefly, I want to make clear that 
overnight we are anxious to work with you on, for example, the idea of 
giving you a reasonable period of time before this legislation would 
kick in, and perhaps my colleague has other ideas because over the last 
couple of weeks we have made it clear that we want to work with her on 
this.
  Senator Boxer made the point, and correctly so, that on the west 
coast ours is a power system that is interconnected. It is a grid that 
serves the people of the West. There is a tangible reason for us to 
work together.
  It does not create much confidence, nor build a lot of credibility, 
for us to come to the floor of the Senate and say: Southern California 
Edison, which sent $5 billion overseas is against what Senator Smith, 
Senator Boxer, and I want to do, and the people of the Pacific 
Northwest ought to trust them and others who botched the job in the 
first place to let it all work out.
  Mrs. FEINSTEIN. Will the Senator yield for a question?
  Mr. WYDEN. Of course.
  Mrs. FEINSTEIN. If you put a time date in this, why wouldn't that 
encourage certain creditors to beat that date and push into bankruptcy 
ahead of that deadline? This is what every bankruptcy attorney with 
whom I have talked--and I have it right here:

       The inclusion of an effective date may not reduce the 
     likelihood that non-covered creditors would rush the 
     bankruptcy process, but rather could heighten and accelerate 
     that risk because the affected parties will perceive a need 
     to beat the legislative clock while simultaneously trying to 
     amend the legislation.

  Mr. WYDEN. If my colleague will allow me to reclaim my time to 
respond, that is not my first choice. My first choice was what we did 
with Senator Boxer. Senator Boxer worked very closely with us to narrow 
this amendment. In order to make sure we had the best possible response 
with respect to this threat that there could be a great run on the 
banks and the institutions of California, we narrowed this so it 
involves a few hundred million dollars out of $12 billion. In fact, 
there is a little irony here. The sum of money we are talking about all 
told is less than the Senator's staff initially indicated they could go 
along with, but I gather Southern California Edison and some of these 
other folks do not happen to agree.

  Our first choice is to have a very narrow amendment to make sure the 
people whom California public officials have been thanking get a fair 
shake. It is only because we are anxious to explore other options with 
you that we thought giving you a reasonable period of time might be 
helpful.
  We are prepared to take the consequences of an up-or-down vote on the 
Smith amendment. The choices are clear: Southern California Edison is 
not with the Smith-Boxer-Wyden amendment. We have established that. It 
has been read in letters tonight.
  Those who are with us are these small public entities--the Western 
Power Authority, Bonneville Power, small municipal utilities in 
California. They are with us. It sets a very bad precedent to say those 
organizations that are responsible to taxpayers can be stiffed through 
the bankruptcy process.
  I admire greatly my colleague from California who is here in this 
discussion tonight. I make it clear we are prepared to stay until all 
hours of the night toiling on this matter because one issue we both 
agree on is this is of enormous interest to our constituents--those you 
represent in California, those I represent in the Pacific Northwest. We 
have our door open to work with the Senator on other approaches.
  If that doesn't work, the choice is clear for colleagues tomorrow 
morning at 10:30. Senator Smith, Senator Boxer, and I have an approach 
that is narrow and we think will promote negotiations to avoid a 
bankruptcy proceeding. On the other side is Southern California Edison 
and a crowd shipping billions of dollars overseas when they ought to do 
their homework to correct a botched job in energy deregulation on the 
west coast in California.
  If my colleague from California wants to go back and forth some more 
tonight, we can do that. I have, with Senator Boxer and Senator Smith, 
made the principal points on our side, and unless my colleague from 
California wants to engage in further discussion, we can yield back, 
but I can't yield my time until we have had a chance to respond to any 
arguments the Senator has.
  Mrs. FEINSTEIN. Mr. President, I will set the record straight. This 
is not just Southern California Edison or PG&E. There is virtually no 
creditor or

[[Page S2211]]

debtor that is in support of the Wyden amendment. Not even the 
Bonneville Power Administration has written a letter in support of this 
amendment. There is a reason why they are not in support of this 
amendment. Once you create a preferred class of creditors, you prompt 
the breaking of the dam and other creditors will force an involuntary 
bankruptcy.
  If that happens, it is the wrong chapter. It is chapter 7. It is 
disillusion. It means the utilities get out of the business of 
distributing power.
  This is why this amendment is so dangerous. If the Senator can show 
me some of these authorities that think this kind of change of 
bankruptcy law in the middle of what is an extraordinarily precarious 
situation is a good thing, I may relent.
  I have introduced about a dozen letters, not just from Southern 
California Edison but from creditors, big and small. One of the rumors 
on the street is that many of the renewable power generators--the wind 
and solar generating firms for example--are most concerned and would 
therefore press bankruptcy should this amendment pass.
  To get involved in the State's healing process is extraordinarily 
dangerous. That is my argument. I am not sure simply extending the time 
obviates the argument I am making. I have virtually every one of these 
letters that say in so many words, don't force them to exercise their 
rights to push these companies into bankruptcy. That is what this 
amendment does.
  I find it very hard when my distinguished colleague says it is just 
one utility advocating against his amendment. It is not. It is the big 
generators, the small generators, it is virtually everybody involved in 
this situation who says, let us try to work it out with the State. Let 
the State buy these transmission lines. That will inject billions to 
pay creditors.
  If you vitiate or abrogate it by creating a preferred class of 
creditor, you will encourage other creditors to push for bankruptcy. 
There are literary hundreds of creditors, huge banks, small banks.
  I understand the Senator is trying to do something for his State. I 
understand that. It is incomprehensible to me to think the Bonneville 
Power Administration isn't going to get paid back. I believe they will. 
I believe if you amend bankruptcy law to provide for it, you simply 
cause a reaction from the other creditors that I think can be 
devastating.

  That is the sum and substance of my argument. I have tried to 
indicate that with a large number of letters. I regret if anyone thinks 
this is just one utility advocating against this amendment. It is not. 
It is virtually the entire creditor community.
  Mr. WYDEN. Mr. President, again to set the record straight, when my 
colleague came to the floor tonight, the first thing she said was, what 
do the two private utilities affected by this think?
  That is clearly what this debate is all about in terms of those who 
are opposed. Yes, Southern California Edison and PG&E are opposed. The 
crowd who botched the job of energy deregulation, the State of 
California, is prepared to oppose something such as this. My colleague 
from California said this is a dangerous amendment. What is really 
dangerous is what California has already done to the American people 
because the fact is, what California has already done to the American 
people is put in a set of energy decisions that have great implications 
for the whole country, not just those in the West.
  The President of the Senate is from Nevada; I am from Oregon. It will 
have ripples all the way through our country. That is what California 
has already done.
  The crowd that has botched this and engaged in this conduct, by my 
calculation, is pretty close to political malpractice if you look at 
how they went about deregulating energy, deregulating only one part in 
one way, leaving another part alone. Now they come to the floor of the 
Senate and they say, trust us even though they have already been 
dickering about it for months and months; we are going to be able to 
put together a $12 billion comprehensive settlement. But you in the 
Pacific Northwest and the public entities that Senator Boxer talked 
about, despite the fact that these organizations involve just a few 
hundred million dollars as part of a $12 billion plan, trust us because 
everything will work out in the end.
  That is a bit too much to swallow. Tomorrow when we vote --and we are 
open to working with our colleague from California this evening--I hope 
the Senate will stand with Senator Smith, Senator Boxer, and myself. We 
are of the view that our amendment is about simple, basic fairness. 
Nobody is given a preference in bankruptcy under this legislation. In 
fact, no one in the course of this debate that has gone on now for 
several hours has once pointed to any language in the amendment that 
provides a preference to Bonneville or anyone else.
  I wrap up by way of saying I will assume my colleague from California 
misspoke. The Bonneville Power Administration is for this. We have been 
working with them constantly. The Northwest Power Planning Council is 
for this. Bonneville Power, for example, is faced with a situation 
where they will have to make debt repayment before long.
  They badly need this money. So this is about the small public 
entities in California that Senator Boxer spoke about. It is about the 
municipal energy entities all up and down the west coast. You bet 
southern California is against us on this. I hope my colleagues will 
stand with Senator Boxer and Senator Smith and I at 10:30.
  I will again invite my colleague to discuss this further. I will 
respond to any other arguments. Whenever she finishes, perhaps I can 
make my closing arguments and we can wrap this up.
  Would my colleague like me to yield to her?
  Mrs. FEINSTEIN. I would like to respond.
  Mr. WYDEN. Would you like me to yield or do you wish your own time?
  Mrs. FEINSTEIN. I don't believe there is a time agreement. If the 
Senator has concluded his remarks, I would like an opportunity to 
conclude mine.
  Mr. WYDEN. I have.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, a lot has been said tonight. Let me 
express what did happen.
  In 1996, the State of California passed a deregulation law. 
Republicans and Democrats voted for that law. A Republican Governor 
signed the law. The law was badly flawed. It essentially deregulated 
the wholesale end of power and kept regulated the retail end. That was 
a mistake.
  Additionally, it provided that 95 percent of the power of California 
would have to be bought on the spot or day-ahead market. It prevented 
the bilateral, long-term contracts which are a key part of the solution 
for California. And the flawed deregulation plan said that California 
had to buy power through something called a power exchange, which 
actually guaranteed a higher price for power. And the plan said that 
the utilities which had generation facilities would have to divest 
themselves of those generation facilities.
  The law was a gamble. It gambled that spot power would be cheaper to 
buy than the price of bilateral contracts. In fact, that was not the 
case. There was not enough power supply to meet the demand, so the spot 
power prices rose dramatically.
  I am one who strongly believes that you have to fix the marketplace; 
that you cannot deregulate on the wholesale end and not also deregulate 
on the retail end. Possible solutions include establishing a baseline 
rate, or realtime pricing, or tiered pricing, or something else. These 
possibilities would create an incentive for conservation and, in the 
long term, corrects the flawed power market.
  The remedies before the State are slightly different than the way I 
would have gone. It does not mean it is better or worse, but it is a 
different way. Up to this point, the State has spent $3.9 billion in 
buying power. The State of California is willing to authorize funds to 
buy the transmission lines to enable the utilities to then secure their 
debt.
  It is very easy to point fingers. It is very easy to castigate. It is 
very easy to call the State a lot of names. Nonetheless, I think the 
State should have the opportunity to work this situation out.
  There is the rub. This amendment does not basically allow that 
because either advertently or inadvertently, it

[[Page S2212]]

creates a situation to which others will respond by driving the utility 
companies to bankruptcy.
  Let there be no doubt--in my mind there is no doubt--that others will 
respond to this situation by pushing these companies into bankruptcy. 
If they have to go into bankruptcy, they are not going to go into 11 or 
13 to repay the debt. They are going to go into 7 to dissolve the debt 
and simply get out of the business of power distribution. So I am 
afraid that Senator Wyden, Senator Smith, and even my colleague from 
the State of California, Senator Boxer--I am afraid this is going to be 
counterproductive and it is going to produce something which can be 
devastating to everyone.

  If it were just me alone who said that, I would be too timid to stand 
up here and say that. I am joined by virtually all of the debtor and 
creditor community in saying it. I am even joined by some of the public 
utilities that Senator Wyden seeks to protect. The largest city in the 
State, Los Angeles, which produces its own power, does not support this 
because the city is worried about the same thing I am worried about.
  I say give the State the time. Senator Wyden and I do appreciate 
this--says, all right, we will work with you to create a time. I would 
like an opportunity to see if that is possible without launching the 
assault on bankruptcy that I am afraid will come out of the passage of 
the Wyden-Smith amendment.
  I represent the sixth largest economic power on Earth. If these 
utilities go into bankruptcy, as Senator Murkowski pointed out, it 
impacts hundreds of thousands of investors who have invested in the 
utilities, public retirement funds, other companies as well. It creates 
a situation which I think will have a major negative economic impact 
throughout the rest of the United States.
  If the State were not assiduously trying to work out this problem, I 
wouldn't feel so strongly. If there was nothing being done to solve the 
problem, I wouldn't feel so strongly. But two utilities have agreed 
with the State on terms to purchase the transmission lines. Therefore, 
when the remainder of that purchase is completed, there will be the 
money available to pay Bonneville, to pay the Western Power 
Association, to pay the cogenerators, to pay other generators, to pay 
the natural gas suppliers. And I hope in the securitization of the back 
debt, the banks, the large New York banks will also feel that the 
arrangements are in place to see that they will get paid back. 
Bankruptcy, I do not believe, will solve this problem.
  The degree to which this amendment would push these companies into 
bankruptcy, I think, is a gamble that is very unwise to take at this 
time.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Mr. President, I will be brief, but I want to just respond 
to several of the arguments made by my distinguished colleague. My 
colleague said, for example, that this is going to have real 
ramifications for the economic well-being of her State. The fact is, 
what the State of California has already done has already had a major 
economic impact on my State and on the people of the Pacific Northwest. 
Under very difficult circumstances we sent additional power to 
California which generated these glowing thank-you notes from my 
colleagues and various California public officials.
  So my colleague from California envisages some economic trouble in 
her State. We are already seeing it and it is compounded by the fact 
that we have been more than a good neighbor. What it is all about on 
the west coast, as my colleague from Nevada knows, is we have an 
interconnected power system. We have been more than a good neighbor, 
and we are suffering economic hardship as a result.
  My colleague also said that California is owed the opportunity. Those 
were her words: The State of California is owed the opportunity to work 
out this matter.
  There is no question in my mind that they should have the opportunity 
to work it out. But they should not get a free ride. They should have 
to be part of an effort, as Senator Boxer said this evening, to bring 
the parties together as we have sought to do with our very narrow 
amendment we offered this evening.
  Finally, my colleague says that somehow the amendment put together by 
Senator Smith and Senator Boxer and I, in her words, has launched an 
assault on the State of California.
  That is pretty incendiary oratory, in terms of this whole debate. 
But, again, I submit if there has been an assault that has been 
launched, it was what was done in the State of California. It was not 
something that came about because the Senators from Oregon, working 
with the Senator from California, tried to figure out a way to make 
sure there was a modest measure of protection for our constituents. It 
is not a proposal that moved Bonneville Power to the head of the line, 
not a proposal that gives our constituents a free ride, the way 
Southern California Edison seems to want, but something that ensures 
that we do get a fair shake.

  I am very hopeful my colleagues will see that there has been an 
effort on the part of the sponsors of this particular amendment. The 
first vote will be on the Smith amendment tomorrow morning at 10:30 or 
thereabouts. It is an amendment that was perfected by Senator Boxer so 
as to ensure that this would not create a greater opportunity for 
bankruptcy to take place.
  It was designed to make sure that the parties had a reason to 
negotiate. I fear that if this particular proposal goes down, this 
gives a green light to the private interests that are opposing this 
tonight, to know they basically got the votes on the floor of the 
Senate to work their will on any of these major issues.
  This is going to be a big vote, it seems to me. It is important for 
us in the Pacific Northwest. But for anybody who reads the Washington 
Post--and I put the article in the Record--the people who are opposing 
this amendment are folks who are sending billions of dollars overseas 
rather than trying to take care of business here at home.
  The lines are drawn with respect to who is with us and who is not. 
Those who are responsible to taxpayers and have to make Treasury 
payments in small California municipal utilities are with us. This is 
about one proposition, and one proposition only, and that is basic 
fairness for all concerned in dealing with a difficult issue.
  I urge my colleagues to vote in favor of the Smith amendment that 
will come up in the morning.
  Mr. President, I yield the floor.


                     amendment no. 27, as modified

  Mr. DORGAN. Mr. President, earlier today I voted to table an 
amendment that had been offered by Senator Feinstein regarding credit 
cards for young adults. This amendment would have required a $2,500 cap 
on credit card limits to anyone under the age of 21 unless they have a 
signature from their parent or can provide financial documents that 
establish their independent means of repaying their bills. I opposed 
this amendment because I am concerned that the age limit is arbitrary 
and could be unfair to many hard working Americans.
  I understand the concern that has been raised by many regarding 
credit card companies that blanket college campuses with brochures and 
solicitations. I agree that credit card companies have some 
responsibility in limiting credit to those who have no income. But I 
believe that the amendment that was offered today was not a good way to 
solve that problem.
  There are many people who are still in school at age 21. But there 
are many more who are holding down full time jobs, working to start a 
family, and deserve to have financial tools available to them, 
including credit cards without artificial credit limits. A 19-year-old 
North Dakotan can vote, serve in the military, and is considered an 
adult under state and federal laws. This amendment would create new 
hoops for that young person to access a credit card with a limit over 
$2,500. This is not a fair approach and is not an appropriate solution 
to the problem that the amendment's supporters are trying to solve.
  Credit card companies have a role to play as we reform bankruptcy 
laws. They should be held accountable for offering credit responsibly. 
But this amendment missed its mark. A person under the age of 21 should 
be able to have and use credit cards if they are working and have an 
income. For this reason, I opposed the amendment and supported the 
motion to table.
  Mr. BYRD. Mr. President, today I voted in favor of Mrs. Feinstein's

[[Page S2213]]

amendment to the bankruptcy reform bill that would limit the amount of 
credit that credit card companies can extend to underage consumers. For 
the benefit of my West Virginia constituents, I offer a brief 
explanation of my vote.
  I supported the Feinstein amendment because I agree with the general 
philosophy behind it. Credit card companies are far too willing to 
offer credit cards to young, financially-inexperienced consumers. Many 
of these young consumers are college students without any income or 
credit history. Too often these young consumers get in over their head 
when credit card companies offer unlimited credit to buy whatever they 
want, whenever they want. The Feinstein amendment is a commonsense 
approach that would restrict the amount of credit that could be offered 
to these young consumers, unless they gain parental approval or are 
able to demonstrate their financial independence.
  However, I disagree that $2,500 is an adequate credit limit for 
protecting underage consumers. My own view is that this amount is too 
high. I would prefer to see a $500 credit limit. Even with a credit 
limit of $2,500, young consumers are at risk of accumulating massive 
credit card debt without the ability to repay it. A smaller credit card 
limit is more likely to reduce this risk.
  My hope is that, even though the Senate rejected this amendment, 
credit card companies will take it upon themselves to more carefully 
scrutinize to whom they are extending credit, and reign in their credit 
offers when necessary.
  Mr. INHOFE. Mr. President, this morning the Senate briefly debated 
and tabled the Feinstein amendment No. 27 to S. 420, the bankruptcy 
reform bill. I was unable to make that vote this morning, but I did 
want to make a brief statement for the record to register my opposition 
to the amendment. Under the Feinstein amendment, credit card companies 
would be forced to limit the debt a minor can carry on a credit card to 
$2,500, unless the minor demonstrates a means to pay back the debt or a 
parent cosigns for the debt. I oppose this amendment as unnecessary 
government intervention in the marketplace. Washington has no place in 
limiting or determining the financial needs of students and their 
ability to repay loans. The government has an abysmal track record when 
it meddles in the marketplace, and I strongly believe that these 
decisions should be made by individuals and families, not by the 
federal government.


                           Financial Privacy

  Mr. LEAHY. Mr. President, I planned to offer an amendment to this 
bankruptcy bill to protect financial privacy and prevent identity theft 
in electronic bankruptcy court records. I thank Senators Sarbanes, 
Harkin, Schumer, and Rockefeller for agreeing to cosponsor this 
amendment.
  This amendment addressed just a single area where the Federal 
Government, here, the Bankruptcy Courts, holds significant amounts of 
highly personal information, which is freely available for any person 
for any reason to access and use. The manner in which all three 
branches of the Federal Government, the Federal agencies, the Congress 
and the Judiciary, protect the privacy of personal information that 
Americans are required to divulge to the government, is an important 
area that needs our attention. I thank the Chairman of the Judiciary 
Committee for agreeing to work with me on addressing the problem in a 
more comprehensive manner.
  Mr. HATCH. My distinguished colleague makes a good point, and one 
where we both agree on, and frankly, it is something on which there is 
bipartisan interest. The issue of privacy, both online and offline, is 
something that we have discussed together and both agree that the 
Committee should examine, and will be examining, the current legal 
framework for privacy protection and determine where improvements can 
and should be made. This is an important matter on which we have agreed 
to hold hearings and move forward with legislative proposals, where 
appropriate.
  Mr. LEAHY. While much attention has been focused on online privacy 
and the use of personally identifiable information by commercial web 
sites, the Federal Government is a huge repository of personal 
information in both paper and electronic form. Balancing the important 
interests of public access to government records with privacy 
protection for personal information is not always easy to do.
  Mr. HATCH. I agree, this is a difficult subject, but one we must 
tackle and I believe as policy-makers, Congress has an important role 
to play in making sure this balance is done properly. It is becoming 
increasingly more important as we see government using technology to 
become more efficient, more user friendly, and we need to be sure that 
the new ease of use of government resources do not compromise the 
citizenry's privacy expectations.
  Mr. LEAHY. The federal judiciary is grappling with the issue of how 
to put additional court filings online while providing appropriate 
levels of privacy protection and security for the information in those 
records. Bankruptcy records, for example, contain all kinds of highly 
sensitive personal and financial information, including social 
security, bank and credit card account numbers; medical history; and 
child support and alimony information. This information may pertain to 
the debtor but also to many other people who are creditors or simply 
associated or employed by the debtor. These records have traditionally 
been available to the public for perusal by individuals who went to the 
court house, requested the records, and physically reviewed the hard 
copies. This was an open process, but it was cumbersome. The 
inefficiency of obtaining data provided its own protective shield. For 
the most part, only those with a legitimate interest in bankruptcy 
court data took the trouble to collect it.
  As courts increasingly go online, however, personal information such 
as that contained in court filings may be posted on the Internet 
available for some legitimate uses but also vulnerable to misuse or 
objectionable re-use. In some cases, personal information of parties 
with only limited interest in a bankruptcy case can be widely 
distributed and posted online. Last August, for example, employees of 
an Internet retailer were shocked to learn that their salaries, 
bonuses, stock-option information, and home addresses were posted on 
the Web. Their employer, Living.com, had filed for bankruptcy and 
submitted all corporate financial data to the courts. Then, at the 
request of the company's creditors, the trustee in the case posted this 
highly personal data, information about employees, not about debtors, 
on the Web. In an unusual twist, the home addresses of 1,000 of 
Living.com's creditors were also posted on the Internet. The Living.com 
case demonstrates the risks of automatic electronic disclosure of data, 
threats that can befall not just debtors, but employees and even 
creditors.
  Federal agencies could also do a better job of protecting the privacy 
of those who do business with or seek help or information from the 
government. A recent GAO study reports that while most major federal 
agency sites post privacy notices, many do not do so on pages that 
collect personal information and few satisfy the principles of notice, 
choice, security and access that the Federal Trade Commission believe 
should be met by commercial sites. Moreover, the Privacy Act has not 
been seriously examined or updated for over twenty years. It is not 
doing the job it was originally intended to do of protecting the 
privacy of personal information provided to and held by the government. 
I look forward to working with the Chairman on addressing these and 
other important privacy issues in this Congress.
  Mr. HATCH. I certainly share your concerns regarding the privacy 
implications of government actions. I should note that I understand the 
Judicial Conference is also looking at this issue, but it is clearly 
one that we must oversee as it raises important policy issues, as well 
as important First Amendment and Fourth Amendment concerns. In the 
bankruptcy context, I should state that I believe it is critical that a 
delicate balance be established between the privacy interest of the 
debtor who seeks to take the privilege afforded under our bankruptcy 
laws, and the need in the case of bankruptcies for creditors whose 
debts are being extinguished, as well as those who enforce against 
fraud in our bankruptcy system, to obtain information about the debtor 
and the bankruptcy case. A fair

[[Page S2214]]

balancing of these competing concerns is critical, and one that the 
Congress, and particularly the Judiciary Committee, must take an active 
role.
  I think that there is no question that making sure the privacy 
policies and practices of the Federal Government is important. In 
addition, we should make sure that the privacy laws governing the 
Federal Government's use of personally identifiable information work 
effectively. This is an important issue that we can both work together 
to make happen, and if I remember correctly, it is one that Attorney 
General Ashcroft has similar concerns about.

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