[Congressional Record Volume 148, Number 123 (Wednesday, September 25, 2002)]
[House]
[Pages H6678-H6681]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   EXPRESSING THE SENSE OF THE HOUSE ON PERMANENCY OF PENSION REFORM 
                               PROVISIONS

  Mr. PORTMAN. Mr. Speaker, pursuant to House Resolution 547, I call up 
the resolution (H. Res. 544) expressing the sense of the House of 
Representatives on permanency of pension reform provisions, and ask for 
its immediate consideration.
  The Clerk read the title of the resolution.
  The text of the resolution is as follows:

                              H. Res. 544

       Whereas increasing pension coverage and pension savings is 
     crucial to retirement security;
       Whereas the Economic Growth and Tax Relief Reconciliation 
     Act of 2001 provided significant bipartisan pension reforms 
     that would increase pension savings and increase the number 
     of employees covered by employer pension plans;
       Whereas these pension reforms are scheduled to expire after 
     2010;
       Whereas a bipartisan majority of the House of 
     Representatives passed H.R. 4931, the Retirement Security 
     Savings Act of 2002, on June 21, 2002 by a vote of 308-70 to 
     permanently extend these important pension benefits;
       Whereas failure to enact H.R. 4931 would significantly 
     impact retirement planning and retirement security by 
     eliminating pension reforms that exist under present law; and
       Whereas the Senate has not passed the Retirement Security 
     Savings Act of 2002 or equivalent legislation: Now, 
     therefore, be it
       Resolved, That it is the sense of the House of 
     Representatives that the Congress should complete action in 
     the 107th Congress on the Retirement Security Savings Act of 
     2002 and present such legislation to the President for his 
     signature prior to adjournment so that American workers can 
     be assured that the pension reforms under present law will 
     not be eliminated.

  The SPEAKER pro tempore. Pursuant to House Resolution 547, the 
gentleman from Ohio (Mr. Portman) and the gentleman from California 
(Mr. Matsui) each will control 30 minutes.
  The Chair recognizes the gentleman from Ohio (Mr. Portman).

                              {time}  1845

  Mr. PORTMAN. Mr. Speaker, I yield 3 minutes to the gentleman from 
Texas (Mr. Brady), a valued member of the Committee on Ways and Means.
  Mr. BRADY of Texas. Mr. Speaker, I thank the gentleman from Ohio for 
yielding me time and thank him for his leadership in this very 
bipartisan effort to increase and protect retirement savings.
  Let me, as an aside, tell you that retirement security is very 
important in my district. I have many Enron workers in my district. 
Many of them are my neighbors who have lost their jobs, lost their 
whole retirement savings through no fault of their own. Listening to 
the debate tonight, I continue to be ashamed of those in Congress who 
continue to try to score political points off the misery of our Enron 
workers and shareholders.
  We have an opportunity, both in urging the Senate to take this bill 
off their calendar and to help us protect retirement savings, and we 
have it in this resolution as well, where we are trying to protect 
improvements that have been made to help people save.
  We simply do not save enough in America. For the life of me, I do not 
know why Washington insists on creating obstacles to savings, punishing 
people for trying to put money aside for their education or their 
retirement or for health care, for a rainy day. Under the bill that we 
passed in a very bipartisan way, we helped remove those obstacles.
  Unfortunately, unless we make those incentives permanent, in 10 years 
we are going to make it harder again for people to save. Without the 
Senate taking this bill from the calendar, where it has remained for 
quite some time, too long, the maximum amount that you and I can 
contribute to our IRA each year will be cut from $5,000 to $2,000, at a 
time we need it the most. The most that we can contribute to our 
savings plans at work will be cut almost $5,000, again at a time when 
inflation adds up and we need those savings the most.
  This catch-up provision for people, especially women, who worked at 
home while others set up their business or worked, who can make catch-
up retirement contributions, that will be eliminated. Also the 
portability, which means when people move from job to job, like a 
backpack they can take their pension retirement with them easily, that 
will be erased as well.
  So we have added expenses and obstacles and disincentives to savings 
that simply do not belong there. Congress was wise to remove it. We 
would be much wiser to make it permanent.
  I support this resolution, and anyone who truly cares about savings 
ought to do the same.
  Mr. MATSUI. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, it is kind of interesting, because I do not have anybody 
that wants to speak. This bill is so meaningless, so irrelevant, so 
worthless, that not one of my colleagues on our side of the aisle wants 
to speak. I think the other side probably has two or three, probably 
because they want to say something, I do not know what. But again, this 
is a resolution that asks the other body to pass a bill that we passed.
  Now, under the rules of the institution, of the Congress, after we 
pass a piece of legislation we enroll it and then we send it over to 
the other body so they know they can either take action or take no 
action. If they decide to take no action, then the next logical thing 
is, maybe you do not want to walk over there, maybe the 5-minute walk 
takes too long, how about just calling them up and saying, hey, what is 
wrong with the bill we sent over, because we want to move it. Then 
maybe you can have a discussion. But, instead, we have to pass a 
resolution, keep all the staff here; and no one really wants to speak 
about it.
  I will tell you why this is so irrelevant. This is unbelievable. It 
is so irrelevant because this will not take effect until 2010. This 
will not take effect until the year 2010, 8 years from now. We are not 
even going to be around here. Maybe that is why we are doing it now, 
because we want to make sure our legacy is going to be effective in 
2010. This is not going to have any effect, even if it became law, 
until the year 2010.
  Well, let me just say this, if I may, Mr. Speaker, because I do not 
want to get into the substance too much, but I think it does require a 
little discussion about the substance. In this proposal that was passed 
by the House, and is not being passed by the other body and will not 
take effect, at least the extension of this law, for 8 years, 84 
months, 8 years, in this proposal we actually make significant changes 
in the anti-discrimination law, that is a very technical law, and also 
the top-heavy rules.
  I have a letter dated April 11 when the bill was being considered by 
the House by Daniel Halperin, who just happens to be a professor of law 
at Harvard University, an expert on pension law; and he says if this 
bill is allowed to continue and take effect, at that time it had not 
taken effect, but it is in effect now, it could allow about 80 percent 
of the ordinary workers of a company that are non-highly compensated to 
be excluded from the plan, the pension plan. Eighty percent of the 
workers could be excluded from the pension plan. You just help the 
high-level employees.
  Then I have a letter from a professor from the University of Alabama 
named Norman Stein, not a real liberal institution, Alabama; but he 
indicates that this bill was cobbled together by the pension industry.
  Of course, Karen Ferguson, director of a group that makes sure that 
beneficiaries are adequately taken care of on pension benefits, 
basically said this bill is really going to do damage to the average 
worker in America because it is going to create a situation because of 
the top-heavy rules and anti-discrimination rules where pension 
benefits are going to be eliminated.
  The gentleman from Ohio (Mr. Portman) has said, because I remember 
the debate he had last time, that, no, what is going on, the reason why 
Americans are not having more pension benefits is because these rules 
are too complicated and it does not do enough for the highly 
compensated employees. So why would a manager, an executive, set up a 
pension plan if he is not going to benefit?
  The reason he does not set up that plan, I say to the gentleman from 
Ohio,

[[Page H6679]]

is because they found a way to get around it. These high-level 
executives had companies like Arthur Andersen who advised them in tax 
laws. We know what that is really all about. So what they have done was 
they set up rules like Ken Lay had in which he was able, without being 
taxed, to have his deferred compensation placed in an offshore trust 
account, so that when he finally retired and when Enron went bankrupt 
and all the employees lost their 401(k) plans, he was able to then get 
millions of dollars in deferred compensation. So he found a way around 
dealing with pension benefits. He had a defined benefit plan, and the 
Enron employees had what is known as a defined contribution plan, 
subject to the stock market; and they lost everything.
  Of course, you have all kinds of gimmicks that insurance companies 
use, for example the split dollar plan, and we all heard about that, 
because many folks were worried that was going to be eliminated. So 
that is another plan that highly compensated employers could engage in.
  So they really do not need to set up system-wide plans in companies, 
because of the fact that they are being taken care of through the Tax 
Code or through other mechanisms that have been thought through by the 
Arthur Andersens and all those smart people that know how to deal with 
tax laws.

  What we really should be doing instead of passing meaningless 
resolutions is really try to deal with the average American's pension 
benefit. There are only three ways when a person is ready to retire 
that they think about their retirement. One is personal savings, and we 
know a great majority of Americans do not have personal savings because 
they have family responsibilities, kids going to college. So most of 
the time even families that make $70,000, $80,000 a year, spend that 
money right away on their families, because those are just necessities. 
So they do not have any savings, except their house. That is the only 
thing they have.
  Then you have 401(k)s. Because we do not have these defined benefit 
plans in existence anymore, it is basically 401(k) plans. You saw what 
happened when the market went down 40 percent the last 18 months, since 
the President was sworn into office. So that obviously is subject to 
the economy, and subject to the global economy as well.
  Of course, the one thing that at least the Enron employees and the 
WorldCom employees told me when they came to Washington, they said, 
``At least I have my Social Security benefits.'' But we know about 
Social Security benefits, because the President wants to privatize 
Social Security. The President wants to make Social Security subject to 
the stock market.
  Well, if the President gets his way and if we do not take action on 
the 401(k)s, if we do not do something about these highly compensated 
employers and we extend this law beyond 2010, I think we are going to 
do major damage to the baby boom population. We have had all kinds of 
studies in America now that people 45 years and older, they are not 
going to be ready for retirement. In fact, all they are going to have 
is maybe $20,000 or $30,000 in their 401(k) plans. If they live another 
20 years, that is going to be gone within a couple of years. All they 
have is Social Security, and that may not be secure if the President is 
successful in privatizing Social Security.
  So I have to ask myself, what are we doing here at 7 o'clock in the 
evening debating a bill that is meaningless and not taking up some of 
the real important problems of America? Well, it is because you cannot 
do it. My colleagues on the other side of the aisle cannot pass these 
other bills that are really critical to the American public. They 
cannot deal with the national economy. That is why we are fooling 
around with meaningless resolutions. That is why I have no colleagues 
that want to speak on this, because it is meaningless.
  Mr. Speaker, I reserve the balance of my time.
  Mr. PORTMAN. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I would suggest that perhaps the reason there are not a 
lot of people who want to speak in opposition is because this has been 
a very popular piece of legislation. It passed the House by over 400 
votes. Even in the context of the tax cut, which was quite a partisan 
exercise, it passed with 308 votes. It is good legislation.
  I would love the opportunity to address some of the concerns that the 
gentleman from California (Mr. Matsui) raised, and I would like to do 
so in a moment.
  Mr. Speaker, I yield 4 minutes to the gentleman from Illinois (Mr. 
Weller), a valued member of the Committee on Ways and Means, who was 
instrumental in putting together this legislation, particularly with 
regard to the very important provisions to help multi-employer plans. 
There was tremendous complexity surrounding these multi-employer plans. 
Section 415 needed to be reformed, something that had been talked about 
for years. Finally, with this legislation we got it done. I hope my 
colleague will address that.
  Mr. WELLER. Mr. Speaker, of course I rise in support of this 
resolution which, frankly, is very, very important; and I commend the 
gentleman from Ohio (Mr. Portman) for the leadership he has given on 
this issue.
  You know, if you listen to the rhetoric of my friends on the other 
side of the aisle, you can see they are, frankly, laying the groundwork 
for a tax increase. They opposed permanency of the Bush tax cut, they 
are opposing permanency of the individual provisions, whether marriage 
penalty or death tax, and even the most popular provision, which, of 
course, is the pension provisions that we have before us today.
  They are opposing it; and, frankly, a vote against this resolution 
essentially is a vote in favor of a tax increase. As you can see from 
the rhetoric and their procedural moves that they always take, they are 
trying to stall, stymie and delay making permanent the Bush tax cuts, 
because they believe that money can be better spent here in Washington 
than hardworking Americans can spend it back home. I believe, as I know 
the majority of my colleagues do, that we should allow working 
Americans to keep more of what they earn.
  Today we are, of course, talking about the opportunity to improve 
retirement savings. This House passed this with overwhelming bipartisan 
support. In fact, the Bush tax cut, the final version passed with 
overwhelming bipartisan support. Unfortunately, it was not permanent; 
but we passed legislation increasing opportunity for retirement 
savings, which benefits every American who pays taxes. We increased the 
opportunity to give a larger amount to your individual retirement 
accounts, increased that from $2,000 to $5,000. We increased what you 
can put into your 401(k) from $10,000 to $15,000.
  I would note that there are catch-up provisions. People like my 
sister Pat, who are out of the workforce for a few years, staying home 
with the kids, the family income is less and they were not able to set 
aside much or anything for retirement savings. Now they can make a 
catch-up contribution once they turn 50, which will be a great benefit 
to stay-at-home moms and empty-nesters. Thanks to the Bush tax cut, 
that is now law. Unfortunately, it is temporary.
  I would also note, as the gentleman from Ohio (Mr. Portman) pointed 
out, we had an important reform that benefited over 10 million 
construction workers, building tradesmen and women, all across this 
country, who benefit from the removal of the caps put in place under 
section 415, which affects the multi-employer pension funds, which are 
basically labor union and building trade pension funds. Those 
artificial caps have been in place for far too long. Thanks to the Bush 
tax cut, they have been removed. And for a couple like Larry Kohr of 
Peru, Illinois, and his wife, he saw his take-home pension that he can 
live on, now that he has retired, essentially double by removing those 
artificial caps. There is no science and no reason to have them; nobody 
had just gone back to fix them.

                              {time}  1900

  So that section 415 provision, which claims a lot of bipartisan 
support unfortunately will expire unless we make it permanent.
  That is why I was pleased earlier this year that the House of 
Representatives passed with a vote of 407 Members, the vast majority of 
Democrats; only a

[[Page H6680]]

very small, narrow group of Democrats voted against making permanent 
this legislation. Unfortunately, the Senate has not yet taken up this 
legislation. My hope is that the House and Senate can work together in 
a bipartisan way and make permanent efforts to eliminate that cap on 
section 415, as well as increase opportunities for retirement savings. 
So let us really get to what the real issue is here before us.
  The question before us today is, do we make permanent the portion of 
the Bush tax cut which gives increased opportunity for retirement 
savings, helping construction workers, helping those who have IRAs or 
401(k)s, helping empty-nesters or stay-at-home moms do what we all need 
to do more of, and that is to set aside more for our retirement 
savings. Think about this: unless we make it permanent, those 
opportunities go away. That is a tax increase on savings; that is a tax 
increase on working Americans. This is a simple vote, and that is if 
you vote ``no,'' you are voting to raise taxes on all those who wish to 
save for their retirement.
  Mr. Speaker, I urge an ``aye'' vote, and I commend the gentleman from 
Ohio for his resolution before the House.
  Mr. MATSUI. Mr. Speaker, it is my understanding that the gentleman 
from Ohio (Mr. Portman) is the only other speaker on their side, and I 
am the last speaker, the only speaker on my side, and if the gentleman 
is, and we can have some understanding that we are going to kind of 
keep it light and short, I will yield back the balance of my time, with 
that understanding.
  Mr. PORTMAN. Mr. Speaker, I thank the gentleman. I do not know about 
keeping it light, but we will try to keep it short.
  Mr. MATSUI. Mr. Speaker, I yield back the balance of my time.
  Mr. PORTMAN. Mr. Speaker, I yield myself such time as I may consume.
  I guess it has been a helpful discussion. What we are doing here 
today is we are trying to shed light on the fact that the House-passed 
legislation, which made these good retirement changes permanent, which 
the other body chose not to do that; it had to be done on a temporary 
basis, only for the next 8 years.
  We think it is very important for the purposes of planning, and what 
is more important than retirement planning? It is very important to the 
person who is planning to have some permanency. It is important to the 
individual worker. People need to plan for their retirement. It is 
planning for more than 8 years out. We need to know it is going to be 
there for the baby boom generation; we need to know that it is going to 
be permanent changes in law. For the employer, particularly the small 
employer, who is thinking about getting into the pension business for 
the first time; only 20 percent of those with 25 or fewer employees now 
offer pensions. For those people, they need to be able to plan. So not 
to have this be permanent is bad policy. It makes no sense at all. That 
is what we are doing today. We are trying to shine some light on this 
issue so that our friends in the other body will move.
  Now, let me just talk a little bit about what this is all about. It 
is really three general areas: First, allowing everyone to contribute 
more to their 401(k)s and their IRAs. This could not come at a more 
important time. The fact that you can contribute another $1,000 into 
your IRA account this year is very important to people, and they are 
taking advantage of it. In the first 6 months of this year alone, there 
has been a 25 percent increase in IRA contributions, and it is needed, 
and never needed more than now.
  With regard to 401(k)s, this year you can put another $500 in, plus a 
catch-up, as the gentleman from Illinois (Mr. Weller) talked about, 
another $500. Over time, another $5,000 and $10,000, up to $15,000. 
This is extremely important, again. I would like to accelerate that. I 
would hope that this House will take that up at some point so that we 
can immediately allow people to put more aside for their retirement. 
But at a minimum, let us make what we did permanent.
  The catch-up provisions are extremely important to the baby boomers. 
The gentleman from California (Mr. Matsui) talked about the baby boom 
generation not being prepared for retirement. It is true. Seventy-five 
million people have no retirement plan at all, other than what they 
might have saved in their own personal savings. They have no access to 
a 401(k), a simple plan, any kind of plan from their employer. We need 
to help these people.
  We therefore said if you are over 50, you get to put in even more 
into your retirement plan, which is particularly helpful for women who 
have taken time out from the workforce to raise a family, and now want 
to come back in and need to be able to put together that nest egg 
quickly.
  The second general area is portability, enabling people to go from 
job to job in a seamless way to move their retirement savings.
  Finally, we permit for simplification of the plan, to help small 
businesses to be able to offer these plans. The gentleman from 
California (Mr. Matsui) actually talked about it earlier, and I was 
going to get into it. I would ask the gentleman's indulgence, instead 
of me getting further into that issue, if I could yield some time to 
the gentleman from Oklahoma (Mr. Sullivan), who is now here, to speak 
on the general issue.
  I instead will cut my remarks short, except to say this, and that is 
that this is all about helping people save more for retirement. This 
House has passed this on a bipartisan basis, over 400 votes. What we 
are saying here today is it is time to move to make that permanent so 
people can plan. It is common sense policy. The Senate has not acted, 
the House has, the President is ready to sign the bill. Let us move 
forward.
  Mr. Speaker, I yield 2 minutes to the gentleman from Oklahoma (Mr. 
Sullivan) as a final speaker.
  Mr. SULLIVAN. Mr. Speaker, today I rise in support of House 
Resolution 544. As a sponsor of this legislation, I feel it is 
important for Congress to make permanent the Economic Growth and Tax 
Reconciliation Act passed into law last year. I would like to thank my 
distinguished colleagues, the gentleman from Ohio (Mr. Portman) and the 
gentleman from Maryland (Mr. Cardin), for spending several years 
crafting this bipartisan legislation.
  This measure includes significant pension reforms aimed at 
modernizing retirement security. The law is scheduled to sunset after 
December 31, 2010. People throughout the First District of Oklahoma and 
all across America are restricted in planning for their retirement 
because of an arcane Senate rule that makes the entire tax relief 
package, including the retirement savings provisions, expire in just 10 
years. Retirement plans are based on rules that need to be consistent 
over a career, not just 10 years. I do not base my future retirement 
plans on the next 9 years, so I do not expect to legislate and 
encourage that standard for my constituents and all Americans. The law, 
as passed last year, gives employees the additional resources to 
appropriately plan for their retirement. The act contains many 
significant provisions that will be extremely beneficial to employees.
  First of all, we allowed workers to invest more money into their 
401(k) and pension plans, as well as IRAs, from $2,000 to $5,000. 
Secondly, the House modernized pension laws to meet the challenges of 
an increasingly mobile workforce that is likely to have several jobs 
during their career. The resolution also allows workers to become 
vested in their pension plans faster.
  In addition, the measure allows workers age 50 and older to make 
catch-up contributions, a provision that will significantly help women 
who are more likely to spend more time away from the workforce.
  Finally, the bill modernizes pension laws and provides regulatory 
relief to encourage more small businesses to offer retirement plans.
  Mr. Speaker, I urge my colleagues to adopt this measure.
  Mr. PORTMAN. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. LaTourette). All time for debate has 
expired.
  Pursuant to House Resolution 547, the resolution is considered read 
for amendment and the previous question is ordered on the resolution.
  The question is on the resolution.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. PORTMAN. Mr. Speaker, on that I demand the yeas and nays.

[[Page H6681]]

  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this question are postponed.

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