[Congressional Record Volume 155, Number 48 (Thursday, March 19, 2009)]
[Senate]
[Pages S3536-S3539]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     FAIRNESS OF FINANCIAL MARKETS

  Mr. KAUFMAN. Mr. President, I wish to spend a few minutes talking 
about action that needs to be taken to restore the credibility of the 
fairness of the American financial markets.
  On Monday, Senators Isakson, Tester, and I introduced S. 605, which 
directs the Securities and Exchange Commission to write regulations 
that will deal effectively with abusive short selling.
  One of the abusive techniques addressed in the bill is so-called 
``naked short selling.'' Naked short selling is when traders sell 
shares they don't own and have no ability to deliver at the time of 
sale--which dilutes the value of a company's shares and can drive 
prices down artificially.
  Before the ink on our bill was even dry, we received a profoundly 
disappointing report from the SEC's inspector general entitled 
``Practices Related to Naked Short Selling Complaints and Referrals,'' 
a report detailing the results of an audit on the SEC Division of 
Enforcement's policies, procedures and practices for processing 
complaints about naked short selling.
  An astounding 5,000 complaints about abusive short selling were sent 
to the SEC's Enforcement Division between January 1, 2007 and June 1, 
2008. There could be no mistaking the scale of the potential problem 
that that number of complaints reflected. Incredibly, a mere 123 
complaints were referred for further investigation. Worse, and I quote: 
``none of the forwarded complaints resulted in enforcement actions . . 
.'' five thousand complaints, zero enforcement actions.
  Not surprisingly, the SEC inspector general has concluded that the 
processes for dealing with such complaints need a fundamental overhaul.
  Accordingly, the IG made 11 suggestions for improvements. And how did 
the Enforcement Division respond? It agreed to one of the IG's 
recommendations, and declined to move on the rest.
  I have been around Washington and the Senate for 36 years, but rarely 
have

[[Page S3537]]

I seen an inspector general's call for action so summarily dismissed.
  In its comments to the IG report, the SEC Enforcement Division 
stated:

     there is hardly unanimity in the investment community or the 
     financial media on either the prevalence, or the dangers, of 
     ``naked'' short selling.

  I ask my colleagues: Why would the SEC Enforcement Division want to 
wait until there is unanimity in the investment community and the 
financial media to enforce the law? Why would the SEC Enforcement 
Division in its comments to the IG report want to give a virtual 
``green light'' to continued abusive naked short selling? That is an 
enforcement division that is not worthy of its name.
  In the IG's response to the Enforcement Division, the IG notes that 
it is ``disappointed'' that the Enforcement Division only concurred 
with one of the 11 recommendations in the audit report. The IG is 
``particularly concerned'' that the Enforcement Division did not concur 
in its first three recommendations--that the Division should develop a 
written in-depth triage analysis for naked short selling complaints.
  Moreover, the IG notes:

       SEC has repeatedly recognized that naked short selling can 
     depress stock prices and have harmful effects on the market. 
     In adopting a naked short selling antifraud rule, Rule 10b-
     21, in October 2008, the Commission stated, `We have been 
     concerned about ``naked'' short selling and, in particular, 
     abusive `naked' short selling, for some time.

  Where does this leave us, Mr. President? We have an SEC that is 
ostensibly concerned about abusive naked short selling, but we have an 
enforcement division--after receiving literally thousands and thousands 
of complaints about naked short selling--that has brought no 
enforcement actions and doesn't take seriously an IG audit and 
recommendations.
  This is an outrage.
  I want to be clear, this was the record from a review of last year's 
examination of short selling complaints. This is an issue Mary 
Schapiro, the new SEC chair, has inherited. She just got to the SEC. 
But this is a strong indication of the need for real leadership at the 
SEC. Unless and until that happens, investors will have reason to worry 
that markets are not yet free of manipulation and abuse.
  Of all the challenges confronting our financial system, none is more 
important than restoring investors' trust and confidence in the 
market--the belief that the game isn't rigged against them. After the 
disastrous and unprecedented losses of the past year, millions of 
Americans will refuse to put their resources back into the stock market 
until they believe the system is once again sound, fair and adequately 
overseen by the SEC.
  In the not-so-distant past, a strategy of long-term buying-and-
holding offered a roadmap for comfortable living in retirement and the 
ability to provide to our children and grandchildren that all-important 
economic head start in life.
  Then, the market valued companies based on economic fundamentals and 
expected future profits.
  Today, too many people view the stock markets as another gambling 
casino, dominated by volatility and susceptible to predatory short 
sellers who profit from false rumors and bear raids.
  To restore faith in our securities markets, the Securities and 
Exchange Commission urgently needs to reflect a clear commitment to 
meaningful change.
  It is time to restore the integrity, efficiency and fairness of our 
securities markets by preventing manipulative short selling, ensuring 
that the market fairly values the actual shares issued by a company, 
and outlawing the creation of ``phantom shares'' by abusive short 
sellers.
  Let's remember how we got here. The opaque derivatives market allowed 
some people to play a shell game by leveraging to the hilt and buying 
and selling synthetic instruments that ultimately crashed in value. The 
same thing happens through abusive short selling, when traders sell 
shares they do not own and have no ability to deliver at the time of 
sale.
  It is like making copies of your car's title, and then selling the 
title to the car three times, while hoping you can find other cars to 
deliver if the buyer proceeds.
  In some cases, the short interest in a particular company's stock on 
a given day has spiked dramatically after false rumors have circulated 
about the company. The data further show that ``fails'' to deliver are 
large and problematic.
  That is evidence of manipulation. It distorts the market. It must end 
now.
  Let me be clear: the problem isn't short selling itself, which can 
enhance market efficiency and price discovery.
  The problem is that, under current rules, short sellers can sell 
stocks they haven't actually borrowed in advance of their short sale--
and with no uptick rule in place as a circuit breaker. The current 
standard requires only a ``reasonable belief'' that a short seller can 
locate the necessary shares by the delivery date; that is no standard 
at all and subjects the market to rife abuse.
  For the market to flourish again, the SEC must issue rules and 
enforce them in a way that convinces investors the system is not rigged 
against them.
  One important step the SEC should take now is to reinstate the 
substance of its former ``uptick'' rule.
  The uptick rule served us well for 70 years until the SEC rescinded 
it in July 2007. It required short sellers to take a breath and wait 
for a sale at a higher price before continuing to sell short in 
declining markets. According to one survey, 85 percent of CEOs, and 
professionals at NYSE-listed companies favor reinstating it. Fed 
Chairman Bernanke, bipartisan Members of Congress, and former 
regulators favor reinstating it. The SEC should do that now.
  Restoring the uptick rule is necessary, but not sufficient, to rein 
in abusive short selling. If the SEC is to alter fundamentally the way 
stocks trade today, it must also require--and enforce--short sellers 
possessing at the time of the sale a demonstrable legally enforceable 
right to deliver the shares--a so-called ``pre- borrow'' requirement. 
We simply can't tolerate a market that permits short sellers to create 
phantom shares that dilute a company's value, erode the value of 
investors' holdings and manipulate share prices downward.
  A recent Bloomberg news report based on SEC data confirmed that so-
called ``naked'' short selling contributed significantly to the demise 
of Lehman Brothers and Bear Stearns. Those companies took horrendous 
gambles and their share values had to reflect those serious missteps, 
but in the absence of ``naked'' short selling both might nevertheless 
have survived.
  Abusive short selling is gasoline on the fire for distressed stocks 
and distressed markets. And the knowledge that it is still tolerated 
rattles small investors and shakes confidence in our markets.
  Mr. President, I ask unanimous consent that this story be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                  [From Bloomberg.com, Mar. 19, 2009]

     Naked Short Sales Hint Fraud in Bringing Down Lehman (Correct)

                          (By Gary Matsumoto)

       (Corrects levels of failed-to-deliver shares in second and 
     18th paragraphs.)
       The biggest bankruptcy in history might have been avoided 
     if Wall Street had been prevented from practicing one of its 
     darkest arts.
       As Lehman Brothers Holdings Inc. struggled to survive last 
     year, as many as 32.8 million shares in the company were sold 
     and not delivered to buyers on time as of Sept. 11, according 
     to data compiled by the Securities and Exchange Commission 
     and Bloomberg. That was a more than 57-fold increase over the 
     2007 peak of 567,518 failed trades on July 30.
       The SEC has linked such so-called fails-to-deliver to naked 
     short selling, a strategy that can be used to manipulate 
     markets. A fail-to-deliver is a trade that doesn't settle 
     within three days.
       ``We had another word for this in Brooklyn,'' said Harvey 
     Pitt, a former SEC chairman. ``The word was `fraud.''
       While the commission's Enforcement Complaint Center 
     received about 5,000 complaints about naked short-selling 
     from January 2007 to June 2008, none led to enforcement 
     actions, according to a report filed yesterday by David Kotz, 
     the agency's inspector general.
       The way the SEC processes complaints hinders its ability to 
     respond, the report said.
       Twice last year, hundreds of thousands of failed trades 
     coincided with widespread rumors about Lehman Brothers. 
     Speculation that the company was being acquired at a discount 
     and later that it was losing two trading partners both proved 
     untrue.

[[Page S3538]]

       After the 158-year-old investment bank collapsed in 
     bankruptcy on Sept. 15, listing $613 billion in debt, former 
     Chief Executive Officer Richard Fuld told a congressional 
     panel on Oct. 6 that naked short sellers had midwifed his 
     firm's demise.


                            Gasoline on Fire

       Members of the House Committee on Government Oversight and 
     Reform weren't buying that explanation.
       ``If you haven't discovered your role, you're the villain 
     today,'' U.S. Representative John Mica, a Florida Republican, 
     told Fuld.
       Yet the trading pattern that emerges from 2008 SEC data 
     shows naked shorts contributed to the fall of both Lehman 
     Brothers and Bear Stearns Cos., which was acquired by 
     JPMorgan Chase & Co. in May.
       ``Abusive short selling amounts to gasoline on the fire for 
     distressed stocks and distressed markets,'' said U.S. Senator 
     Ted Kaufman, a Delaware Democrat and one of the sponsors of a 
     bill that would make the SEC restore the uptick rule. The 
     regulation required traders to wait for a price increase in 
     the stock they wanted to bet against; it prevented so-called 
     bear raids, in which successive short sales forced prices 
     down.


                          Driving Down Prices

       Reinstating the rule would end the pattern of fails-to-
     deliver revealed in the SEC data, Kaufman said.
       ``These stories are deeply disturbing and make a compelling 
     case that the SEC must act now to end abusive short selling--
     which is exactly what our bill, if enacted, would do,'' the 
     senator said in an e-mailed statement.
       Short sellers arrange to borrow shares, then dispose of 
     them in anticipation that they will fall. They later buy 
     shares to replace those they borrowed, profiting if the price 
     has dropped. Naked short sellers don't borrow before 
     trading--a practice that becomes evident once the stock isn't 
     delivered. Such trades can generate unlimited sell orders, 
     overwhelming buyers and driving down prices, said Susanne 
     Trimbath, a trade-settlement expert and president of STP 
     Advisory Services, an Omaha, Nebraska-based consulting firm.
       The SEC last year started a probe into what it called 
     ``possible market manipulation'' and banned short sales in 
     financial stocks as the number of fails-to-deliver climbed.


                        `Unsubstantiated Rumors'

       The daily average value of fails-to-deliver surged to $7.4 
     billion in 2007 from $838.5 million in 1995, according to a 
     study by Trimbath, who examined data from the annual reports 
     of the National Securities Clearing Corp., a subsidiary of 
     the Depository Trust & Clearing Corp.
       Trade failures rose for Bear Stearns as well last year. 
     They peaked at 1.2 million shares on March 17, the day after 
     JPMorgan announced it would buy the investment bank for $2 a 
     share. That was more than triple the prior-year peak of 
     364,171 on Sept. 25.
       Fuld said naked short selling--coupled with 
     ``unsubstantiated rumors''--played a role in the demise of 
     both his bank and Bear Stearns.
       ``The naked shorts and rumor mongers succeeded in bringing 
     down Bear Stearns,'' Fuld said in prepared testimony to 
     Congress in October. ``And I believe that unsubstantiated 
     rumors in the marketplace caused significant harm to Lehman 
     Brothers.''


                            Devaluing Stock

       Failed trades correlate with drops in share value--enough 
     to account for 30 to 70 percent of the declines in Bear 
     Stearns, Lehman and other stocks last year, Trimbath said.
       While the correlation doesn't prove that naked shorting 
     caused the lower prices, it's ``a good first indicator of a 
     statistical relationship between two variables,'' she said.
       Failing to deliver is like ``issuing new stock in a company 
     without its permission,'' Trimbath said. ``You increase the 
     number of shares circulating in the market, and that devalues 
     a stock. The same thing happens to a currency when a 
     government prints more of it.''
       Trimbath attributes the almost ninefold growth in the value 
     of failed trades from 1995 to 2007 to a rise in naked short 
     sales.
       ``You can't have millions of shares fail to deliver and 
     say, `Oops, my dog ate my certificates,' '' she said.


                          Explanation Required

       On its Web site, the Federal Reserve Bank of New York lists 
     several reasons for fails-to-deliver in securities trading 
     besides naked shorting. They include misunderstandings 
     between traders over details of transactions; computer 
     glitches; and chain reactions, in which one failure to settle 
     prevents delivery in a second trade.
       Failed trades in stocks that were easy to borrow, such as 
     Lehman Brothers, constitute a ``red flag,'' said Richard H. 
     Baker, the president and CEO of the Washington-based Managed 
     Funds Association, the hedge fund industry's biggest lobbying 
     group.
       ``Suffice it to say that in a readily available stock that 
     is traded frequently, there has to be an explanation to the 
     appropriate regulator as to the circumstances surrounding the 
     fail-to-deliver,'' said Baker, who served in the U.S. House 
     of Representatives as a Republican from Louisiana from 1986 
     to February 2008.
       ``If it's a pattern and a practice, there are laws and 
     regulations to deal with it,'' he said.


                          Fines and Penalties

       Lehman Brothers had 687.5 million shares in its float, the 
     amount available for public trading. In float size, the 
     investment bank ranked 131 out of 6,873 public companies--or 
     in the top 1.9 percent, according to data compiled by 
     Bloomberg.
       While naked short sales resulting from errors aren't 
     illegal, using them to boost profits or manipulate share 
     prices breaks exchange and SEC rules and violators are 
     subject to penalties. If investigators determine that traders 
     engaged in the practice to try to influence markets, the 
     Department of Justice can file criminal charges.
       Market makers, who serve as go-betweens for buyers and 
     sellers, are allowed to short stock without borrowing it 
     first to maintain a constant flow of trading.
       Since July 2006, the regulatory arm of the New York Stock 
     Exchange has fined at least four exchange members for naked 
     shorting and violating other securities regulations. J.P. 
     Morgan Securities Inc. paid the highest penalty, $400,000, as 
     part of an agreement in which the firm neither admitted nor 
     denied guilt, according to NYSE Regulation Inc.


                        Enforcement `Reluctant'

       In July 2007, the former American Stock Exchange, now NYSE 
     Alternext, fined members Scott and Brian Arenstein and their 
     companies $3.6 million and $1.2 million, respectively, for 
     naked short selling. Amex ordered them to disgorge a combined 
     $3.2 million in trading profits and suspended both from the 
     exchange for five years. The brothers agreed to the fines and 
     the suspension without admitting or denying liability, 
     according a release from the exchange.
       Of about 5,000 e-mailed tips related to naked short-selling 
     received by the SEC from January 2007 to June 2008, 123 were 
     forwarded for further investigation, according to the report 
     released yesterday by Kotz, the agency's internal watchdog. 
     None led to enforcement actions, the report said.
       Kotz, the commission's inspector general, said the 
     enforcement division ``is reluctant to expend additional 
     resources to investigate'' complaints. He recommended in his 
     report yesterday that the division step up analysis of tips, 
     designating an office or person to provide oversight of 
     complaints.


                            Schapiro's Plans

       The enforcement division, in a response included in the 
     report, said ``a large number of the complaints provide no 
     support for the allegations'' and concurred with only one of 
     the inspector general's 11 recommendations.
       SEC Chairman Mary Schapiro, who took office in January, has 
     vowed to reinvigorate the enforcement unit after it drew fire 
     from lawmakers and investors for failing to follow up on tips 
     that New York money manager Bernard Madoff's business was a 
     Ponzi scheme. She has ``initiated a process that will help us 
     more effectively identify valuable leads for potential 
     enforcement action,'' John Nester, a commission spokesman, 
     said in response to the Kotz report.
       Last September, the agency instituted the temporary ban on 
     short sales of financial stock. It also has announced an 
     investigation into ``possible market manipulation in the 
     securities of certain financial institutions.''


                          No Effective Action

       Christopher Cox, who was SEC chairman last year; Erik 
     Sirri, the commission's director for market regulation; and 
     James Brigagliano, its deputy director for trading and 
     markets, didn't respond to requests for interviews. John 
     Heine, a spokesman, said the commission declined to comment 
     for this story.
       ``It has always puzzled me that the SEC didn't take 
     effective action to eliminate naked shorting and the fails-
     to-deliver associated with it,'' Pitt, who chaired the 
     commission from August 2001 to February 2003, said in an e-
     mail. The agency began collecting data on failed trades that 
     exceed 10,000 shares a day in 2004.
       ``All the SEC need do is state that at the time of the 
     short sale, the short seller must have (and must maintain 
     through settlement) a legally enforceable right to deliver 
     the stock at settlement,'' Pitt wrote. He is now the CEO 
     of Kalorama Partners LLC, a Washington-based consulting 
     firm. In August, he and some partners started RegSHO.com, 
     a Web-based service that locates stock to help sellers 
     comply with short-selling rules.


                        Postponed `Indefinitely'

       Pitt began his legal career as an SEC staff attorney in 
     1968, and eventually became the commission's general counsel. 
     In 1978, he joined Fried Frank Harris Shriver & Jacobson LLP, 
     where as a senior corporate partner he represented such 
     clients as Bear Stearns and the New York Stock Exchange. 
     President George W. Bush appointed him SEC chairman in 2001.
       The flip side of an uncompleted transaction resulting from 
     undelivered stock is called a ``fail-to-receive.'' SEC 
     regulations state that brokers who haven't received stock 13 
     days after purchase can execute a so-called buy-in. The 
     broker on the selling side of the transaction must buy an 
     equivalent number of shares and deliver them on behalf of the 
     customer who didn't.
       A 1986 study done by Irving Pollack, the SEC's first 
     director of enforcement in the 1970s, found the buy-in rules 
     ineffective with regard to Nasdaq securities. The rules 
     permit brokers to postpone deliveries ``indefinitely,'' the 
     study found.

[[Page S3539]]

       The effect on the market can be extreme, according to Cox, 
     who left office on Jan. 20. He warned about it in a July 
     article posted on the commission's Web site.


                        Turbocharged Distortion

       When coupled with the propagation of rumors about the 
     targeted company, selling shares without borrowing ``can 
     allow manipulators to force prices down far lower than would 
     be possible in legitimate short-selling conditions,'' he said 
     in the article.
       `` `Naked' short selling can turbocharge these `distort-
     and- short' schemes,'' Cox wrote.
       ``When traders spread false rumors and then take advantage 
     of those rumors by short selling, there's no question that 
     it's fraud,'' Pollack said in an interview. ``It doesn't 
     matter whether the short sales are legal.''
       On at least two occasions in 2008, fails-to-deliver for 
     Lehman Brothers shares spiked just before speculation about 
     the bank began circulating among traders, according to SEC 
     data that Bloomberg analyzed.
       On June 30, someone started a rumor that Barclays Plc was 
     ready to buy Lehman for 25 percent less than the day's share 
     price. The purchase didn't materialize.


                             `Green Cheese'

       On the previous trading day, June 27, the number of shares 
     sold without delivery jumped to 705,103 from 30,690 on June 
     26, a 23-fold increase. The day of the rumor, the amount 
     reached 814,870--more than four times the daily average for 
     2008 to that point. The stock slumped 11 percent and, by the 
     close of trading, was down 70 percent for the calendar year.
       ``This rumor ranks up there with the moon is made of green 
     cheese in terms of its validity,'' Richard Bove, who was then 
     a Ladenburg Thalmann & Co. analyst, said in a July 1 report.
       Bove, now vice president and equity research analyst with 
     Rochdale Securities in Lutz, Florida, said in an interview 
     this month that the speculation reflected ``an unrealistic 
     view of Lehman's portfolio value.'' The company's assets had 
     value, he said.


                           `Obscene' Leverage

       During the first six days following the Barclays hearsay, 
     the level of failed trades averaged 1.4 million. Then, on 
     July 10, came rumors that SAC Capital Advisors LLC, a 
     Stamford, Connecticut-based hedge fund, and Pacific 
     Investment Management Co. of Newport Beach, California, had 
     stopped trading with Lehman Brothers.
       Pimco and SAC denied the speculation. The bank's share 
     price dropped 27 percent over July 10-11.
       Banks and insurers wrote down $969.3 billion last year--and 
     that gave legitimate traders plenty of reason to short their 
     stocks, said William Fleckenstein, founder and president 
     of Seattle-based Fleckenstein Capital, a short-only hedge 
     fund. He closed the fund in December, saying he would open 
     a new one that would buy equities too.
       ``Financial stocks imploded because of the drunkenness with 
     which executives buying questionable securities levered-up in 
     obscene fashion,'' said Fleckenstein, who said his firm has 
     always borrowed stock before selling it short. ``Short 
     sellers didn't do this. The banks were reckless and they held 
     bad assets. That's the story.


                           `Market Distress'

       On May 21, David Einhorn, a hedge fund manager and chairman 
     of New York-based Greenlight Capital Inc., announced he was 
     shorting stock in Lehman Brothers and said he had ``good 
     reason to question the bank's fair value calculations'' for 
     its mortgage securities and other rarely traded assets.
       Einhorn declined to comment for this story. Monica Everett, 
     a spokeswoman who works for the Abernathy Macgregor Group, 
     said Greenlight properly borrows shares before shorting them.
       Even when they're legitimate, short sales can depress share 
     values in times of market crisis--in effect turning the 
     traders' negative bets into self-fulfilling prophecies, says 
     Pollack, the former SEC enforcement chief who is now a 
     securities litigator with Fulbright & Jaworski in Washington.
       The SEC has been concerned about the issue since at least 
     1963, when Pollack and others at the commission wrote a study 
     for Congress that recommended the ``temporary banning of 
     short selling, in all stocks or in a particular stock'' 
     during ``times of general market distress.''


                             Airport Runway

       On Sept. 17, two days after Lehman Brothers filed for 
     Chapter 11 bankruptcy, the number of failed trades climbed to 
     49.7 million, 23 percent of overall volume in the stock.
       The next day, the SEC announced its ban on shorting 
     financial companies in 2008. The number of protected stocks 
     ultimately grew to about 1,000. On Sept. 19, the commission 
     announced ``a sweeping expansion'' of its investigation into 
     possible market manipulation.
       The ban, which lasted through Oct. 17, didn't eliminate 
     shorting, according to data from the SEC, the NYSE Arca 
     exchange and Bloomberg. Throughout the period, short sales 
     averaged 24.7 percent of the overall trading in Morgan 
     Stanley, Merrill Lynch & Co. and Goldman Sachs Group Inc. on 
     NYSE Arca. In 2008, short sales averaged 37.5 percent of the 
     overall trading on the exchange in the three companies.
       To date, the commission hasn't announced any findings of 
     its investigation.
       Pollack, the former SEC regulator, wonders why.
       ``This isn't a trail of breadcrumbs; this audit trail is 
     lit up like an airport runway,'' he said. ``You can see it a 
     mile off. Subpoena e-mails. Find out who spread false rumors 
     and also shorted the stock and you've got your 
     manipulators.''

  Mr. KAUFMAN. The new SEC leadership has the opportunity to make the 
SEC a ``can do'' agency once more. The SEC is scheduled to meet on 
April 8 to discuss the uptick rule and abusive short selling. The Chair 
and commissioners should move quickly to adopt the uptick rule and a 
pre-borrow requirement.
  If not, Congress should do its part and direct the SEC to do that 
quickly.
  After yesterday's IG report and the Enforcement Division's response 
to it, I am even more convinced that SEC Chair Schapiro needs to grab 
the reins quickly at the SEC, and get back to standing up for investor 
interests to restore confidence in the markets. If the SEC won't do it, 
Congress should require them to do it.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Tennessee is recognized.
  Mr. ALEXANDER. I thank the Chair.
  (The remarks of Mr. Alexander pertaining to the introduction of S. 
659 are printed in today's Record under ``Statements on Introduced 
Bills and Joint Resolutions.'')
  The PRESIDING OFFICER. The Senator from Michigan is recognized.
  Ms. STABENOW. Mr. President, before the Senator from Tennessee 
leaves, I wish to say how much I enjoyed his comments, and I think no 
matter which side of the aisle we are on, we get up in the morning 
wanting to try to make a difference. So I appreciate his sentiments and 
I appreciate his comments very much, as it relates to what we hope we 
will all instill in our students and teachers and those who love our 
country. I appreciate his comments.

                          ____________________