[Congressional Record Volume 156, Number 106 (Monday, July 19, 2010)]
[Senate]
[Pages S5980-S5988]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                SMALL BUSINESS LENDING FUND ACT OF 2010

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of H.R. 5297, which the clerk will 
report by title.
  The assistant legislative clerk read as follows:

       A bill (H.R. 5297) to create the Small Business Lending 
     Fund Program to direct the Secretary of the Treasury to make 
     capital investments in eligible institutions in order to 
     increase the availability of credit for small businesses, to 
     amend the Internal Revenue Code of 1986 to provide tax 
     incentives for small business job creation, and for other 
     purposes.

  Pending:

       Reid (for Baucus/Landrieu) amendment No. 4402, in the 
     nature of a substitute.
       Reid amendment No. 4403 (to amendment No. 4402), of a 
     perfecting nature.
       Reid amendment No. 4404 (to amendment No. 4403), of a 
     perfecting nature.
       Reid amendment No. 4405 (to the language proposed to be 
     stricken by amendment No. 4402), to change the enactment 
     date.
       Reid amendment No. 4406 (to amendment No. 4405), of a 
     perfecting nature.
       Reid motion to commit the bill to the Committee on Finance 
     with instructions, Reid amendment No. 4407 (to the 
     instructions on the motion to commit), in the nature of a 
     substitute.
       Reid amendment No. 4408 (to the instructions (amendment No. 
     4407) of the motion to commit), to change the enactment date.
       Reid amendment No. 4409 (to amendment No. 4408), of a 
     perfecting nature.

  Mr. SESSIONS. Mr. President, I ask unanimous consent that I be 
allowed to speak as in morning business.
  The PRESIDING OFFICER (Mr. Kaufman.) Without objection, it is so 
ordered.


                            Kagan Nomination

  Mr. SESSIONS. Mr. President, I wish to speak on a very serious issue 
relating to the confirmation of Solicitor General Elena Kagan for the 
Supreme Court of the United States. As I was preparing for her 
hearings, I noted what struck me as a disturbing decision she had made 
as Solicitor General shortly after taking that position, in a case 
called Witt v. Department of the Air Force. In that case, a former 
member of an Air Force Reserve unit in Washington State sued the 
government to challenge the ``don't ask, don't tell'' law, which 
essentially says openly homosexual persons may not serve in the U.S. 
military. The case was dismissed by the district court, and the 
military was allowed to proceed with its policy. But when it was 
appealed to the Ninth Circuit, that very liberal court of appeals 
overturned the district court and said the case should go to trial and 
announced an unworkable legal test that the lower court must apply and 
that the government would have to meet for the ``don't ask, don't 
tell'' statute to survive constitutional challenge.
  After that unprecedented ruling, the Solicitor General's Office, then 
manned by the Bush administration personnel, immediately authorized an 
appeal to the full Ninth Circuit, en banc, and the government asked the 
full court to take a look at it and overturn the three-judge panel. The 
full court of appeals declined to do so, over strong objections from 
several judges on the Ninth Circuit who thought their colleagues had 
clearly gotten the case wrong. In fact, the First Circuit in the 
Northeast had already reached a different conclusion in a very similar 
case, and had upheld the statute.
  At that point, the government could have appealed the Ninth Circuit 
decision to the Supreme Court, as I think the Solicitor General's 
Office clearly was on track to do. First, they sought en banc review, 
and then they would seek interlocutory appeal to the Supreme Court. But 
as it happened, by

[[Page S5981]]

the time the case was ripe for appeal, the Obama administration had 
come into office and Ms. Kagan had become Solicitor General. She was 
now head of the office that makes this decision on whether to take 
cases to the courts of appeals or, if necessary, to the Supreme Court; 
the office that is charged with the great responsibility of defending 
before the Supreme Court the statutes passed by the United States 
Congress. Of course, don't ask, don't tell is a congressional statute, 
not a policy of the military. So it fell to her to decide whether to 
take the case to the Supreme Court. She refused.
  I practiced law for 20 years--15 as part of the Department of 
Justice, as a U.S. attorney for 12 years--and I think I can make some 
commonsense evaluation of the judgments the lawyers made in this 
litigation. Ms. Kagan, at the time she made this decision, had only 
been Solicitor General--had only served in the Department of Justice--
for 6 weeks or so.
  As I analyzed what I think happened, I asked some serious questions 
about why this Solicitor General failed to follow through on what 
appeared to be the direction of her predecessor. And I was struck by 
the distinct possibility that Ms. Kagan did not fulfill this 
fundamental responsibility of her office, which is to defend the 
statutes of the United States regardless of her personal policy views. 
So at the time of her confirmation hearing, just a couple of weeks ago, 
I asked her about this case and the facts that led up to it. I asked 
her to explain the decision, and I deliberately intended to give her 
time to explain it. Well, she took time, using notes for about the only 
time I saw in the hearing, and talked uninterrupted for about 10 
minutes to explain how it was that she made the decision.
  At the end of it, I thanked her for her answer and noted that I was 
going to have to review this because what she had done did not make 
good sense to me. I have to make a judgment. I am a Senator. I have to 
know whether the person who is being considered to sit on the highest 
Court of the land with a lifetime appointment--could serve 30, maybe 40 
years on the Court--whether they understand that officeholders have 
duties and responsibilities that they cannot just fail to discharge, 
that they must do?
  So I have conducted an examination, and I must say I am very troubled 
by what I have found about this case. I think the record shows that Ms. 
Kagan did not, in fact, fulfill her responsibilities in a good way and 
in a faithful way as Solicitor General and that she, in effect, 
violated a specific promise she made to the Judiciary Committee when 
she testified under oath during the hearing on her nomination a year or 
so ago to be Solicitor General. She had to be confirmed then and came 
before the committee.

  Before I go further, I wish to provide some background. It is widely 
known by many that Ms. Kagan is personally opposed to don't ask, don't 
tell. She has been opposed to it for some time. While she was dean at 
Harvard, she blocked the military recruiters from the campus career 
services office because of her opposition to don't ask, don't tell. She 
called don't ask, don't tell ``a moral injustice of the first order.'' 
She spoke at a protest of students who protested while a military 
recruiter was in the next building, and she changed the Harvard policy 
from admitting recruiters to the career services office to denying them 
admittance, without legal authority, contrary to the law Congress 
passed and on which I worked, to force universities to treat our 
military men and women who come to recruit on their campus with the 
same dignity and respect as they would treat anyone else from some law 
firm who makes millions of dollars. At the recent hearing she openly 
admitted to me that her views remain the same about this statute.
  When she came before the committee for the position of Solicitor 
General, she was specifically asked about this in written questions, in 
light of her strong opposition to this law. Congress passed three or 
four versions of the Solomon Amendment to finally require that colleges 
and universities treat our military on an equal basis, and some were 
forced to do so or lose Federal funding. She was specifically asked, in 
light of her strong opposition to this law, whether she would be able 
to defend it as the job of Solicitor General would require. This was 
not a mystery. We knew this matter was coming up through the courts of 
appeals and would be coming before the Solicitor General.
  She was flatly asked: If you are going to take this job, as you have 
been opposed to this statute, will you defend it as you are lawfully 
required to do? Only the Solicitor General can represent the U.S. in 
the Supreme Court. If the Solicitor General does not defend an act of 
Congress, who will? There is no one else. So it was a good question.
  She promised the committee under oath that she would, and she said 
that her ``role as Solicitor General would be to advance not my own 
views but the interests of the United States.'' Correctly stated.
  She went on to say that she was fully convinced that she could 
``represent all these interests with vigor, even when they conflict 
with my own opinions.'' She said her general approach to suits 
challenging a Federal law would be to make any ``reasonable arguments 
that could be made in its defense,'' and this would include 
``challenges to the statute involving the don't ask, don't tell 
policy.''
  A pretty specific promise. It was an important promise. I am sure had 
she not made that promise, even more people would not have voted for 
her confirmation.
  She went on to say that she would ``apply the usual strong 
presumption of constitutionality to that law as reinforced by the 
doctrine of judicial deference to legislation involving military 
matters.''
  As I mentioned earlier, it just so happened that immediately after 
she was confirmed it fell her lot to defend this very statute that she 
personally strongly opposed but that she had promised she would 
vigorously defend. She was given the opportunity to appeal to the 
Supreme Court from that terrible decision out of the Ninth Circuit, 
which refused to uphold don't ask, don't tell, and which ordered the 
military to go to trial in the middle of a war to justify the law under 
a newly-invented legal standard.
  Faced with that choice, Ms. Kagan refused to appeal, decided to let 
the Ninth Circuit decision stand, and allowed this case to be sent back 
down to go through a trial. Clearly, to me, the military's interest was 
to have the issue decided as a matter of law--that this is a lawful 
policy and that they were empowered to carry it out in a lawful manner.
  When I asked Ms. Kagan at her Supreme Court hearings recently why she 
blocked the Supreme Court review of the Witt case, she gave three 
reasons in her long answer. Some may have thought she gave a brilliant 
dissertation. She had notes, and she went through a long discussion.
  First, she said she concluded, after conferring with her colleagues, 
that it would be better to wait to appeal to the Supreme Court until 
after the trial, because a trial would build a better factual record of 
the case. She said once the facts were better developed, the government 
might be in a better position before the Supreme Court.
  Second, she said that allowing the case to go back to the district 
court would help the government in a future appeal because it would be 
able to show the Supreme Court just how invasive and ``strange'' were 
the demands of the Ninth Circuit that were being placed on the 
government in defense of the law.
  I will say one thing: The Ninth Circuit demands were, indeed, strange 
and were utterly unworkable, as I will show.
  Third, she said an appeal in the Witt case would have been 
``interlocutory;'' that is, an appeal before the case had come to an 
end and before a final judgment had been rendered in the case. The 
Supreme Court prefers not to hear these kinds of appeals.
  None of these explanations are credible. It is true that appellate 
courts, including the Supreme Court, prefer to hear appeals at the end 
of the case rather than in the middle, but that is a decision the Court 
can make for itself. It is not something the Solicitor General has to 
decide on the Court's behalf. And that consideration was clearly 
outweighed in this case.
  I will note parenthetically that when the Third Circuit ruled on the 
Solomon Amendment, which required Harvard

[[Page S5982]]

and other law schools to allow the military equal access to recruit on 
campus, they took that as an interlocutory appeal and reversed the 
Third Circuit. That is exactly what should have been done here. The 
government had asked for an interlocutory appeal to the Supreme Court 
from the Third Circuit ruling that affected Harvard, and the Supreme 
Court agreed. It was a legal question, ripe for decision, and they 
decided the case. That is what should have happened.
  Here we already had a split among the courts of appeals on this 
question. The First Circuit had already ruled as a matter of law for 
the government. The Ninth Circuit ruling squarely conflicted with the 
First Circuit, and it was also at odds with decisions from four other 
circuits on similar principles. Here we also had an opinion from the 
Ninth Circuit that presented clean questions of law--an opinion that 
had dramatically altered the legal landscape in 40 percent of the 
United States, because the Ninth Circuit encompasses 40 percent of the 
United States, and that was proposing to subject the military to an 
invasive trial process, while fighting a war, to defend the application 
of a nationwide military policy to an individual person.
  Ms. Kagan's second explanation--that letting the case go to trial 
would allow the government to show just how painful a trial would be--
cannot be given serious consideration. The Ninth Circuit opinion was 
very clear about what the government would have to show in order for 
the don't ask, don't tell law to survive this lawsuit. In other words, 
one didn't have to go through all these steps at the lower court and 
show how dramatically disruptive it would be. The Court had set forth 
explicitly what would happen. It is easy to show the Supreme Court why 
this is not a workable approach.
  The Ninth Circuit made it very clear in their opinion that the 
government was going to have to justify the application of don't ask, 
don't tell to this specific plaintiff--not justify the law in general 
but to justify its application to this specific plaintiff--to prove 
that this specific plaintiff was going to harm the military if she were 
allowed to remain in the Air Force. It was also clear that such a trial 
was going to be disruptive to the military and that it would harm the 
unit cohesion Congress had set out to protect when it passed the don't 
ask, don't tell law in 1994.
  I am not alone in reaching this conclusion. Her predecessors in the 
Department of Justice and in the Solicitor General's Office, the office 
she took over, also knew the court orders did not make sense. That is 
why they immediately asked the full Ninth Circuit to reconsider en banc 
the three-judge panel's ruling when it first came down in 2008.
  They said in their brief that the Ninth Circuit decision ``creates an 
inter-circuit split.'' That means the First Circuit had held 
differently. The Ninth Circuit held a different way. We had a split of 
circuits which is something the Supreme Court considers when they 
decide to take a case.

  They went on to say it created ``a conflict with Supreme Court 
precedent, and an unworkable rule that cannot be implemented without 
disrupting the military.''
  The Ninth Circuit's decision, they went on to say, made the 
constitutionality of a Federal law setting military policy for the 
entire Nation ``depend on case-by-case surveys, taken by lawyers, of 
the troops in a particular plaintiff's unit.'' They went on to say that 
immediate review was ``needed now to prevent this unprecedented and 
disruptive process.'' That is exactly correct. The lawyers who made 
that argument were clearly correct.
  Most importantly, Ms. Kagan's decision to send this case back for 
trial and not appeal doesn't make any sense because she knew a trial 
was going to be massively disruptive to the military. I have studied 
the record of the case on remand to the district court, and I have seen 
what has been going on since it was sent back to be tried on an 
individual plaintiff basis. The lawyers for the government are 
struggling to defend the law under these difficult circumstances. From 
the very first hearing before the district court, these lawyers, career 
lawyers, professionals in the Department of Justice, are asking the 
court not to allow discovery, not to allow the plaintiff to depose the 
soldiers and plow through all these issues in the military unit.
  Here is what the career attorney for the Department of Justice said 
at the first hearing before the district judge after the case went back 
down for this trial:

       If we commence with discovery into the specific facts of 
     this case by looking at what unit members think, we are 
     threatening--we are jeopardizing the unit morale and cohesion 
     . . . that the Ninth Circuit said the government--the 
     military--has an important government interest in.
       So the military is in a bit of a catch-22. By proceeding to 
     discovery, we may well have to sacrifice our important 
     government interest.

  Remember, Ms. Kagan told the Judiciary Committee--she told us just a 
few weeks ago--that ``building a factual record'' would be good for the 
government's case. Remember? I just went through that. That is what she 
said--it would be good. We would have a better prospect on appeal 
somehow. Here, the career lawyers trying to defend the military are 
saying that building a factual record is bad for the government because 
the discovery process will threaten the military's interest in unit 
cohesion.
  As a matter of fact, I will say as an aside that I think it is quite 
clear that if the Ninth Circuit theory of law were to be upheld, the 
``don't ask, don't tell'' policy would be put in the situation where it 
would be difficult, if not impossible, to enforce because everybody 
dismissed under that policy would then be able to have a big trial. It 
could go on, as this one has, for months, and they would be able to 
call all the unit members to ask their opinion about what they thought 
about this, that, and the other, even about their personal sexual 
activities, perhaps. This is not a practical solution. It is bad for 
the government. How Ms. Kagan could now say it would be good for the 
case, I do not know.
  So clearly the career lawyer is right. The plaintiff in this case, 
who is represented by lawyers from the ACLU, has asked for and received 
access to the personnel records of the plaintiff's military unit. So 
now the ACLU has the personnel records of the entire unit, it appears. 
They have demanded depositions with other soldiers who served with the 
plaintiff before she was separated from the military. They have 
demanded the right to interview soldiers about their private lives, 
their personal views of their former colleague, and their private 
thoughts about sexuality.
  The district court has wrongly, I believe--well, I will just say it 
this way: The district court has allowed it at every turn because the 
district court says this is the only way to answer the questions the 
Ninth Circuit ordered them to answer before a person could be dismissed 
under this provision of law.
  But this is not just a case of bad--astonishingly bad--legal 
judgment. I do not think Ms. Kagan accidentally sent her client, the 
U.S. Air Force, into a litigator's lion's den. I do not think it was an 
accident. I believe she understood this was going to happen and, for 
some reason, she wanted it to happen.
  In the very first hearing the district judge held after Ms. Kagan 
refused to appeal to the Supreme Court and the case was sent back for 
trial, the plaintiff's lawyers argued they needed to get all this 
discovery in the case, and they made a very interesting statement to 
the district judge. They said this:

       [T]he government just doesn't want any discovery. I have 
     heard that message from the government clearly--loud and 
     clear. [We] were asked to meet with the Solicitor General of 
     the United States in April, and we heard that message loud 
     and clear that discovery is a big problem; but we never heard 
     any specifics as to why, and it boils down to they don't like 
     the Ninth Circuit's decision.

  So apparently back in April 2009, Ms. Kagan acknowledged what I think 
is indisputable: that discovery of this kind, where soldiers are 
deposed and asked about their personal views and activities, would be 
disruptive to the military and bad for her client, the Air Force. That 
is just undisputable. She was the Solicitor General then and 
acknowledged that.
  Her decision to block an appeal to the Supreme Court was finalized in 
May of 2009. So before she made that decision, it does appear Ms. Kagan 
met with the opposing counsel in the case--the ACLU lawyers--and told 
them that ``discovery is a big problem.'' In other words, she told 
these ACLU lawyers for

[[Page S5983]]

the other side, who were trying to attack the military policy, that 
developing a factual record in this case would be bad for the 
government. But she told us at the committee that she thought it was 
going to be good for the government.
  She knew in April of 2009 that a trial would be harmful to the 
interests of her client, but she made sure the case went back for a 
trial anyway. She knew that discovery would be harmful to the 
government's interests, but she told the Judiciary Committee, just 2 
weeks ago, under oath, that she decided not to allow an appeal to the 
Supreme Court because she thought ``it would be better to go to the 
Supreme Court with a fuller record'' that would be developed at trial.
  I do not know how to reconcile her testimony with the record in the 
case. I do not think it can be reconciled.
  During this nomination process, I have expressed my concern about Ms. 
Kagan's record as a political lawyer--someone who has advanced a 
specific agenda as an adviser in the White House and someone who says 
she was ``channeling'' the Justice she clerked for on the Supreme Court 
when she encouraged him not to hear certain cases because she did not 
think a majority of the Court would rule the way she and her boss would 
like. But I do think this big decision she made as Solicitor General 
is, in many ways, more concrete proof--and from just a few months ago--
of the reason for our concerns that this nominee will have 
difficulties, and maybe find it impossible, to set aside her political 
views and decide cases objectively and fairly.
  Faced with the hard task and the solemn responsibility of defending 
the laws of the United States--after having promised the Judiciary 
Committee under oath that she would be able to uphold that 
responsibility, even as to this specific law she personally opposes--I 
am forced to conclude that Ms. Kagan did not live up to that promise 
and did not fulfill a solemn duty of the Solicitor General of the 
United States.
  This is not a statute, in my view, that is likely to be overturned by 
the Supreme Court. In fact, we know the law's opponents, in another 
case, did not want to see their case be appealed to the Supreme Court. 
Why? They felt they would lose, in my opinion.
  Let me talk about duty. Maybe that is a bit old-fashioned today. But 
Ms. Kagan should not have had to make a promise before the committee 
that she would defend this law. It is a duty of every Solicitor General 
to defend the laws of the United States, whether they like them or not, 
whether they think it is a good idea or not. Who cares what they think? 
They have a responsibility. They are confirmed to a position high in 
the Department of Justice--the position that empowers her to appear 
before the Supreme Court and state the position of the United States. 
Indeed, the Solicitor General's job has often been called the greatest 
lawyer job in the world. Why? Because the Solicitor General has the 
honor to stand before those Justices and say: I represent the United 
States of America. What greater honor can someone have than that, to 
represent this great Nation before the Nation's highest Court? Much is 
expected of them.
  So I say she did not have to make a promise to defend this statute. 
It was her duty, whether she liked it or not. And it does appear--I do 
not see how we can draw any other conclusion--that she did not like 
this law and that her strategy in the case was to not get a definitive 
Supreme Court ruling on the constitutionality of the statute and to 
allow these proceedings to be dragged out in lower court and to maybe 
influence Congress as to whether it repeals this act. I do not know. 
Certainly, she despised this law. She opposed it. She wrote briefs at 
Harvard attacking the Solomon amendment that said that Harvard Law 
School had to give the military equal treatment on campus and that 
access could not be denied simply because she did not agree with don't 
ask, don't tell, which is what she was doing at Harvard.
  The result of her decision showed she was willing to allow the ACLU 
to prowl through the our airmen and soldiers in units throughout the 
Ninth Circuit--covering over 40 percent of America--turning those units 
upside down, harming the discipline and order of those units and 
damaging to the military. I do not see how it can be considered 
otherwise.
  I think it was an abdication of her duty. We are Senators here. We 
are elected. We have one vote. And I know our nominee was articulate 
and had good humor and many thought she did very well with her 
testimony. I was not so impressed. But I do believe you have to fulfill 
your duty and your responsibility, particularly after you have 
explicitly promised to do so with regard to this specific case, and 
defend the law even when it runs contrary to one's own personal views.
  What if the person is now confirmed to the bench for 30, 35 years? If 
she were to serve as long as the judge she is replacing, I think she 
would serve 38 years on the Supreme Court. We have to know before they 
are launched forth on the Court that the nominee has the ability and 
the character and the integrity to defend the legal system in a proper 
and effective way.
  This nomination is further complicated by the fact that our nominee 
has no experience in the real practice of law. Our nominee has never 
tried a case, never stood before a jury, to my knowledge, never cross-
examined a witness in a trial. She never had to deal with a judge who 
is not feeling good, maybe irritable one day, or dealing with lawyers 
on the other side who are clever and tough. That is something you 
learn. She has never been a judge. Well, they say, that is not 
necessary; some great judges haven't been judges. Of course, that is 
true, but she has never been a judge or a real lawyer. That bothers me. 
Then when I see the kinds of things I am seeing here, it makes me 
pause, frankly. I hope all of my colleagues will look at this and take 
it seriously.

  There are other examples of positions taken by this nominee as 
Solicitor General and at Harvard that are very troubling. I think the 
evidence shows a lack of a clear understanding of the importance of the 
rule of law in our country. President Obama has said he wants judges 
with empathy. I don't know what he means by empathy. That is not a 
legal standard. It is something other than law. It is more akin to 
politics or bias than law. He has said he wants a nominee who will 
demonstrate that they, in the course of their duties, will have a 
broader vision for what America should be. Does that mean a judge gets 
to manipulate the meanings of words in statutes and in our Constitution 
to promote this vision that they have? Were they elected to promote any 
vision? I don't think so. I think a judge should be a neutral umpire 
who puts on that robe to evidence a commitment to impartiality and call 
the facts of the case as they see them, faithfully following the law 
and faithfully finding the facts of the case. That is what a judge is 
all about.
  I am very concerned that our nominee, whose background has been more 
political. Her testimony to me was too much akin to White House spin 
than to a clear and intellectually honest explanation of what the law 
and facts are in complicated situations. I didn't feel good about it. 
Maybe others did, but I did not.
  So those are concerns I have. I hope my colleagues will specifically 
look at the don't ask, don't tell matter. I think it raises questions 
about whether the nominee should be confirmed.
  I yield the floor and note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. REED. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                    Unemployment Insurance Benefits

  Mr. REED. Mr. President, we are seeing over the last 12 months a slow 
recovery in our job market. In the last 6 months, we have seen that 
accelerate but not sufficiently to reduce unemployment to anything 
comparable to a full employment economy. This year, so far, however, we 
have generated 600,000 jobs in the private sector. That is in sharp 
contrast to January of 2009 when President Obama took office and when 
we were losing 700,000 jobs a month. But despite this improvement in 
the job market, we have a long way to go.
  It is particularly troubling to be, once again, anticipating the vote 
tomorrow on the extension of unemployment benefits. These benefits 
lapsed

[[Page S5984]]

weeks ago. Meanwhile, millions of Americans are without access to 
unemployment funds--the insurance funds they paid each week out of 
their daily wages for the time they hoped would never come but has 
come--that they could rely upon for some support as they look for work.
  In Rhode Island, the unemployment rate is 12 percent--absolutely 
horrendous. We are seeing more and more of this unemployment being long 
term, not a temporary situation. Nearly half--45.5 percent--of those 
unemployed have been out of work for more than 6 months, and in those 6 
months, the excess savings one might have, the ability to cut a few 
corners to make it week by week, are less and less effective in simply 
keeping the lights on and keeping the family together. Then when you 
take away the unemployment compensation, people are, frankly, becoming 
desperate.
  Yet many on the other side are completely indifferent to this. They 
say it is not their problem. Well, it is their problem. It is our 
problem. If we cannot do this, then we are failing in a basic function 
which is to provide support for Americans in crisis, and that is what 
we must do. People are looking for work. The average individual has 
been looking for work for 35 weeks. That is almost a year, or a big 
part of a year. Yet, in the midst of this economic downturn--with 14.6 
million unemployed Americans--my colleagues on the other side have 
forced us to go through procedural hoops to get a vote on an 
unemployment compensation extension.
  The Senate has failed on three occasions to pass this extension. It 
is not because there is not a majority of Senators who want to, but 
because procedurally, we need 60 votes to end debate and vote on the 
measure. We have let this program lapse for short periods and now it 
has been lapsed since June 2, and that is unacceptable. There is no 
other word for it other than obstruction--stopping something that has 
been done routinely on a bipartisan basis in every major job recession 
in this country in our lifetime. This should be a simple bipartisan 
endeavor.
  George W. Bush had a period of time where we had a recession in the 
job market and we, on a bipartisan basis, extended unemployment 
insurance. There were no repeated delays, stretching it out, only 2-
month extensions or 3-month extensions to be considered. It was done 
because we had to help Americans who needed the help and who had 
contributed to the fund through their unemployment compensation 
insurance. We have never failed to extend unemployment compensation 
while the unemployment rate was at least 7.4 percent. Today, if your 
State has 7.4 percent, you are in recovery. You are in great shape. We 
have 12 percent in Rhode Island. If I go around the country, there are 
too many States such as Rhode Island, with 10, 11, 12 percent 
unemployment. The national unemployment rate is 9.5 percent. So this is 
an historical anomaly. We have routinely, on a bipartisan basis, 
extended unemployment compensation as long as the unemployment rate has 
been at least 7.4 percent. But now, in the midst of a much worse 
national economic crisis, most of my colleagues are simply indifferent 
to it. I am hopeful tomorrow we will rally at least two who recognize 
the need to respond to the needs of their constituents.
  We have extended it for much longer periods of time than the current 
period. In the 1970s, under Presidents Ford and Carter--again, through 
two Presidents, one Republican, one Democrat--3 years and 1 month of 
extended unemployment benefits. In the 1980s under President Reagan, 
yes, we extended unemployment compensation benefits without paying for 
it under Ronald Reagan on a bipartisan basis to help Americans for 2 
years and 10 months. In the 1990s, under President Bush, George Herbert 
Walker Bush and President Clinton, 2 years and 6 months. So we are 
hardly at the point where these benefits have gone on so long that they 
are intolerable.
  Again, routinely we have done this on a bipartisan basis, Republican 
Presidents, Democratic Presidents, Republican Congresses, Democratic 
Congresses. What I would argue has changed is our colleagues on the 
other side. Now we are going through another procedural vote and at the 
end of the day, on the final merits, this could pass by 75, 80, 90 
votes, because no one wants to be accused of not extending unemployment 
benefits. But this whole procedural strategy of delay after delay after 
delay effectively has denied millions of people not just the dollars, 
which are important, but the small sense of security that they can rely 
on these funds, that there is someplace they can get help. In Rhode 
Island, the average weekly benefit is $360. They can get roughly $360 a 
week to feed their family, to provide for the essentials in life. When 
that is stripped away, they lose more than just $360; they lose the 
sense that there is anything out there that is going to help.
  Beyond this procedural delay, some of my colleagues are arguing: 
Well, the reason we don't want to give unemployment compensation is it 
is a disincentive to work. I say $360 a week is not a disincentive for 
people to work who have worked all of their lives, making much more 
than that, who are desperate to work. The reality is that for every 
worker unemployed today who is out there looking around, there are not 
the jobs. In fact, there are five unemployed workers for every 
available job. This is not a situation where they are sort of sifting 
through and saying, Well, I don't like that work; that is too far for 
me to go. Talk to your neighbors, as we all do. They will take almost 
anything to get back in the workforce, and just to make more than, in 
Rhode Island, $360 a week. So that argument is disingenuous, but it has 
been raised here as if it is the gospel. It is not.
  We are in a deep economic crisis. Most of it is the result of 
policies that my colleagues enthusiastically supported: deep tax cuts 
to benefit, because of the nature of the income tax, the wealthiest 
Americans; more than low-income Americans. Two wars unfunded. In fact, 
I think this is probably the first time in the history of this country 
where we cut taxes in a time of war rather than trying to pay for these 
wars. The largest expansion of an entitlement program--Medicare Part 
D--in the history of the country since the 1960s, unpaid for. I could 
go on and on and on. That has led to a myriad of other policies--lax 
regulation; inattention to the lack of innovation in our country; the 
looking on as other countries such as China and others have taken bold 
steps in terms of infrastructure construction; the development of new 
technologies, including alternate energy and high-speed electric rail 
transportation--the Bush administration sort of casually tended to 
ignore it.
  I don't think anything indicates clearly the priorities of that side 
and this side. We have been struggling for months to try to pass an 
extension of unemployment compensation, but being told we have to pay 
for it. In the same breath, our colleagues say, But we have to extend 
the Bush tax cuts, including the estate tax cuts, without paying for 
them. We can't help people struggling to find work with $360 a week, 
but we can help multibillionaires with their estate taxes. I would 
argue that if you want to invest in productivity in America, help 
working people get jobs and work, and they will pay their taxes, they 
will work hard, they will contribute to the community.
  Now we have to deal with the deficit, but the notion that the $34 
billion we are talking about today in unemployment compensation is 
going to rank with the $3.28 trillion that these Bush tax extensions 
will cost the country it is not even apples and oranges. Literally and 
ideologically we can't pay for tax cuts, yet the deficit is the most 
important problem we face. It doesn't make sense, and it particularly 
doesn't make sense to Americans who are out there desperately looking 
for work.
  Again, when you look at where this deficit came from, I remember in 
the 1990s when we stood up as Democrats without any Republican help and 
passed an economic program that resulted in not only deficit reduction 
but a $236 billion surplus. It resulted in not only economic growth but 
strong employment growth through the nineties.

  When President George W. Bush took office, he was looking at a 
significant projected surplus. He was looking at solid employment 
numbers and a growing, expanding economy. In the 8 years he was in 
office, he took that surplus and not only turned it into a deficit, but 
he increased the national debt more in 8 years than had been done in

[[Page S5985]]

the previous history of the country. Then, again, to have my colleagues 
on the other side suddenly discover that deficits are important--it 
wasn't important enough for them in the nineties to stand with us and 
vote to reduce the deficit, balance the budget, and raise the surplus. 
It wasn't important enough for them in the Bush administration, which 
adopted programs and policies to undercut that fiscal stability and put 
us into a precipitous economic collapse--and now it is important.
  It is important, but when we talk about this issue of unemployment 
compensation, it is central to this debate. Robert Bixby, president of 
the Concord Coalition, which has been, throughout the years, one of the 
most consistent in terms of fiscal responsibility, put it well when he 
said:

       As a deficit hawk, I wouldn't worry about extending 
     unemployment benefits. It is not going to add to the long-
     term structural deficit, and it does address a serious need. 
     I just feel like unemployment benefits wandered onto the 
     wrong street corner at the wrong time, and now they are 
     getting mugged.

  That is what is going on. They are mugging a program the American 
people need. It is close at hand. It can invoke this notion of 
responsible deficit reduction. Where was all this responsible deficit 
reduction talk when they were proposing Medicare Part D, which is a 
huge benefit to the pharmaceutical industry--without any payments, a 
lot of expensive entitlement, which adds to the structural deficit, 
because year in and year out, when you get to be 65 years old, you 
qualify for Part D.
  Unemployment benefits are countercyclical--people pay into it, it 
builds up the trust funds in the States, and then when you meet a point 
at which you need it, it should be there. It should be there now.
  The other point that is important to make is, for every dollar of 
unemployment benefits there is $1.90 of economic activity. This is a 
stimulus measure too. At a time when we are seeing a fragile recovery, 
we need to put more muscle behind the recovery. Not only are we giving 
people a chance to make ends meet, when they take their unemployment 
compensation and other resources and go into the marketplace, it 
provides an increase in economic activity.
  In fact, if we don't have increased economic activity, there is a 
danger this recovery will be very slow--painfully slow--and that would 
be unfortunate, because what we measure in terms of economic recovery 
is measured in American families by the opportunities to send their 
children to school, the opportunities to provide more for their 
families. If that is inhibited over months and months, then those who 
suffer are the American families.
  There are other aspects of this. For example, the Joint Economic 
Committee estimated that by the end of 2010--this year--290,000 
unemployed disabled workers--these are people who work but have a 
disability--will exhaust their benefits. If these individuals choose to 
drop out of the labor market and go onto the Social Security disability 
rolls, go through the process of being qualified and approved for 
disability, over the lifetime, this could result in $24.2 billion in 
costs, contrasted to the $721 million this year that this group would 
receive in extended benefits.
  It is a simple sort of issue. Do we want to keep people in the 
workforce--at least keep them looking for work with unemployment 
benefits--or do we want them to say: I will give up and declare that I 
can't work again, and I will go see if my disability can be covered by 
Social Security disability insurance and, for the rest of my life, I 
will collect my Social Security disability, even though I would really 
like to work. That is another aspect of this problem.
  We have a challenge tomorrow, when we greet our new colleague from 
West Virginia, to stand and extend unemployment benefits. Once again, 
if we look at history, this should have been done weeks ago on a 
strong, bipartisan basis, putting aside the relative politics of the 
moment and concentrating on what we should do for the American people. 
Tomorrow we will have a chance to do that, and I hope we do.
  With that, I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Ms. LANDRIEU. 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 Louisiana.
  Ms. LANDRIEU. Mr. President, I wish to speak for about 5 or 10 
minutes--not very long--about an important matter before the Senate.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. LANDRIEU. Mr. President, I am joined by my colleague from Oregon, 
Mr. Merkley, who has been a wonderful supporter of the small business 
package and as a member of the Banking Committee has been very 
instrumental in the shaping of the jobs bill 3, the small business 
package, that we will be debating and hopefully voting on this week.
  I wish to say first that I appreciate all the work the members of the 
Small Business Committee have done, both Ranking Member Snowe and all 
the members of the committee, as well as the members of the Finance 
Committee who worked very hard to put a package together and the work 
that has come from the White House and Treasury to build a package that 
is paid for, fiscally responsible, and meaningful for small business in 
America.
  There are many important pieces of the package, but one of the most 
significant in this very tough time for small businesses, Mr. 
President, which you know because I am sure you hear from your small 
businesses in Delaware, is that they would like some tax relief, if 
possible. They understand we are in a deficit. They understand it is 
difficult to provide tax relief, it is also difficult to cut spending, 
but they would like to see us respond with some targeted tax cuts to 
small business.
  This package, I am happy to say, that Leader Reid will be presenting 
in the next 24 to 48 hours has $12 billion in targeted, specific tax 
cuts for small businesses in America, from accelerated depreciation to 
zero capital gains for investments made in small businesses in the next 
year, incentives to invest, not in the big businesses, not in the 
businesses on Wall Street but in the businesses that are on Main Street 
in all our States and all our towns, whether they be large cities or 
smaller cities or tiny villages throughout, whether it is Delaware or 
Louisiana, Texas or New York I am pleased a centerpiece of this 
legislation is targeted, substantial tax cuts for business.
  The other very interesting piece of this bill is a whole series of 
things on which the small business community has worked together in a 
very bipartisan fashion for strengthening programs within the SBA, the 
Small Business Administration; it is not a very big agency, it is a 
small agency, but it can be muscular. If it is provided the right tools 
and with the right shaping of those muscles, it can be actually very 
effective in lifting small businesses to a better place.
  With Senator Snowe's help and support, we have managed to come out 
with several provisions, one of which is the doubling of the loan 
limits for the 504 and 7(a) programs, which together have the potential 
to leverage about $30 billion in lending. We have reduced the fees--
eliminated the fees, actually, for banks. We have increased the 
guarantee from 75 percent to 90 percent. We have expanded the amount of 
loans, the limit, people can ask for to provide greater access to 
capital. It is widely popular with the small business associations, and 
we have their broad support.
  Again, small businesses in America have seen their credit lines 
shrinking or evaporated. They have seen their credit card companies 
charging higher interest rates and demanding full payment on 
outstanding balances.
  It is important for us to recognize that this recession is not going 
to end without some businesses hiring again. They do not hire on wishes 
and prayers. They hire on bottom-line finances and the hope that things 
will get better. Both are important--bottom line finances, access to 
capital, and the hope that things will be better. That is what this 
bill brings--bottom line support and hope that things can be better.
  That is a big portion of our bill. Included in that is a very 
important component of increasing exports. When

[[Page S5986]]

people say in the surveys: We need to increase demand, I agree. One way 
we can increase demand is to open exporting opportunities for our small 
businesses.
  I do not have it with me, but I have used it many times, a chart that 
shows only a small sliver that represents small businesses that export. 
Most of our products are exported and services sold by big companies. 
When people say to me: Senator, what can the Federal Government do to 
help open markets or to give us more customers, one thing we can do is 
to strengthen programs at the Federal level and the State level that 
give technical assistance and support for our small businesses to 
export. It is very important to Senator Snowe. It is very important to 
Senator LeMieux from Florida. It is very important to Senator Klobuchar 
from Minnesota, who has been a great advocate for this provision for 
exports, and others as well. That is in the bill.
  The final piece I am going to speak about--and then I will turn it 
over to the Senator from Oregon, who has worked so hard on this 
particular proposal--is, in addition to the $12 billion in tax cuts 
targeted for small businesses in America, in addition to the 
strengthening of the SBA direct lending programs that are so important 
to so many colleagues on both sides of the aisle, there is a $30 
billion lending program to small businesses. It is not a government 
program but a private sector-based lending program, using the great and 
powerful network of our community bankers. Not our big banks, not the 
Wall Street banks, not the hedge fund managers about whom we have heard 
so much--usually bad--but our own very familiar partners at the local 
level, our community banks.
  This program would take $30 billion and basically pass it through to 
small businesses that are looking for capital. I have people come into 
my office, representing hundreds of small businesses, saying: Senator, 
we don't have the capital we need to expand, and we have been in 
business X number of years. If I could just get a loan for $5 million 
or $10 million or get a capital line for $20 million, I could expand my 
business.
  If we do not find a way to get more money into the hands of small 
businesses--this is not a banking program. It is not like the old 
bailout program we did for banks. This is about a liftup, a helping 
hand to small businesses in America.
  With that program, amazingly, it encourages more lending to small 
businesses, it is voluntary, and it actually makes money for the 
Federal Treasury. Again, it is voluntary. It is available to all small 
banks in good standing to encourage them to use this capital to lend to 
small businesses.
  I am going to turn it over to the Senator from Oregon. Before I do, I 
would like to call attention to the many strong endorsements we have 
gotten, starting with the Conference of State Bank Supervisors:

       The proposals--the Small Business Lending Fund and the 
     State Small Business Credit Initiative--will provide much-
     needed access to capital support small business lending, the 
     lifeblood of our national economy.

  That is Neil Milner, president and CEO of that organization.
  I will read another one from John Arensmeyer, founder and CEO of 
Small Business Majority:

       The Small Business Lending Fund will create a program that 
     will provide up to $30 billion in capital to smaller banks to 
     spur lending to small businesses and help create new jobs. 
     There's no ``silver bullet'' that will put small business 
     owners out of the financial hole . . . but these initiatives 
     are an important piece of the overall plan to help revive our 
     struggling economy. . . .

  Finally, from Michael Grant, president of the National Bankers 
Association:

       The Obama Administration--continuing its efforts to lift 
     the country out of a two-year recession--has hit a home run 
     with its proposed $30 billion Small Business Lending Fund. 
     This is not a bailout to small business and medium-sized 
     banks; it is, instead, a true investment in a brighter future 
     for America's working class.

  Again, I turn it over to the Senator from Oregon. I thank him very 
much for his help in shaping this proposal, expanding it, and promoting 
it. It promotes itself based on its merits. We are always happy to have 
his voice enter this debate.
  I yield the floor for my colleague.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. MERKLEY. Mr. President, I am delighted to partner with my 
colleague from Louisiana. Senator Landrieu has been a passionate and 
effective advocate for small business across this country. She has 
worked incredibly hard to drive through this small business jobs 
legislation, recognizing that the success of our economy is going to 
rise or fall on the success of our small businesses.
  That is what brings us together tonight. We have come to talk about 
the small business lending fund, which is an essential component of 
assisting our small businesses.
  Small businesses employ one-half of our Nation's workforce. However, 
less than one-third of small businesses today are reporting their 
credit needs are being met. Indeed, 59 percent now rely on credit cards 
to finance their daily operations. That is an increase of about 15 
percent from where we were at the end of 2009.
  I can tell my colleagues that at every townhall meeting I hold, folks 
stand to talk about how their credit lines have been cut or they have a 
business opportunity for which they normally could easily get a loan 
from a longstanding banking partner, but they are not able to get that 
loan. Often, the reason the banks cannot make the loan is because they 
are at their leverage limit. There are legal limits for every dollar 
they hold, how many can they lend out. If they are at that limit, they 
cannot make a new loan no matter how good the opportunity.
  This is a losing situation because our community banks are right on 
Main Street. They see and know the opportunities. They understand the 
capabilities of individual entrepreneurs and managers, so putting that 
expertise to work is going to fuel job growth in this Nation. But we 
can't put it to work if the banks are unable to lend or are at their 
leverage limit.

  The Small Business Lending Fund will proceed to inject liquidity into 
our economy, and that is like oil into an engine--a job-creating 
engine--to the tune of as much as $300 billion in additional lending to 
small businesses on Main Street, and this will occur under the Small 
Business Lending Fund without any dollar of subsidy from the U.S. 
taxpayer.
  Indeed, the Congressional Budget Office has studied this proposal and 
has recognized and reported that it will save $1 billion to taxpayers 
over the next 10 years, and that is just from the earnings of the 
payments that the banks will make back to the funds that are injected 
as additional capital into our community banks.
  But think about this: Every small business that is able to see an 
opportunity because it can gain access to credit is also going to make 
money on that proposition. When they make money, they pay additional 
taxes. CBO doesn't score the additional taxes, but recognize that in 
addition to the $1 billion of savings on interest payments, there will 
be all the benefits that will flow from additional jobs--additional 
taxes paid on the income from those jobs, additional profits to small 
business, additional revenue from those profits. So the real return is 
even greater to the taxpayer.
  But most importantly we are creating jobs, and that is a return that 
is hard to measure. When a family has a job, they can diminish their 
reliance on every other program. The most important foundation of a 
family is a good job, and that is what the Small Business Lending Fund 
is all about. It does indeed have prominent endorsements, as my 
colleague mentioned: the Independent Community Bankers of America, 
representing 5,000 community banks on Main Street which are having to 
bypass the opportunities they are seeing because they are at their 
leverage limit. Recognize that they can make loans, which is good for 
them, good for small businesses, good for their communities and 
certainly great for the families who get the additional jobs. Also, the 
National Bankers Association, the National Small Business Association, 
the National Association for the Self-Employed, the Small Business 
Majority, and so on and so forth.
  Let me give one example from Oregon. John and his business partner 
have owned a small retail store in Portland, OR, for over 25 years. It 
is a store I have visited often. Because of lackluster consumer 
spending, John has made a lot of sacrifices to keep that business 
afloat during this recession. He has had to reduce his staff, cut

[[Page S5987]]

the hours the shop is open, and he and others have had to take pay 
cuts. But to add insult to injury, his bank threatened to drop his line 
of credit.
  John has never missed a payment, never had a late payment, but in 
this process of reducing exposure or reducing the required leverage 
limits, banks are cutting lines of credit, and John's line was being 
cut. Finally, after negotiation, they agreed to renew his line of 
credit every 90 days but every 90 days charge a fee, and on many 
occasions to raise the interest rate.
  He has been looking for a new lender who will work with him and not 
against him, but that is hard to find in this economy, where lender 
after lender is affected by the same constraints. This story is 
repeated, different versions, hundreds of times throughout Oregon, and 
thousands of times throughout this Nation.
  How would a Small Business Lending Fund work? Essentially, it 
capitalizes the community banks, so with that additional capital they 
can make more loans. If they get more loans out the door, then the 
repayment rate--the dividends they would pay back to the taxpayers--is 
reduced to as low as 1 percent. If they do not get loans out the door, 
the payments go up to as high as 7 percent. So there is a significant 
incentive to take these funds, after a bank is recapitalized, and get 
them out the door.
  That addresses several of the challenges folks have raised. There has 
been concern about banks that might hoard cash and say: Well, we will 
prepare in case some assets are devalued in the future or that banks 
might say: We will wait until a better time, when everything is surging 
forward. Well, things won't surge forward unless we get lending out to 
small businesses. That is why this structure of incentives is critical.
  The banks that will qualify are banks that have CAMELS ratings, which 
means capital adequacy, asset quality, management, earnings, liquidity, 
and sensitivity--or exposure to market risk. So a bank that is in deep 
trouble isn't going to be in a position to take advantage of this. But 
banks that are sound and healthy will, and therefore this makes it a 
good investment, an investment that has significant return to the 
taxpayer but, more importantly, a big return to our communities.
  I would also note that this will go hand in hand with the program to 
make additional grants to State-based small business programs. My 
colleagues, Senators Levin and Warner, have been very involved in 
helping to forge that program. These things go together. Community 
banks on Main Street will see opportunities and State-based small 
business programs will see opportunities. They probably will see the 
same opportunities. These will work together to take us out of this 
recession.
  I wish to read a note that I received:

       Dear Senator Merkley: Overall, I believe the majority of 
     financial support under TARP went to the large investment 
     banks, insurers, FNMA, FHLMC and other giant institutions on 
     Wall Street. It is now very important to revive the economy 
     that the government assist Main Street, which includes 
     community banks, if we are to have job creation. Jobs are 
     created by small business that bank at community banks.

  And the writer goes on:

       As a community banker in Oregon, I urge you to retain the 
     $30 billion small business lending fund. . . . Community 
     banks are well-positioned to leverage the SBLF and have 
     established relationships with small businesses in their 
     communities to get credit flowing quickly. Leveraging the $30 
     billion funds with community banks would potentially support 
     many times that amount in loan volume to small businesses--as 
     much as $300 billion in additional lending.

  The writer concludes:

       Banks that increase their small business lending by certain 
     threshold percentages will pay reduced dividend costs, 
     ensuring that their incentive to lend matches their great 
     capacity to do so.
       Thank you very much, Sincerely Tom.

  That was a letter from Tom of M Street Bank.
  I thank the many colleagues who have put themselves behind this idea 
and supported it. An earlier rendition of this idea was called 
``Banking on our Communities'' and had support from Senators Carper, 
Hagan, Kerry, Levin, Pryor, Stabenow, and Mark Udall, and I wanted to 
mention that they have been sponsors of that legislation.
  I urge my colleagues to stand for small businesses, stand to provide 
a solution to the problem of liquidity and access to loans that is 
plaguing our small businesses, stand to help not just your community 
banks but your community businesses and your families who will benefit 
from the jobs that it will create.
  I thank my colleague for her passionate and effective leadership on 
this particular issue and for her leadership on our Small Business 
Committee.
  The PRESIDING OFFICER. The Senator from Louisiana.
  Ms. LANDRIEU. Mr. President, I thank my colleague, and let me add a 
few words to that wonderful explanation. Again, what we are on the 
floor talking about here--the jobs 3 bill, the small business bill--is 
a lending program for small business. This is not a bank bailout. It is 
not a big bank bailout. It is not a medium-sized bank bailout, It is 
not a small-sized bank bailout. It is not for banks. It is for small 
businesses.
  We are using healthy banks, not troubled banks, as a conduit to reach 
small businesses so they do not have to rely on high rates through a 
credit card company that is impersonal and not interested in their 
business but just the bottom line. They do not have the home equity 
that they used to have, as you know, either in Delaware or Louisiana or 
Oregon or Texas.
  I think in America we want to encourage healthy relationships between 
our small businesses and our local banks. Only small healthy banks can 
participate in this voluntary program on behalf of small businesses in 
their communities. Ninety percent of community banks are less than $1 
billion, and you can only participate in the Small Business Lending 
Program if you are below $10 billion. So none of the big banks can even 
qualify for this.
  As the Senator from Oregon said, there is not going to be an end to 
this recession any time soon if we don't, in this Chamber, figure out a 
way to get low-cost capital into the hands of small business. We don't 
have many choices. We could issue some more credit cards to them and 
let them pay 15, 16, 17, 24 percent. We can ask them to go back and get 
equity out of their homes, which has all but dried up, and not through 
any fault of their own, or we could give direct lending through the 
Small Business Administration.
  Some people have trouble with the Federal Government acting as a 
direct lender, and I can understand that. It is not what we do. We are 
not a bank. But there are banks out there--there are 8,000 community 
banks--many of which are healthy, and with a little bit more capital 
and a partnership with the Federal Government, they could turn around 
and lend money to businesses that desperately need it.
  Mr. President, I ask unanimous consent to have printed in the Record 
a list of small business organizations I received from the Small 
business Access to Credit Coalition.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Ms. LANDRIEU. Mr. President, I am going to read a few of these 
organizations into the Record at this time. This is a very market-
based, private-sector approach to solving this problem, and that is why 
the American Apparel & Footwear Association, the American Hotel & 
Lodging Association, the American International Automobile Dealers 
Association, the Associated Builders & Contractors, Heating, 
Airconditioning & Refrigeration Distributers International, and we said 
the Independent Community Banks of America, but how about the 
Independent Electrical Contractors, the International Council of 
Shopping Centers, the Main Street Alliance, the National Association of 
Women Business Owners--Los Angeles, and I could go on and on and on.
  There are hundreds of organizations that support this $300 billion 
Small Business Lending Fund. Again, it leverages up to $300 billion of 
potential loans to small businesses right here in America to create the 
jobs we need to move us out and past this recession to higher ground 
and happier times. We can't wait to get there, but we are not going to 
get there by peddling in place. We have to move forward.
  This is a bold proposal, but it is very much based on common sense. 
It is easy to understand, with clear parameters for understanding it. 
It is using the great asset of community banks to

[[Page S5988]]

get low-cost capital into the hands of small businesses--shoe stores, 
retailers, cleaners, grocery stores--that can then start the hiring of 
one or two or three extra people. All of that is going to add up to 
more consumer demand. As people have paychecks, they can go spend them, 
increasing demand.
  This is economics 101. It is very simple. It is bold, it is simple, 
and I believe it will work. It is voluntary. It is for healthy banks 
only--for community banks only. It has nothing to do with Wall Street, 
hedge funds or bailouts. It has everything to do with job creation on 
Main Street in America, and more than 100 small business organizations 
are supporting this initiative.
  I thank the Members of the Senate, both Democrats and Republicans, 
who have been very supportive. We are grateful for the wonderful 
testimony and endorsements we have received from these very powerful 
organizations and we look forward, after we have the vote on 
unemployment sometime tomorrow, to getting back to the business of 
ending this recession. We have all had about as much of it as we can 
take.
  We want to move to stronger times, to happier times. We are only 
going to do that by giving small business substantial and targeted tax 
cuts and a lending program that they can work for them and the 
businesses they want to serve and service every day on Main Streets 
throughout America.

                               Exhibit 1

               Small Business Access to Credit Coalition

                          (February 17, 2010)

       Dear Senator: Access to credit is a critical issue facing 
     small businesses today. The undersigned organizations, 
     representing millions of small business owners in every 
     industry sector, were very disappointed to learn that only 
     one provision related to expanding small business access to 
     credit was included in the draft legislation offered by 
     Senators Baucus and Grassley, the ``Hiring Incentives to 
     Restore Employment Act.'' Furthermore, none of the provisions 
     aimed at improving the Small Business Administration (SBA) 
     lending programs are currently being considered in Majority 
     Leader Reid's latest proposal. We are concerned that if the 
     Senate fails to listen to the needs of small businesses and 
     address the credit crisis, a tremendous opportunity to help 
     create new, sustainable jobs in 2010 and beyond will be lost.
       We urge your support for appropriations to extend the SBA 
     loan provisions of the American Recovery and Reinvestment Act 
     (ARRA) through the end of December 2010. The depletion of 
     funds last fall is proof that the SBA programs were, and 
     continue to be, critically important for our nation's 
     creditworthy entrepreneurs. An additional $354 million in 
     appropriations is needed to fund the extension of the higher 
     guaranty percentages and waiver of borrower fees for the 
     balance of the fiscal year.
       Additionally, we urge your support for an increase in the 
     maximum loan size and the maximum guaranteed portion of SBA 
     loans. Senators Landrieu and Snowe have introduced 
     legislation that would increase the maximum size of SBA 7(a) 
     and 504 loans from $2 million to $5 million. This legislation 
     would also provide a commensurate increase in the statutory 
     maximum guaranteed portion of SBA 7(a) loans. Moreover, the 
     CBO has determined that their legislation, S. 2869, will have 
     no impact on spending or revenue. These levels are 
     recommended by the Administration, have bi-partisan support 
     and we urge your support as well.
       By including these provisions in upcoming legislation aimed 
     at spurring new job creation, there is the potential to 
     leverage an additional $16 billion in SBA lending in 2010. 
     According to Federal Highway Administration data, federal 
     spending on highway programs can generate about 34,100 jobs 
     for every $1 billion spent. Small businesses can generate the 
     same rate of job creation, except that small businesses have 
     the ability to create new, sustainable jobs in every local 
     community. Therefore, by acting on these recommendations, the 
     Senate will help increase small business lending that will 
     result in over 545,000 sustainable new jobs in the next year.
       We urge you to act quickly so that we can continue to 
     realize the SBA lending momentum we saw in 2009. Small 
     businesses cannot be the engine of our economy if they 
     continue to face unrelentingly tight credit markets. The 
     Senate must include these important provisions in the job 
     creation bills currently pending in order to restart the flow 
     of credit to America's small businesses or else these 
     entrepreneurs will be left to sit on the sidelines.
           Respectfully,
         American Apparel & Footwear Association; American Bankers 
           Association; American Foundry Society--California 
           Chapter; American Hotel & Lodging Association; American 
           International Automobile Dealers 
     Association; Associated Builders & Contractors; California 
     Association for Micro Enterprise Opportunity; California 
     Association of Competitive Telecommunications Companies; 
     California Cast Metals Association; California Chapter of 
     the American Fence Contractors Association; California 
     Employers Association; California Fence Contractors 
     Association; California Hispanic Chamber of Commerce; 
     California Metals Coalition; California Public Arts 
     Association, Inc.; Council of Smaller Enterprises (Ohio); 
     Engineering Contractors Association; Entrepreneurs 
     Organization Los Angeles; Fashion Accessories Shippers 
     Association; Flasher/Barricade Association; Golden Gate 
     Restaurant Association; Greater Providence (RI) Chamber of 
     Commerce; Heating, Air Conditioning & Refrigeration 
     Distributors International; Independent Community Bankers 
     of America; Independent Electrical Contractors; 
     Independent Waste Oil Collectors and Transporters; 
     International Council of Shopping Centers; International 
     Franchise Association; Main Street Alliance; Marin 
     Builders' Association; Marine Retailers Association of 
     America; Monterey County Business Council; Napa Chamber of 
     Commerce; National Association for the Self-Employed; 
     National Association of Development Companies; National 
     Association of Government Guaranteed Lenders; National 
     Association of Manufacturers; National Association of 
     Women Business Owners--Inland Empire; National Association 
     of Women Business Owners--Los Angeles; National Automobile 
     Dealers Association; National Cooperative Business 
     Association; National Council of Chain Restaurants; 
     National Council of Textile Organizations; National 
     Federation of Filipino American Associations; National Gay 
     & Lesbian Chamber of Commerce; National Marine 
     Manufacturers Association; National Ready Mixed Concrete 
     Association; National Restaurant Association; National 
     Small Business Association; North American Die Casting 
     Association--California Chapter; North Carolina Bankers 
     Association; Northern Rhode Island Chamber of Commerce; 
     NPES--The Association for Suppliers of Printing, 
     Publishing and Converting Technologies Oakland 
     Metropolitan Chamber of Commerce; Oregon Small Business 
     for Responsible Leadership; Peninsula Builders Exchange of 
     California; Plumbing-Heating-Cooling Contractors of 
     California; Recreation Vehicle Industry Association; 
     Recreational Vehicle Dealers Association; Rhode Island 
     Small Business Summit Committee; Sacramento Asian Chamber 
     of Commerce; San Francisco Builders Exchange; San 
     Francisco Chamber of Commerce; San Francisco Small 
     Business Advocates; San Francisco Small Business Network; 
     Small Business Association of Michigan (SBAM); Small 
     Business Association of New England (SBANE); Small 
     Business California; Small Business Majority; Small 
     Manufacturers Association of California; South Carolina 
     Small Business Chamber; Spa and Pool Industry Education 
     Council of California; SPI: The Plastics Industry Trade 
     Association; The Financial Services Roundtable; The 
     Hosiery Association; Travel Goods Association; Tree Care 
     Industry Association; Urban Solutions--San Francisco; U.S. 
     Chamber of Commerce; U.S. Hispanic Chamber of Commerce.

  Mr. MERKLEY. Mr. President, I again thank my colleague for her 
leadership. We together as a Senate need to stand with our small 
businesses so we can revive our communities, restore our economy and 
create jobs for our families. I thank the Senator again for the 
terrific job she is doing.

                          ____________________