[Congressional Record Volume 159, Number 113 (Thursday, August 1, 2013)]
[Senate]
[Pages S6150-S6154]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Unaminous Consent Request--S. 101
Mr. VITTER. Mr. President, I stand today to discuss and strongly
support my bill, S. 101, the State and Local Government Bailout
Prevention Act. I urge all of us to unite to pass this bill
[[Page S6151]]
expeditiously. Let me briefly explain what it is about.
I first introduced this bill in early 2011, February 2011, because
two things were happening. First of all, several significant State and
local entities were teetering on the verge of bankruptcy. At the same
time, the Federal Government--things in Washington--was in a horrible
state fiscally, such that we could clearly not afford to take on more
spending, more debt, more responsibility. I wanted to pass legislation
that would make it crystal clear that neither we, the Congress, nor the
Treasury Department, nor the Federal Reserve, nor any other Federal
entity was going to bail out State or local governments that had acted
irresponsibly and tipped into bankruptcy.
Things have not gotten better since then. In fact, in many ways
things have gotten worse, and very recently, just in the last few
weeks, the city of Detroit filed for bankruptcy--the largest municipal
bankruptcy in U.S. history. Other large States and local communities
are teetering on the verge of bankruptcy. Many States are in a horrible
fiscal situation, such as California and Illinois.
Meanwhile, we are not in a fundamentally more sound place here in
Washington at the Federal level. Even if we stick to the Budget Control
Act numbers--and that is very much up in the air, but even if we stick
to those numbers, Congress will spend $967 billion in discretionary
money this year, and that will result in a $810 billion deficit--almost
a $1 trillion deficit this year.
This Nation, total, is almost $17 trillion in debt. The balance sheet
of the Federal Reserve has swollen from $800 billion in August of 2007
to over $3.5 trillion today.
Now more than ever, S. 101, the State and Local Government Bailout
Prevention Act, is appropriate, is needed. That is why I come to the
floor today to urge expeditious passage of S. 101. This bill is very
simple, basic, straightforward, but important. It would simply do four
things: First, it would prohibit the use of Federal funds to bail out
State and local government budgets. Second, it would prevent the
Federal Reserve from providing assistance to or creating a facility to
help, again, State and local governments in a bailout situation. Third,
it would prevent Congress and the Treasury Department from bailing out
State and local governments. Fourth, there is specific language so we
do not create any confusion that this is not intended to stop or deter
or interfere with appropriate assistance in declared disaster areas.
That is the sum and substance of S. 101, the State and Local
Government Bailout Prevention Act. When you look at situations such as
Detroit--the largest ever municipal bankruptcy--and when you look at
our fiscal situation in Washington at the Federal level, this clear bar
of the Fed bailing out State and local governments is very much needed.
I ask unanimous consent that the Committee on Banking, Housing, and
Urban Development be discharged from further consideration of S. 101
and the Senate proceed to its immediate consideration and that the bill
be read a third time and passed and the motion to reconsider be
considered made and laid upon the table.
The ACTING PRESIDENT pro tempore. Is there objection?
Mr. WYDEN. Mr. President, I object.
The ACTING PRESIDENT pro tempore. Objection is heard.
Mr. WYDEN. Mr. President, I will be very clear. First, I say to my
colleague from Louisiana, he and I have worked together often on a
whole host of issues. He is on Environment and Public Works; I chair
Energy. I want him to know I am happy to continue working with him on
this and other issues. The reason I have to object at this time is that
the language as it is written would deal a huge body blow to more than
700 rural and heavily forested counties across the country in more than
40 of our States. It, in effect, could prohibit payments under the
Secure Rural Schools and Community Self-Determination Act.
This legislation, which was a bipartisan bill--Senator Larry Craig
and I authored this legislation--is a lifeline for these hard-hit rural
communities that are walking on a tightrope. They are trying to
balance, for example, how they are going to keep the schools open and
how they are going to have law enforcement in their communities.
Declining revenues from Federal forests spurred the creation of this
program to compensate for the loss of receipts from the Federal
forests. Suffice it to say that without this legislation we could have
school perhaps 3 days a week in a big chunk of rural America. I
mentioned law enforcement. The question of how you maintain 24-hour law
enforcement in a lot of these areas has been drawn into question. I
think that without this assistance we might have some counties facing
bankruptcy.
Given the fact that this language does not clarify the status of the
Secure Rural Schools Program, I have to object. I am going to continue
to object until the legislation does clarify that it will not prohibit
payments under that legislation, which is a lifeline for rural America.
We have had a number of recorded votes on that particular legislation
here in the Senate. It has received overwhelming bipartisan support. It
was authorized on a bipartisan basis.
I am going to yield the floor. I know colleagues want to speak on
this issue. I want it understood how concerned I am about the
legislation in its present form. That is why I have to object at this
time.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Michigan.
Ms. STABENOW. Mr. President, I too join with our colleague from
Oregon in raising great concern about what this proposal would do. This
is a proposal--we have seen, actually, three of them now--that would
cut all Federal funding for any community that has either defaulted or,
more important, is at risk, has problems financially. What does that
mean? It means that any city, any county, any local unit of government
that is struggling with a tight budget could potentially lose all
Federal funding. We are not talking about a bailout here. We are
talking about the same Federal funds that go to every community--no
funding for emergency services such as police departments and fire
departments; no funding for transportation, for roads and bridges;
cutting off funding for special education and for our schools; no
funding for economic development to help these communities that are
challenged because of, possibly, economic circumstances such as a
shifting manufacturing base or other economic issues beyond their
control.
This is extremely broad. According to some legal definitions,
``default'' could mean anything--late payments on any kind of an
obligation. It makes absolutely no sense.
Let me also indicate that one of the real concerning problems here is
that it would exempt emergency spending for a natural disaster. I
appreciate that the Senator from Louisiana would want to do that given
the fact that we had Hurricane Katrina hit in New Orleans and our whole
country came together. People in Detroit raised money to help with
Hurricane Katrina. But I suggest that for the 41 cities and counties
that filed bankruptcy over the last 20 years or the hundreds from
Texas, to Kentucky, to Alabama, and beyond who now have troubled bond
ratings and are considered at risk--this is really a slap in the face
to every city and community across our country.
This is not about stopping a bailout for Detroit. We are working
hard. People are coming together. This is a community that is coming
back thanks to a tremendous amount of grit, hard work, and leadership
from the business community, religious community, community leaders,
and so on. This is about whether we are going to support communities
that need some help.
Think about this: If a city is doing well and has a wealthy tax base
and an upper middle-income community with high-powered lobbyists, then
they should get Federal money--taxpayer money? Children with
disabilities can get special education. We are going to help build
roads and bridges in communities. But if a community is having some
financial difficulty, then, unfortunately, we would say we would not
allow the same ordinary Federal funding every community gets to be
available for that community. That is not the right values for America.
That is why the International City/County Management Association, the
National Association of Counties, the National League of Cities, the
U.S. Conference of Mayors, the Government
[[Page S6152]]
Finance Officers Association strongly oppose this effort.
I have one final statement to make before turning to our
distinguished senior Senator from Michigan.
When we are looking at what is happening right now in Detroit and
around the country, once again we are seeing workers and retirees on
the frontline who have lost their pensions and their wages. In the auto
rescue, we saw Delphi retiree pensions were not protected. Now in the
city of Detroit, police, fire, and city workers are not protected. So
when we talk about the middle class of this country--people working
hard every day--we need to put them first. We need to make sure nobody
loses their pension. We need to make sure we stand as a country with
cities that are in distress and working hard to become vibrant and
strong again.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Michigan.
Mr. LEVIN. Mr. President, I too object to the unanimous consent
request. While the sponsor says it is aimed at bailouts, no one I know
of is seeking a bailout from the communities that would be impacted.
Despite the stated intention, the effect of this bill is to endanger
the financial health of hundreds of cities and counties in every corner
of this country. It would weaken the safety and security of countless
Americans who call those communities home. I don't know of anyone
seeking a bailout. Yet bailout is the word that is used frequently here
by the sponsor of this legislation.
What is the definition? Communities at risk of defaulting. Hundreds
and hundreds of communities are ``at risk of defaulting.'' It is
unclear what that means. But the strains on local governments in the
last few years--particularly following the financial crisis we had--are
real. To say that any community, city, or State, for that matter, that
is at risk of defaulting is to be challenged in terms of getting
regular support from the Federal Government.
This is not limited to loans. This bill affects grants as well as
loans. In the words of the bill, ``grants and aid'' would be prevented.
All sorts of Federal funding, in other words, besides those kind of
actions of the Federal Government involving credit or reliance on
credit of the donor or for repayment.
The Congressional Research Service says this, again, applies not just
to loans but to grants as well. Why in Heaven's name would struggling
communities--whether it is my hometown of Detroit or any other
community in this country--be denied the ability to seek grants is
beyond me. It is not limited to loans but grants as well. This bill
goes way beyond the bailouts that no one is seeking and would have a
severe impact on cities and towns across the country.
Standard & Poor's lists more than 250 securities offered by Louisiana
municipalities that are below investment grade. One State has 250
communities with securities below investment grade, which presumably
means there is a significant credit risk in those communities. Under
this bill, are those communities not eligible to seek regular grants? I
am afraid so, and that is not just me saying that. Again, that is from
the CRS.
Finally, Senator Stabenow has made reference to a letter that we
received from the National League of Cities, National Association of
Counties, the United States Conference of Mayors, and others, opposing
this legislation because it goes way beyond its stated purpose of
preventing bailouts.
Again, my town--and I don't know of any town that has--has not asked
for a bailout. I am proud to have been living in Detroit all of my
life. It doesn't need this kind of legislation poking at it to stop
something from going to Detroit, which it has not applied for.
I know this legislation was introduced before this recent bankruptcy
application on the part of the city of Detroit, but nonetheless to seek
a unanimous consent in this context and in this moment to pass
legislation--apparently without even a hearing--seems to me to be
beyond the pale.
As a lifelong resident of Detroit, I oppose this proposal. I oppose
it because thousands of municipalities that have suffered in the
aftermath of the recent recession would be negatively affected. Our
residents, their residents, our employees, their employees, and
retirees around the country deserve better.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Louisiana.
Mr. VITTER. Mr. President, I appreciate the two Senators from
Michigan being the only ones on the floor right now objecting and
saying this has nothing to do with Detroit, but, of course, it does.
I am very sorry to hear this objection. There is no objection on the
Republican side. Of course there would be an objection if, in fact,
this legislation would bar normal Federal grants and normal Federal
loans unrelated to a bailout of a State or a municipality in bankruptcy
mode, but it doesn't do that.
The legislation is very specific and very targeted. It is about a
bailout of a State or locality in bankruptcy mode, and that is what it
is about. It is not about normal routine Federal funding, and that is
why there is no Republican objection.
One of the distinguished Senators from Michigan makes the point that
Detroit has not formally asked for a bailout. That is true so far. But
when the mayor talked to the Wall Street Journal about this, he ``left
the door open for a Federal bailout after the city's bankruptcy
filing.'' When asked directly whether Detroit would seek a Federal
bailout, Mayor Bing said, ``Not yet.''
Similarly, the Governor of Michigan Rick Snyder didn't support a
bailout but said on CBS's ``Face the Nation:'' ``If the Federal
Government wants to do that, that's their option.'' That is not exactly
not opening the door and considering that opportunity.
Again, I didn't file this bill in the last 2 weeks. I originally
filed this bill in February of 2011. Unfortunately, Detroit isn't the
only municipal or State bankruptcy on the maps. States can't formally
file bankruptcy, but in laymen's terms they can essentially go
bankrupt. Detroit is not the only issue on the map. Many States face a
horrible fiscal situation as well, such as California and Illinois.
There is a real danger of these States and localities seeking a Federal
bailout. This bill is about that. It is not about normal Federal
funding. It is not about the safe and secure rural schools program. It
is not about any of that routine stuff. It is about a bailout of a
State. It is about a bailout of the municipality or other local
jurisdiction. Of course, Detroit, unfortunately, is the most obvious
example after its historic bankruptcy filing very recently.
Again, I am sorry to hear their objection. I am sorry the two
Senators from Michigan are here on the floor about this. I don't think
that is a coincidence because this is a bill about bailouts. I think we
should pass it, and be very crystal clear at the Federal level that we
are not going to take on that bailout role and responsibility.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Michigan.
Mr. LEVIN. On line 7, page 1: ``Notwithstanding any other provision
of law''--and then after talking about Federal funds not being used to
purchase or guarantee obligations, it then says:
no Federal funds may be used . . . or provide direct or
indirect grants-and-aid, to any State government, municipal
government, local government, or county government which, on
or after January 26, 2011, has defaulted on its obligations.
It is very clear. It is line 7, page 1, and lines 1 and 2 on page 2:
``direct or indirect grants-and-aid to'' may not be provided to any
city which has defaulted on its obligations. This is the language of
the bill.
It also says on line 12 of page 2 that the funds of the United States
may not be used ``to assist such government entity.'' ``Assist any such
government entity.''
Hundreds of governments would be covered by this legislation. It is
no coincidence that the Senators from Michigan are here on the floor
because we are the most current victims of this language if it were
ever passed. There are hundreds of others who would be victimized by
this language because of its breadth, and that is what the Senator from
Oregon was very dramatically pointing out.
Mr. President, I ask unanimous consent that the language from the
bill be printed in the Record at this time.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[[Page S6153]]
S. 101
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. PROHIBITION ON THE USE OF FEDERAL FUNDS TO PAY
STATE AND LOCAL OBLIGATIONS.
(a) In General.--Notwithstanding any other provision of
law, no Federal funds may be used to purchase or guarantee
obligations of, issue lines of credit to, or provide direct
or indirect grants-and-aid to, any State government,
municipal government, local government, or county government
which, on or after January 26, 2011, has defaulted on its
obligations, is at risk of defaulting, or is likely to
default, absent such assistance from the United States
Government.
(b) Limit on Use of Borrowed Funds.--The Secretary of the
Treasury shall not, directly or indirectly, use general fund
revenues or funds borrowed pursuant to title 31, United
States Code, to purchase or guarantee any asset or obligation
of any State government, municipal government, local
government, or county government, or otherwise to assist such
government entity, if, on or after January 26, 2011, that
State government, municipal government, or county government
has defaulted on its obligations, is at risk of defaulting,
or is likely to default, absent such assistance from the
United States Government.
(c) Prohibition on Federal Reserve Assistance.--
Notwithstanding any other provision of law, the Board of
Governors of the Federal Reserve System shall not provide or
extend to, or authorize with respect to, any State
government, municipal government, local government, county
government, or other entity that has taxing authority or
bonding authority, any funds, loan guarantees, credits, or
any other financial instrument or other authority, including
the purchasing of the bonds of such State, municipality,
locality, county, or other bonding authority, or to otherwise
assist such government entity under any authority of the
Board of Governors.
(d) Limitation.--Subsections (a) through (c) shall not
apply to Federal assistance provided in response to a natural
disaster.
Mr. LEVIN. I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, I support the nomination of Raymond T.
Chen, to be United States Circuit Judge for the Federal circuit. This
is the 29th judicial confirmation this year. With today's confirmation,
the Senate will have confirmed 200 lower court nominees; we have
defeated two. That's 200 to 2. That is an outstanding record. That's a
success rate of 99 percent.
We have been doing that at a fast pace. During the last Congress, we
confirmed more judges than any Congress since the 103rd Congress, which
was 1993 to 1994.
So far this year, the first of President Obama's second term, we've
already confirmed more judges than were confirmed in the entire first
year of President Bush's second term. At a similar stage in President
Bush's second term, only 10 judicial nominees had been confirmed. We
are now at a 29-to-10 comparison with President Obama clearly ahead of
where President Bush was. And, as I said, we have already confirmed
more nominees this year--29--than we did during the entirety of 2005,
the first year of President Bush's second term, when 21 lower court
judges were confirmed.
With regard to hearings, the record shows that President Obama is
being treated much better than President Bush during his second term.
Last week we held the 11th judicial nominations hearing this year. In
those hearings we we have considered a total of 33 judicial nominees.
Compare this favorable treatment of President Obama during the
beginning of his second term versus the first year of President Bush's
second term. At this stage in President Bush's second term, the
Committee had held not 11 hearings with 33 judicial nominees, but only
3 hearings for 5 nominees, and all of those were hold-overs from the
previous Congress.
In fact, for the entire year of 2005, Senate Democrats only allowed 7
hearings for a grand total of 18 judicial nominees.
It is hard to believe, but no nomination hearings on judicial
nominees were held during April, May, June, or July. Four months with
no judicial nomination hearings. Yet, we recently rushed through
hearings on nominees to the DC Circuit Court of Appeals, plus a number
of District nominations. In fact, in just the last few weeks, we have
held hearings for 14 judicial nominees. That's not very far behind the
entire output of 2005--7 hearings, 18 nominees.
Again, we have already exceeded that number--11 hearings and 33
judicial nominees. The bottom line is that the Senate is processing the
President's nominees exceptionally fairly.
President Obama certainly is being treated more fairly in the first
year of his second term than Senate Democrats treated President Bush in
2005. It is not clear to me how allowing more votes and more hearings
than President Bush got in an entire year amounts to ``unprecedented
delays and obstruction.'' Yet, that is the complaint we hear over and
over from the other side. So I just wanted to set the record straight--
again--before we vote on this nomination.
Raymond T. Chen is nominated to be United States Circuit Judge for
the Federal circuit. He received his B.S. from the University of
California, Los Angeles, in 1990 and his J.D. from New York University
School of Law in 1994. Upon graduation, Mr. Chen worked at Knobbe,
Martens, Olson & Bear in California from 1994 to 1996. As an associate,
he drafted district court briefs and legal memoranda on specific patent
and trademark issues as well as several patent applications spanning
various technologies.
In 1996, Mr. Chen joined the senior technical assistant's office at
the Federal circuit in Washington as one of three technical assistants.
There, he researched and wrote memoranda, commenting on drafts of court
opinions for both legal and technical accuracy as well as
identification of conflicting legal precedent, occasionally writing for
individual judges.
From 1998 to 2008, Mr. Chen served as an associate solicitor in the
Office of the Solicitor at the United States Patent and Trademark
Office. During that time, he was first or second chair on several dozen
Federal Circuit briefs defending the agency's patent and trademark
decisions, and he presented approximately 20 arguments in the Federal
Circuit.
He regularly appeared in district court defending the agency against
lawsuits brought under the Administrative Procedure Act. He was also a
legal advisor on several patent policy and legal issues within the
agency, occasionally prosecuting patent attorneys in administrative
proceedings for violating the agency's code of professional
responsibility.
In 2008, Mr. Chen became the Deputy General Counsel of Intellectual
Property Law and Solicitor. There he supervises other lawyers in the
Solicitor's Office and has presented oral arguments in some of the
seminal patent cases before the Federal circuit.
In addition, Mr. Chen deals with higher-level patent and trademark
policy issues within the agency. He also coordinates the determination
of what positions the United States should take as an amicus in
intellectual property cases before both the Supreme Court and the
Federal circuit.
Lastly, Mr. Chen is responsible for the review and clearance of all
new regulations and amendments to existing regulations for the Office
of the Solicitor.
The ABA Standing Committee on the Federal Judiciary gave him a
unanimous ``well qualified'' rating.
The PRESIDING OFFICER (Ms. Baldwin). All time has expired.
Mr. GRASSLEY. I ask my colleagues to vote for this nomination.
Mr. LEAHY. Madam President, I ask unanimous consent for 30 additional
seconds.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. LEAHY. I believe we should act quickly on a number of judicial
vacancies. Eleven of the twelve circuit and district nominees currently
pending before the Senate were reported by voice vote. All Democrats,
all Republicans on the Judiciary Committee voted together. There is no
reason why we couldn't consider all 12 today, along with Mr. Chen. If
we work together, then we can fulfill the needs of the Federal
judiciary.
Madam President, have the yeas and nays been ordered?
The PRESIDING OFFICER. They have not.
Mr. LEAHY. I request the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
There is a sufficient second.
The question is, Will the Senate advise and consent to the nomination
of
[[Page S6154]]
Raymond T. Chen, of Maryland, to be United States Circuit Judge for the
Federal Circuit?
The clerk will call the roll.
The assistant bill clerk called the roll.
Mr. DURBIN. I announce that the Senator from Louisiana (Ms. Landrieu)
is necessarily absent.
Mr. CORNYN. The following Senators are necessarily absent: the
Senator from Oklahoma (Mr. Inhofe) and the Senator from Arizona (Mr.
McCain).
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 97, nays 0, as follows:
[Rollcall Vote No. 198 Ex.]
YEAS--97
Alexander
Ayotte
Baldwin
Barrasso
Baucus
Begich
Bennet
Blumenthal
Blunt
Boozman
Boxer
Brown
Burr
Cantwell
Cardin
Carper
Casey
Chambliss
Chiesa
Coats
Coburn
Cochran
Collins
Coons
Corker
Cornyn
Crapo
Cruz
Donnelly
Durbin
Enzi
Feinstein
Fischer
Flake
Franken
Gillibrand
Graham
Grassley
Hagan
Harkin
Hatch
Heinrich
Heitkamp
Heller
Hirono
Hoeven
Isakson
Johanns
Johnson (SD)
Johnson (WI)
Kaine
King
Kirk
Klobuchar
Leahy
Lee
Levin
Manchin
Markey
McCaskill
McConnell
Menendez
Merkley
Mikulski
Moran
Murkowski
Murphy
Murray
Nelson
Paul
Portman
Pryor
Reed
Reid
Risch
Roberts
Rockefeller
Rubio
Sanders
Schatz
Schumer
Scott
Sessions
Shaheen
Shelby
Stabenow
Tester
Thune
Toomey
Udall (CO)
Udall (NM)
Vitter
Warner
Warren
Whitehouse
Wicker
Wyden
NOT VOTING--3
Inhofe
Landrieu
McCain
The nomination was confirmed.
The PRESIDING OFFICER. Under the previous order, the motion to
reconsider is considered made and laid upon the table, and the
President will be immediately notified of the Senate's action.
____________________