[Congressional Record (Bound Edition), Volume 147 (2001), Part 16]
[Senate]
[Pages 22823-22828]
[From the U.S. Government Publishing Office, www.gpo.gov]



          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. DOMENICI (for himself, Mr. Bond, and Mr. Frist):
  S. 1717. A bill to provide for a payroll tax holiday; to the 
Committee on Finance.
  Mr. DOMENICI. Mr. President, I send to the desk to be appropriately 
referred a bill that is cosponsored by Senator Bond and Senator Frist. 
This is going to be called the payroll tax holiday bill.
  Mr. President, we have been talking a lot about a war, and we are 
beginning to read stories about the great valor and the fantastic 
American military machine, of which the American people ought to be 
very proud. Clearly, we have, in months and years past, supplied a very 
large amount of the American tax dollars to provide for adequate 
defense. This war we have waged for a few weeks against hatred and 
terrorism--while that war changed us forever, it also showed the world 
what a tremendous military force America is and what a great idea we 
have with democracy and capitalism matched up, with growth and 
prosperity--what a tremendous idea it is.
  The idea and ideal was received on the streets of cities in 
Afghanistan with cheering for the few Americans who were part of it. 
This morning, we hear a communique from one of our military talking 
about how they are being received.
  At the same time that we are paying for this and asking for our 
wonderful volunteer men and women of the military, there is another 
war, and it is a tough one. It has to do with an economy that for 11 
years was at the very peak of performance--almost without comparability 
in any period of economics that we note here in America. Now that 
economy, as one might have predicted, is going into one of the normal 
and natural downturns--except each one of these recessions are 
different. The qualities are different. What happened to get us there 
is different. There are also a lot of similarities. If we don't engage 
in the war that is also on our plate, called recession, in as unified a 
manner as we attacked the war on terrorism, with a proposal to help the 
economy, thus help our people--that is, Democrat and Republican--and 
gather together and say we each, Democrat, Republican, and the White 
House, have a plan--a lot of Senators have plans. We only had one vote, 
and it is pretty obvious that the Democrat plan can't muster the 60 
votes that is going to be required to get a tax package through the 
Senate.
  We all know the vote. The distinguished Senator from Montana, the 
chairman of the Finance Committee, has done a yeoman's job in trying to 
put together a partisan package. I have been there when you had to do 
that, and then I have had to defend it and try to get it through, with 
the entire party on the other side being opposed. I have listened and 
watched and seen this distinguished Senator do his very best. If the 
Republican plan--which may be the President's plan--is called up, I 
regret to say that I think it is going to get the same kind of 
treatment from the other side of the aisle. I can't say why each side 
has decided that they have a better plan, but that is what has 
happened. Let's hope that it is nothing more than that and that both 
sides still wish to get something done, to get an economic stimulus 
package; that is, a package that will cause America's economy to grow, 
jump-start, give it a little boost.
  I am not going to talk about the things that have already been done, 
other than to say that once the recession started--that is a long time 
ago; for those who think this just came upon us, if you trace the 
economy--and I am sure the occupant of the chair, who, for many years 
of his life, day by day, had to rely upon his ability to analyze the 
economy and/or that of those who worked for him, and decisions had to 
be made on the best assumptions you could put together. But it is clear 
if you look at what happened, this recession started downward about 16 
months ago, before the swearing in of the new President. It started 
down and it has been coming down a little bit at a time for all these 
months.
  During that period, the Federal Reserve Board has, for the 12th time, 
I believe, reduced interest rates. I know if my friend from New Jersey 
were standing here and we were discussing this issue, we would both be 
saying that is a very good thing, reducing the interest rates. No 
question, America relies upon capital for growth, for investment, for 
everything we put people to work with; you have to have money to buy a 
house, to buy a car.
  Incidentally, if anybody wants to know how important interest rates 
are, look at the anomaly in America today. One of the biggest anomalies 
is that we are selling more cars than ever. So we are breaking the bank 
on selling cars in America in the middle of a recession. Well, I guess 
one could say the people finally woke up and wanted new cars, but I 
don't think so. I think they have wanted them all along. But guess 
what. The automobile companies decided it was better to sell cars and 
finance at zero interest rate and keep people working than it was to go 
ahead and cut back on production, charge interest rates so the finance 
companies would be turning a profit, but their factories would be 
laying off people. What an experiment because their people kept working 
and producing automobiles, and the rate of finance is zero. They must 
have analyzed what that does or does not do for their economic picture. 
But in the end, cars are selling because the cost of buying them is 
cheap.
  Now, the economy is still not recovering properly, although somehow--
at least this Senator believes that while I understood what was 
happening and clearly was out front saying we were moving toward a 
recession probably 12 months before we started saying it here, I 
believe there is a real chance if we do something right quick that this 
economy will start back up.
  There are some good signs out there, but there are some not so good 
signs that could indicate it is going to be a long recession. But I am 
putting before the Senate today a proposal. There are many Senators I 
have talked to about it. I won't mention their names. But a few of them 
I thank profusely because they have publicly commented to papers such 
as the Wall Street Journal, and others; some Democrat Senators who have 
analyzed it with me have said it is a very good approach.
  The reason that it is not moving with large numbers of Senators at 
this point is because everybody has some entanglements--and I use that 
word not pejorative--in terms of putting the packages together where 
they have committed here and there and, of course, they can't just jump 
off those ships, they have to let normal events occur.
  But this morning, Senator Bond, Senator Frist, and I put this before 
the Senate and the American people because we truly believe it is 
something that ought to be looked at. We are not here saying it is 
absolutely a cinch that it will work. But we are saying--three of us--
with gaining strength today--the Wall Street Journal quotes Dr. Lindsey 
from the White House. His analysis would indicate that this is a good 
economic stimulus package. Let me suggest that it is quick, doesn't 
have any administrative costs associated with it. It helps city, 
county, States, and private sector, and, indeed, every working man and 
woman in America who pays payroll tax for Social Security.
  The 6.2 percent that comes out of their paycheck will stay in their 
paycheck for whatever month we choose.

[[Page 22824]]

The legislation is drawn for the month of December, for one month. 
Likewise, the employer does not remit to the Federal Government; they 
keep the money.
  In one month, if the month of December is chosen, I say to my friend 
from the beautiful State of Montana, $38 billion will go into the 
American economy via the wage earners and businesses, large and small, 
in one month. They will have that money close to the Christmas season 
one way or the other.
  If we do January, everybody will know it is there. If we do December, 
it will be in their paychecks. The reason I keep using one or the other 
month is because we have not moved with dispatch as everybody had 
hoped. As a consequence, I do not know if we can get it done in time 
for Christmas relief.
  It is a very simple bill. It is quick. The economic activities of it 
are immediate. It eliminates 12.4 percent payroll tax from the OASDI 
for the month of December; $38 million in immediate relief to be spent 
for whatever the recipient wants to do with it.
  Self-employed workers will see their taxes reduced by 12.4 percent in 
that month. It will be split evenly between the employer and employee 
at 6.2 percent on each side. Then, obviously, there is language putting 
the Social Security fund back in its original posture by transferring 
from the general fund. That accounts for the removal and use in the 
economy and the replenishment that one would expect. It is very simple.
  The three of us do this not as a total stimulus package, but for the 
tax portion that has been discussed by each side as being important.
  By a strange coincidence, the two provisions that were in the 
Republican package, the rebate and the 2 percent, the 2-percent 
marginal rate change, turned out to be $38 billion. This package is $38 
billion. It is just a coincidence, but if we are looking for a 
substitute, we could substitute that money.
  Whatever the Senate wants to do about workers compensation, hospital 
and health protection--those are not part of the stimulus package in 
any event. They are part of us wanting to be helpful because people are 
hurting. Those can be worked out. Whether we fight over those or not, 
clearly, eventually, they will be worked out in both bodies.
  There are a lot of economists who have been analyzing this. We do not 
have a lot of them here today to talk about, but there are a lot. 
Perhaps when we return, I will print in the Record an article entitled 
``A Stimulus Package May Not Work'' by Joanne Morrison. It cites three 
or four economists who analyze where we are.
  I say to my colleagues, there are two arguments against what we are 
doing. One, it is taking too long, and, two, it will take too long 
after we pass it. It may be a long-term event rather than a short-term 
stimulus. Second, without any question, there is serious doubt as to 
whether the other packages are very stimulative. In both instances, 
that is corrected here.
  Is it fair? It seems pretty fair. I am not saying we can solve each 
and every problem, but it is pretty fair. I have sent the tax bill to 
the desk.
  I thank my two cosponsors and the Senator from Montana for letting me 
present my thoughts on this. There are a lot of people beginning to ask 
about it and starting to support it. We will put the names of those 
institutions that support this in the Record as soon as we can. The 
Governors are coming on board. We have asked no one. They are reading 
about it now, and we probably will ask a number of other groups in the 
country to give us their views.
  I thank the Senate for giving me time. It is nice that debate can 
occur, but we are not there yet. Maybe a new idea can find its place 
here. I hope it is new enough to receive the consideration it deserves.
  Mr. President, we must move forward. Right now, we have a Republican 
stimulus bill that passed the House. We have the President's plan and 
the Senate Republicans' plan. We have the Senate Democrats' plan.
  But we don't yet have a stimulus plan that will pass the Senate and 
be signed by the President.
  I believe this bill can be the key to bringing both sides together 
quickly once we return from the upcoming Thanksgiving week recess.
  Let me be clear. I support the President. I think this administration 
is right on track when it comes to an economic stimulus package. 
However, any existing plan has to be modified to garner enough Senate 
support to pass.
  We can't wait till later to get this job done. The administration and 
Congress have promised to enact a stimulus package. The American people 
expect a stimulus package. The markets expect a stimulus package. It 
would be a huge mistake to wait.
  The retail sales reported yesterday showed sales up 7.1 percent in 
October. However, this was almost all due to aggressive and 
unsustainable incentives in the auto sector. In effect, these 
incentives are shifting auto sales that would have been made next year 
into this year. The economy is going to be in trouble once these 
incentives stop.
  In order to break the impasse and move the process forward, let me 
describe the bill we have introduced today.
  We propose a one-month payroll tax holiday, which would replace the 
current proposals for a supplemental rebate and the speed-up of the 
marginal rate reductions.
  I'll tell you why.
  IRS Commissioner Rossotti has raised administrative issues related to 
the supplemental rebates. Because of where we are in the calendar, such 
rebates would have to be folded into the taxpayers' 2001 tax returns 
and refunds next spring.
  A payroll tax holiday will be more effective at increasing spending 
than the rebate checks sent out earlier this year or a new round of 
rebate checks. It will put the tax cut in paychecks automatically, 
without the need for special mailings.
  Psychologically, workers are used to adjusting their spending habits 
based on the size of their paychecks. At present, workers spend about 
95 cents for every dollar of after-tax earnings. Increasing their 
after-tax earnings will therefore lead to more spending--if they 
perceive the tax cut to be part of their regular earnings.
  That's why separate rebate checks don't work as well. When a worker 
gets a separate rebate check they are more likely to treat it as a 
special windfall gain and save the money or pay down debt. According to 
the University of Michigan, as of October, in the midst of a recession, 
only 30 percent of people receiving rebate checks were saying they 
would spend the money.
  The speed-up of the marginal rate reductions up has been criticized 
as a permanent change in tax law that benefits upper income folks most.
  The bottom line: A payroll tax holiday is truly a stimulative, 
temporary tax cut that is very likely to be spent.
  All wage earners earning below $80,400, even those that don't earn 
enough to pay income taxes, would benefit.
  Both the employee and employer share (6.2 percent each) of the social 
security (OASDI) payroll tax would be suspended. Self-employed social 
security payroll taxes would also be suspended. The Social Security 
trust fund would be made whole via a transfer from the general fund.
  Employees would have more take home pay and employers would have 
increased cash flow.
  A school teacher making $40,000 would see an increase in their take-
home pay of $207 in December. A self-employed contractor earning 
$40,000 per year (who pays both the employer and employee share of 12.4 
percent) would see an increase in pay of $413.
  It is most desirable to make the one-month period December 1, 2001 
through December 31, 2001. A payroll tax holiday in December would be 
perfectly timed for the holiday shopping season. The whole tax cut 
would go out in only one month. We wouldn't have to wait for a new 
round of rebate checks to go out--a process that could take months and 
interfere with the speed of tax refunds.
  In addition, in 2001 the payroll tax is applied to income up to 
$80,400. By December, approximately 6 percent of wage earners have 
already reached the

[[Page 22825]]

limit and would not receive the benefit of the payroll tax holiday.
  The cost of a December holiday is about $38 billion in fiscal 2002. 
If the holiday were in January, the cost would by about $43 billion, 
because all wage earners would receive the benefit.
  Mr. President, we are at an impasse here in the Senate. Let's all 
admit that neither the Democratic plan nor the President's plan has the 
requisite 60 votes to pass this Chamber.
  I believe this proposal could provide us with the key component to 
reaching a bipartisan way to enact a stimulus bill quickly.
  Mr. BOND. Mr. President, Senator Domenici has a proposal he has 
crafted to provide immediate economic stimulus and assistance to low- 
and middle-income workers who have been suffering, as we all have, from 
the economic downturn.
  I have signed on with him in support of his measure because his idea, 
which is a payroll tax holiday for December, would be the easiest, 
simplest, fairest, and most effective way to get a stimulus of between 
$38 and $41 billion directly into the pockets of middle and lower 
income workers in the United States.
  This is not a tax cut for the rich because anybody who is making over 
$80,000 a year has already finished making their Social Security or 
payroll tax, FICA tax, contributions. This would provide, if we can put 
this in the stimulus package and pass it quickly this month, that you 
would not send in your FICA tax withholdings or contributions for 
December. It is simple. Nothing goes in the mail. You don't have to 
worry about mail deliveries or all the problems we have had. Obviously, 
most people know we haven't had mail for almost a month in Congress. 
There are other places where security precautions have delayed the 
mail.
  You don't have to go through a complicated system of developing 
regulations and rules or even cutting checks for a rebate. When the 
President proposed a rebate many weeks ago, there was time to get the 
rebate check prepared and get it out in December so we would have a 
productive, economically thriving holiday season. Unfortunately, 
because of the lateness of the hour, it is likely that a rebate check 
or other assistance that has to be paid out by check from the Federal 
Government will be 6 to 8 weeks away and will not hit in the pockets 
where the working men and women can spend it until sometime in January 
or February.
  This obviously is one part of a stimulus package. I happen to believe 
that in addition to more generous unemployment benefits and providing 
assistance through grants to the States for health care, we also need 
to have assistance for small businesses, many of which have been 
absolutely savaged by the economic downturn as well as the crash at the 
World Trade Center.
  Those parts are important, too. I have some small business provisions 
I hope will be included in the stimulus package.
  The great thing about the Domenici proposal for the FICA December tax 
holiday, not paying the Social Security withholding amounts in 
December, is that it can happen immediately. It will put the money in 
the pockets of those who can best spend it. It helps the single mom who 
is just struggling to get by. It helps the individual worker who makes 
about $40,000. They would have $210 more in their pockets. For a self-
employed person who has to pay both the employee and employer side of 
the FICA tax, 12.4 percent, that would be about $420 they would not 
have to send to the Federal Government in December. Of course, there 
would be a transfer from the general revenue to Social Security so we 
would not impact Social Security.
  I urge all my colleagues to pay attention to the thoughtful and 
effective proposal Senator Domenici has outlined for us. This should be 
the centerpiece. Democrats and Republicans can come together behind 
this proposal, move it quickly; let's get moving. We are in an economic 
downturn. It has been going on for 15 months. It got a whole lot worse 
after September 11. This economy needs a boost. Leaving the FICA tax in 
the pockets of the people who are working, the medium- and low-income 
workers, and the people who employ them is the best way to get this 
economy moving again.
                                 ______
                                 
      By Mr. BURNS:
  S. 1718. A bill to amend the Internal Revenue Code of 1986 to extend 
section 29 to other facilities; to the Committee on Finance.
  Mr. BURNS. Mr. President, today I rise to introduce the Clean 
Alternative Fuels Incentives Act of 2001. This bill extends and limits 
the credit of producing fuel from non-conventional sources to 
facilities that produce qualified fuels using technologies that provide 
certain environmental benefits, but only if such facilities produce 
enhanced value synthetic fuels from coal.
  It is important to outline the goals of this legislation at the 
outset. The four primary goals of this bill are all very important to 
the future of this Nation. First, the use of alternative fuels reduces 
our Nation's trade imbalance and reliance on foreign energy sources. 
Second, the cleaner, alternative fuels emit cleaner byproduct into the 
environment. Third, these technologies produce jobs in the United 
States. Fourth, they encourage the development of technologies that 
will be economically viable after the short period during which the 
incentive is provided.
  Starting with the energy crisis in the 1970s, Congress acted on 
numerous occasions to provide tax credits intended to develop 
alternative fuels. Prior sessions of Congress took these steps in 
recognition of the need to encourage the development and use of 
alternative fuels, which they hoped would help lead our Nation towards 
energy independence.
  Today our Nation not only needs to continue its efforts to develop 
alternative fuel resources, but given our constantly growing energy 
needs we must consider the environmental impact that conventional and 
non-conventional fuels have on our environment, particularly in light 
of the Clean Air Act.
  In order to maximize the most efficient use of our Nation's reserves, 
this Congress needs to commit to the development of clean alternative 
fuels. My home State of Montana has vast coal reserves. In fact, many 
times our State has been referred to as the ``Saudi Arabia of coal.'' 
Not only do we have vast reserves, but also with clean coal 
technologies we can use these resources and do little harm to the 
environment.
  Those who say that coal is not one of the answers to energy 
independence because of its environmental impact are dead wrong. Coal-
fired plants generate over 50 percent of our Nation's electricity. 
Interestingly, the Energy Information Administration, EIA, reported 
that Montana's emissions of nitrogen oxide, NOx, sulfur dioxide, SO2, 
and carbon dioxide, CO2, all decreased from 1986-1996 while producing 
the same amount of electricity. This proves to me that our coal 
technologies are improving. Folks, I believe the environmental 
emissions will continue to improve and if you provide incentives to 
help clean alternative fuels reach the marketplace, some day we will 
reach energy independence in this Nation.
  One question that some of you may have is, ``Are these proven 
technologies?'' These are proven technologies, but to make the 
continued development of these technologies a reality, the Congress 
needs to provide meaningful incentives. The bill that I offer today 
accomplishes exactly that, it provides clean alternative sources of 
energy a real opportunity to bring energy independence to this Nation.
  This bill would extend the non-conventional fuels credit for 
facilities that produce synthetic fuel from coal using a technology 
that results in: (1) Measurable reductions of certain emissions when 
producing the fuel or when the fuel is burned as a fuel, not including 
any reductions caused by dilution and (2) measurable increases in the 
value of coal, not including any increases caused by additives. These 
two factors will lead to accomplishment of the four goals I stated 
previously. First, the use of alternative fuels reduces our Nation's 
trade imbalance and reliance on foreign energy sources. Second, the

[[Page 22826]]

technologies provide cleaner emissions into the environment. Third, 
these technologies produce jobs in the United States. Fourth, they 
encourage the development of technologies that will be economically 
viable after the short period during which the incentive is provided.
  I hope that Members of this body will support this important piece of 
legislation, which helps our Nation at a time of dire need.
                                 ______
                                 
      By Mr. BAUCUS (for himself, Mr. Hatch, Mr. Grassley, Mr. Miller, 
        and Mr. Bennett):
  S. 1722. A bill to amend the Internal Revenue Code of 1986 to 
simplify the application of the excise tax imposed on bows and arrows; 
to the Committee on Finance.
  Mr. BAUCUS. Mr. President, along with my colleagues, Senators Hatch, 
Miller, and Grassley, I am pleased to introduce the Arrow Excise Tax 
Simplification Act of 2001. This bill will protect funding for the 
Wildlife Restoration Program, the Pittman-Robertson fund, by 
simplifying administration and compliance with the excise tax and 
closing an unintended loophole that allows arrows assembled outside the 
United States to avoid the excise tax imposed on domestic 
manufacturers.
  The creation of the Wildlife Restoration Program is one of the great 
success stories of cooperation among America's sportsmen and women, 
State fish and wildlife agencies, and the sporting goods industry. 
Working together with Congress, Americans who enjoy the outdoors 
volunteered to pay an excise tax on sporting arms and ammunition to be 
used for hunter education programs, wildlife restoration, and habitat 
conservation.
  Originally the archery industry did not participate in this program. 
However, the growth of bow hunting in the '60s and '70s led the archery 
industry to decide they would support the excise tax that funds State 
game agencies. As a result, the tax was extended to archery equipment 
in 1975. The tax on archery equipment was meant to parallel the tax 
that hunters were paying on firearms and ammunition. The archery 
industry and bow hunters are pleased to contribute to the success of 
the Wildlife Restoration Program.
  Because current law taxes components and not arrows, foreign 
manufacturers are selling arrows in the United States without paying 
the excise tax that is imposed on arrows made in the United States. Not 
only are these untaxed imports unfair to American workers, they 
threaten the integrity of the Wildlife Restoration Fund.
  This issue is important to companies in Montana. Mike Ellig, a 
manufacturer of archery products in Bozeman, MT, pays this tax. He 
supports the tax, but asks that it be fair. Mike's company, Montana 
Black Gold, and the archery industry want to support the Wildlife 
Restoration Program. But the way the tax works today, American 
manufacturers are at a competitive disadvantage.
  This legislation will close the loophole that allows imported arrows 
to avoid the excise tax paid by domestic manufacturers. While keeping 
the current 12.4 percent tax on arrow components, the proposal will 
impose a tax of 12 percent on the first sale of an arrow assembled from 
untaxed components. U.S. manufacturers and foreign manufacturers will 
be treated equally.
  Since this loophole was inadvertently created in 1997, archery 
imports, mostly finished arrows, increased from $113,000 in 1997 to 
$2,600,000 in 2001 to date. If Congress does not act quickly to close 
this loophole, domestic manufacturers will be forced to relocate 
outside of the United States. They simply cannot afford to lose market 
share for a fifth year to competitors who do not pay the same tax they 
pay. If a few more move overseas, the rest will follow. The result will 
be a catastrophic loss of revenue for the Federal Wildlife Restoration 
Fund.
  Current law also taxes non-hunters, contrary to congressional intent. 
To relieve non-hunters from the requirement to pay for wildlife 
management, the legislation would eliminate the current-law tax on bows 
with draw weights of less than 30 pounds. Those bows are not suitable 
or, in many States, legal for hunting. To preserve the revenue for the 
Wildlife Restoration Fund, the bill would retain the current tax on 
bows that are suitable for hunting.
  The proposal would also clarify that broadheads are an accessory 
taxed at 11 percent rather than as an arrow component taxed at 12.4 
percent. This will correct the ambiguity in the 1997 act that led to 
the misclassification of broadheads.
  In summary, the Arrow Excise Tax Simplification Act of 2001 would 
accomplish worthy objectives. It would close the loophole that allows 
foreign imported arrows to escape the tax and remove the tax on youth 
and recreational archery equipment that were never meant to be taxed. 
We will accomplish these goals while protecting the Wildlife 
Restoration Program by ensuring that there is no significant diminution 
of revenues collected by the archery excise tax. The Joint Committee on 
Taxation estimates the proposal will decrease revenues by $5 million 
over ten years resulting in small changes in outlays from the Federal 
Aid in Wildlife Fund. Failure to close the import loophole will 
eviscerate the archery tax base resulting in devastating losses to the 
fund.
                                 ______
                                 
      By Mr. LEAHY (for himself and Mr. Grassley):
  S. 1723. A bill to amend the Fair Credit Reporting Act with respect 
to the statute of limitations on actions; to the Committee on Banking, 
Housing, and Urban Affairs.
  Mr. LEAHY. Mr. President, this week the U.S. Supreme Court issued a 
ruling interpreting a provision in the Fair Credit Reporting Act that 
will make it harder for Americans to protect their private financial 
data from identity theft. I rise today with the senior senator from 
Iowa to introduce the ``Protect Victims of Identity Theft Act'' to 
provide consumers in Vermont and across America with the protections 
that they need and deserve. I thank Senator Grassley for his leadership 
and look forward to working with him on this legislation.
  Unfortunately, identity theft victimizes thousands of Americans every 
year. Once a skilled scam artist gets his hands on a consumer's Social 
Security or bank account number, he can wreak unimaginable havoc on a 
family's finances.
  With society conducting more and more of its business electronically, 
the incidence of identity theft in America is on the rise. As of June 
of this year, the Federal Trade Commission reported that its identity 
theft hotline was answering over 1,800 calls per week, up from the 445 
calls per week the hotline received in November 1999. These calls are 
mostly from people who have been hurt by identity theft, but thousands 
of others come from consumers worried about becoming an identity 
thief's next victim.
  When Congress passed the Fair Credit Reporting Act, FCRA, more than 
thirty years ago, it gave consumers important tools to ensure the 
accuracy and privacy of their credit information. The FCRA imposed 
affirmative obligations on the consumer reporting agencies that 
maintain these reports in order to protect consumers' private 
information from unauthorized disclosures. The FCRA says that consumer 
reporting agencies must maintain ``reasonable procedures'' to avoid 
improper use of a consumer's private information.
  These safeguards are essential to protect each American's 
confidential financial information. The FCRA demands that consumer 
reporting agencies require that prospective users of credit information 
identify themselves, certify the purposes for which they are seeking 
the information, and verify that they will not use the information for 
any other purpose, to name just a few examples. Consumer reporting 
agencies that fail to live up to these obligations or that are careless 
with consumers' private information can be held liable to consumers 
harmed by their security lapses.
  Current law provides consumers 2 years from the ``date on which the 
liability arises'' to bring suit against a

[[Page 22827]]

non-compliant consumer reporting agency. This week, the United States 
Supreme Court concluded that the term ``the date on which liability 
arises,'' means the day that a consumer reporting agency fails to 
comply with FCRA's requirements. TRW Inc. v. Andrews, 2001 WL 1401902 
(Nov. 13, 2001). As a result, the statute of limitations clock starts 
ticking whether or not a consumer is aware that information about his 
finances has been illegally handled or disclosed. That means that the 
2-year limitations period can expire before a consumer ever even 
suspects that her credit information has fallen into the wrong hands.
  The 750,000 Americans who annually have their identity stolen and 
their credit put at risk deserve better. It is unfair for the law to 
only protect consumers if they discover the identity theft within 2 
years of the crime, even if the consumer had no reason to know about 
it. That stands the normal rule of discovery for fraud on its head.
  Our bipartisan legislation would clarify that the statute of 
limitations for identity theft does not start until the consumer 
discovers the problem or should have discovered the problem through the 
exercise of reasonable diligence. The exercise of reasonable diligence 
is the traditional common law duty under fraud discovery rules and does 
not impose any new mandate or requirement on a consumer under the FCRA. 
This change in the law ensures that consumers have a fair opportunity 
to vindicate their rights.
  This bipartisan legislative fix is needed to put a stop to identity 
theft. It will encourage consumer reporting agencies to establish 
proper security measures needed to deny identity thieves access to 
Americans' most personal financial information. It ensures that the 
Fair Credit Reporting Act has real teeth to fulfill its mission of 
protecting the accuracy and privacy of consumer credit information. And 
it will give consumers in Vermont and across America a fair shot at 
vindicating their right to keep private information away from 
unscrupulous con artists.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1723

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Protect Victims of Identity 
     Theft Act of 2001''.

     SEC. 2. AMENDMENT TO THE FAIR CREDIT REPORTING ACT.

       Section 618 of the Fair Credit Reporting Act (15 U.S.C. 
     1681p) is amended to read as follows:

     ``SEC. 618. JURISDICTION OF COURTS; LIMITATIONS OF ACTIONS.

       ``(a) In General.--An action to enforce any liability 
     created under this title may be brought in any appropriate 
     United States district court, without regard to the amount in 
     controversy, or in any other court of competent jurisdiction, 
     not later than 2 years after the date on which the violation 
     is discovered or should have been discovered by the exercise 
     of reasonable diligence.
       ``(b) Willful Misrepresentation.--The limitations period 
     prescribed in subsection (a) shall be tolled during any 
     period during which a defendant has materially and willfully 
     misrepresented any information required under this title to 
     be disclosed to an individual, and the information so 
     misrepresented is material to the establishment of the 
     liability of the defendant to that individual under this 
     title.''.

  Mr. GRASSLEY. Mr. President, I am pleased to join my colleague from 
Vermont in introducing a bill to protect victims of identity theft.
  This legislative remedy is prompted by the sweeping impact of the 
Supreme Court's decision this past week on the rights of more than 
750,000 Americans who annually have their identity stolen and their 
credit put at risk. Under current law, consumers have a two-year 
statute of limitations to sue credit reporting companies that fail to 
protect private financial information from improper disclosures and 
security lapses. The problem with the Supreme Court's decision is that 
a victim of identity theft often has no idea that information about his 
finances has been negligently handled or disclosed by a credit 
reporting company until it's too late to take any legal action. Under 
current law, the two year statute of limitations begins when the 
consumer's credit reporting company fails to comply with the law--not 
when the consumer discovers or should have discovered the problem.
  Our bill, the Protect the Victims of Identity Theft Act of 2001, 
changes that rule. As stated, it simply clarifies that the statute of 
limitations for identity theft does not start until the consumer 
discovers the problem or should have discovered the problem. This 
change in the law ensures that consumers have a fair chance to 
vindicate their rights should credit reporting companies fail to take 
reasonable steps to protect private financial and personal information 
from theft and misuse.
  I urge my Senate colleagues to join us in co-sponsoring this 
legislation to protect the American consumer.
                                 ______
                                 
      By Ms. SNOWE:
  S. 1725. A bill to require the Comptroller General to carry out a 
study to determine the feasibility of undertaking passenger rail 
transportation security programs that are similar to those of foreign 
countries; to the Committee on Commerce, Science, and Transportation.
  Ms. SNOWE. Mr. President, in the last two months we have experienced 
a steep learning curve as a country and as a Congress in our efforts to 
improve homeland security.
  As we saw with the drafting of the airline security bill, the United 
States has not cornered the market on security innovations and 
measures; there is much we can learn from other countries that have 
faced or addressed the same challenges. For this reason, I am 
introducing legislation that would require the General Accounting 
Office to initiate a study examining the security measures that have 
worked for other regions and countries such as the European Union and 
Japan.
  For example, the $15 billion channel tunnel or Chunnel linking 
England to the European continent has been open to train service, for 
passengers and freight, since 1994 without a major security incident. 
In 2000 alone, 2.8 million cars, 7.1 million passengers, and 2.9 
million tons of freight made the 31 mile journey under the English 
Channel safely.
  Security has always been a major concern for the Chunnel and that 
Britain, France, and Eurotunnel, the company operating the tunnel, have 
made security a top priority without degrading passenger service. In 
fact, in addition to its private security staff provided by Eurotunnel, 
the Chunnel is policed by a bi-national force of police, immigration, 
and customs officers with armed patrols in the British and French 
terminals. And both the company and the respective government agencies 
also conduct routine intelligence-led security checks on both passenger 
and freight vehicles.
  So I suspect that our friends in Europe, and in Asia, and other 
regions, may be able to provide valuable insight on how we can improve 
our rail transportation security. It is my intent with this bill to 
direct the General Accounting Office to complete, no later than January 
2002, a study of rail transport security measures in other countries in 
an effort to seek innovative screening procedures and processes and 
other security measures that may be a benefit to the United States. 
Subsequently, an assessment of these measures would be provided to 
Congress.
  In the hours and days after September 11, Americans discovered we are 
not alone in this struggle and I urge my colleagues to support this 
bill that encourages the United States to reach out and learn from 
others.
                                 ______
                                 
      By Ms. SNOWE:
  S. 1728. A bill to provide for greater security at seaports; to the 
Committee on Commerce, Science, and Transportation.
  Ms. SNOWE. Mr. President, I rise today to introduce the Maritime 
Security Advancement Act which is designed to mitigate the threat of 
maritime- and seaport-related terrorism.
  In the aftermath of the despicable terrorist attacks of September 11, 
I believe it is critical that we pass the strongest possible security 
enhancements to our transportation system

[[Page 22828]]

and do so as soon as possible. To this end, we have been working to 
enhance aviation security, and for obvious reasons, this has been one 
of our first and highest priorities in the wake of the recent attacks. 
At the same time, we must also address concerns about highway safety, 
rail safety, pipeline safety, and maritime and seaport security. I 
support efforts to close the security gaps in each and every mode in 
the vast national and international transportation network that is so 
critical to our economy, our freedom, and our way of life.
  We are going to need the resources of the United States coupled with 
the cooperation of our global neighbors in order to wage the war 
against terrorism. For it is a fight we must win, and will win. The 
purpose of the legislation I am introducing today is to employ more 
tools in the fight against terrorism. Specifically, the Maritime 
Security Advancement Act would direct the Secretary of Transportation, 
in awarding loan guarantees, grants, and other forms of financial 
support for research and development under the discretionary authority 
of the U.S. Department of Transportation, to give preference to 
projects with the potential to reduce the threat of maritime- and 
seaport-related terrorism.
  For example, the legislation would promote the development of 
projects designed to increase the feasibility of securing cargo, 
sealing containers, and making cargo containers more tamper resistant; 
improve cargo container content labeling technologies; and provide for 
innovations in the physical handling of cargo in ways that could reduce 
the threat of terrorism aimed at our maritime transportation system.
  The bill would also direct the Secretary to identify the technologies 
with the potential to provide the greatest security with respect to 
handline, labeling, sealing, and transportation of cargo and report to 
Congress on its findings. And the bill authorizes the Secretary to 
issue new rules requiring deployment of such technologies and practices 
in an effort to enhance security and reduce the threat of terrorism.
  We must leave no stone unturned in the effort to preserve the 
security of this nation's transportation infrastructure, so that we 
might both carry on the business of the Nation and ensure our continued 
economic viability, and also ensure that we are in good position of 
strength to be able to wage the kind of war necessary to eradicate 
terrorism. And we cannot remain strong if we cannot remain mobile. 
Accordingly, I urge my colleagues to join me in supporting this 
legislation.

                          ____________________