[Congressional Record (Bound Edition), Volume 147 (2001), Part 3]
[Senate]
[Pages 3631-3650]
[From the U.S. Government Publishing Office, www.gpo.gov]



                BANKRUPTCY REFORM ACT OF 2001--Continued


                     amendment no. 36, as modified

  The PRESIDING OFFICER. The clerk will report the pending amendment of 
the Senator from Minnesota.
  The legislative clerk read as follows:

       Amendment No. 36, as modified, previously proposed by Mr. 
     Wellstone.

  Mr. WELLSTONE. Mr. President, I want to be clear with my colleagues 
and the majority leader that I came to the floor very early on with 
several amendments to move this process forward. Last week, when I 
initially objected to a motion to proceed, the majority leader said we 
would have substantive debate on amendments. This amendment has been 
``hanging out there'' for several days. I have wanted a vote on this 
amendment. I modified this amendment because there was concern on the 
part of one of my colleagues on the other side that there was a 
jurisdictional problem with a committee. I had assumed we would have an 
up-or-down vote on this amendment. My understanding is that it might 
not happen and there might be a second-degree amendment. I don't know 
what that amendment is, but it will probably be an amendment that will 
gut this amendment.
  It makes me start to wonder, even more, about what we have been doing 
out on the floor of the Senate with this bankruptcy bill. My colleague 
called this a reform bill, but I wish to mention a couple of articles 
that have been published recently. I will soon ask to have them printed 
in the Record.
  There was a piece that appeared on Tuesday, March 13, in the Wall 
Street Journal entitled, ``Auto Firms See Profit In Bankruptcy-Reform 
Bill Provision.'' The first paragraph:

       The nation's three major auto makers are always interested 
     in making deals, and they hope to close one in the U.S. 
     Senate this week that is worth millions of dollars to each of 
     them.
       The deal lies in the bankruptcy-reform bill expected to 
     clear the Senate this week. Buried in the bill's 42 pages is 
     a section that changes the way auto loans are treated when an 
     individual declares bankruptcy, making it more likely the car 
     loans will have to be paid back in full--even while other 
     creditors collect only part of what they are owed.

  That might include child support payments as well.
  There also is in here a chart that deals with the soft money, PAC, 
and individual contributions by members of the Coalition for 
Responsible Bankruptcy Laws.
  I actually think the bitter irony is that the debate we have been 
having on

[[Page 3632]]

this bill--for the 2\1/2\ or 3 years I have been working on this--is 
probably, unfortunately, a perfect bridge to the debate we are going to 
have on campaign finance reform.
  Again, I want to be real clear with my colleagues. I don't like to 
come to the floor and do a one-to-one correlation that money has been 
given, so that is why you are voting this way. I don't believe in that 
for several reasons. One, it would be arrogant on my part to believe 
that if somebody has a different point of view, that means, ipso facto, 
they are receiving all this money from, for instance, the financial 
services industry and that is why they are voting the way they are. 
That is not my argument.
  Rather, my argument is institutional, which is more serious. The 
problem with this political process is not that there is 
``corruption,'' as in the wrongdoing of individual officeholders, as in 
one-to-one quid pro quo--here is the money, here is how you should 
vote.
  The problem is institutional, and that is a more serious problem. It 
is the imbalance of power, the imbalance of access, the imbalance of 
influence, not affluence, between the people I have tried to represent 
as a Senator--low- and moderate-income people, people of color, poor 
people, consumers--and the heavy hitters, the investors, the players, 
the lobbying coalition. There has been article after article about the 
full-court press of the financial services industry over this bill.
  The auto firms get a good deal. That is worked into this bill. Buried 
in the bill's 42 pages is a special deal for them.
  By the way, it is not a special deal for you if you are going under 
because of major medical expenses, which is 50 percent of the cases. It 
is not a special deal for you if you have lost your job in the Iron 
Range of Minnesota, 1,400 taconite workers out of work. It is not a 
special deal for you if you have gone through a divorce and there is a 
sudden loss of income. But it is a special deal for these folks. This 
is a piece by Tom Hamburger of the Wall Street Journal.
  There is another piece in the Wall Street Journal by Tom Hamburger, 
Laurie McKinley, and David S. Cloud:

       For the businesses that invested more money than ever 
     before in George W. Bush's costly campaign for the 
     presidency, the returns have already begun.
       MBNA America Bank was one of the largest corporate donors 
     to the Bush campaign and other GOP electoral efforts last 
     year. The bank and its employees gave a total of $1.3 
     million, according to the Center for Responsive Politics, a 
     nonpartisan clearinghouse here. Charles Cawley, MBNA's 
     president, was a member of the Bush ``pioneers,'' wealthy 
     fund-raisers who each personally gathered at least $100,000 
     for the presidential campaign.

  I guess I am not going to get any support from the pioneers in my 
Senate race.

       Mr. Cawley hosted Bush fund-raising events at his home in 
     Wilmington, Del., last year and, in 1999, at his summer home 
     in Maine, north of the Bush family retreat in Kennebunkport.

  This whole piece--you get the point--is all about huge amounts of 
money, lobbying coalitions, access, and influence.
  I ask unanimous consent that both of these articles by Mr. Hamburger 
in the Wall Street Journal be printed in the Record.
  There being no objection, the articles were ordered to be printed in 
the Record, as follows:

                     [From the Wall Street Journal]

Influence Market: Industries That Backed Bush are Now Seeking Return on 
   Investment--Tobacco Wants to Kill a Suit, Oil to Drill in Alaska; 
         Patient Privacy Targeted--White House Stresses Merits

         (By Tom Hamburger, Laurie McGinley and David S. Cloud)

       Washington.--For the businesses that invested more money 
     than ever before in George W. Bush's costly campaign for the 
     presidency, the returns have already begun.
       MBNA America Bank was one of the largest corporate donors 
     to the Bush campaign and other GOP electoral efforts last 
     year. The bank and its employees gave a total of about $1.3 
     million, according to the Center for Responsive Politics, a 
     nonpartisan clearinghouse here. Charles Cawley, MBNA's 
     president, was a member of the Bush ``pioneers,'' wealthy 
     fund-raisers who each personally gathered at least $100,000 
     for the presidential campaign.
       Mr. Cawley hosted Bush fund-raising events at his home in 
     Wilmington, Del., last year and, in 1999, at his summer home 
     in Maine, north of the Bush family retreat in Kennebunkport. 
     At the Maine affair, 200 guests gathered in the early evening 
     on the large porch of the Cawley home, situated on a hill 
     with a sweeping view of the Atlantic Ocean. Guests sipped 
     cocktails and heard a brief talk by the candidate.
       The money didn't stop on election day. Mr. Cawley and his 
     wife each gave the maximum of $5,000 to help fund Mr. Bush's 
     fight in the Florida vote recount. Mr. Cawley gave an 
     additional $100,000 to the Bush-Cheney inaugural committee, 
     the most the committee would take from a single donor.
       Last week, MBNA's investment began paying off. The company, 
     one of the nation's three largest credit-card issuers, has 
     been pushing for years to tighten bankruptcy laws that allow 
     certain consumers filing for court protection, in effect, to 
     disregard obligations to credit-card companies and other 
     unsecured lenders. On Wednesday, the White House announced 
     that President Bush would sign a bill now moving through 
     Congress that would make it tougher for consumers to escape 
     such debts. If enacted, the measure could translate into an 
     estimated tens of millions of dollars in additional annual 
     earnings for each of the big credit companies.
       MBNA's vice chair, David Spartin, says his firm has no way 
     to estimate how the legislation would affect the company's 
     bottom line. MBNA has backed the bill for years ``because we 
     think it is good for consumers,'' as it will ``reduce the 
     cost of credit for everyone,'' Mr. Spartin says. The 
     donations to President Bush and other candidates were made 
     because ``we think they would make excellent public 
     officials,'' he adds. No MBNA official ``has ever spoken to 
     President Bush about the bill,'' Mr. Spartin says.
       Many corporations feel like a new day is dawning in 
     Washington. ``We have come out of the cave, blinking in the 
     sunlight, saying to one another, `My God, now we can actually 
     get something done,' '' says Richard Hohlt, Washington 
     lobbyist for several other major banks which, like MBNA, are 
     backing an industry coalition whose members provided some $26 
     million to Republicans during the 1999-2000 campaign cycle.
       President Clinton last year vetoed a similar bill that 
     would have toughened bankruptcy law. Consumer groups argue 
     that such legislation would weaken protection for working 
     families, many of whom have been the targets of aggressive 
     credit-card marketing.
       Also in action last week were members of a large coalition 
     of Mr. Bush's business backers who want to roll back new 
     federal rules designed to protect workers from repetitive-
     motion injuries.
       In a private meeting with congressional leaders last 
     Tuesday, President Bush signed off on a plan to kill the 
     ergonomic regulations, using the powers of the Congressional 
     Review Act. That act, passed in 1996, gives Congress 60 days 
     to reject regulations issued by federal agencies. But it was 
     never used during Mr. Clinton's term because to take effect, 
     a resolution rejecting new rules has to be approved by the 
     president.
       Repealing the ergonomic rules ranks high on the priority 
     lists of the U.S. Chamber of Commerce, the National 
     Association of Manufacturers and the National Association of 
     Wholesaler-Distributors. The trade groups technically don't 
     endorse candidates, but each of them mounted major grass-
     roots and advertising campaigns that benefited Mr. Bush and 
     other Republicans in the 2000 elections.
       A repeal would be a particularly hard loss for organized 
     labor, which has fought for enactment of the ergonomic rules 
     for 10 years, saying they are needed to protect workers from 
     wrist, back and other injuries.
       On employee safety, consumer bankruptcy and a host of other 
     issues, Bush administration officials maintain they are 
     acting strictly on the merits, not the money. Proponents of 
     the bankruptcy bill, for example, point out that personal 
     bankruptcy filings reached a record 1.4 million in 1998. The 
     bill that would toughen the bankruptcy law won strong 
     bipartisan support in the House last week, passing 309-106.
       Business advocates maintain that the ergonomics rules 
     include an overly broad definition of ``musculoskeletal 
     disorders'' and that the new standards give employees 
     claiming to have such disorders overly generous treatment: 
     90% of their salary and benefits for up to three months.
       But a strongly as they believe in their arguments, business 
     lobbyists acknowledge it's no accident that, following their 
     massive support for the GOP, Republicans are moving quickly 
     to address some of their top issues.
       Mr. Bush ran the most costly presidential campaign in 
     American history. Donors to his campaign and the Republican 
     National Committee contributed a total of $314 million. Of 
     that, more than 80% came from corporations or individuals 
     employed by them. Al Gore and the Democratic National 
     Committee raised $213 million, receiving strong support from 
     labor organizations and their members. But more than 70% of 
     the Democratic total also came from businesses and their 
     employees.
       These totals can be seen as somewhat inflated because most 
     donors to either party

[[Page 3633]]

     work for a business. But the amounts don't include separate 
     contributions from trade associations or independent business 
     advertising. ``The role of business last year was huge, and 
     it overwhelmingly benefited Republicans,'' says Larry 
     Makinson of the Center for Responsive Politics.
       As the bankruptcy and ergonomics bills move through the 
     Senate over the next few days, business groups also will be 
     looking for early action on other key issues. Here's a 
     preview.
       With then-Vice President Al Gore and many Democratic 
     congressional candidates railing against alleged profiteering 
     by drug companies, the industry made its biggest-ever 
     contributions to the GOP cause.
       Drug companies contributed $14 million to Republican 
     campaigns over the past two years and spent an additional $60 
     million to fund their own independent political-advertising 
     campaign. Industry executives will be lobbying the new 
     administration on a wide range of issues, such as the 
     proposal to overhaul the Medicare program and include a 
     prescription-drug benefit for senior citizens. The industry 
     wants to make sure such a benefit doesn't lead to drug-price 
     controls.
       But the fight isn't likely to command center stage for many 
     months. In the meantime, drug companies will press for a 
     rewrite of federal rules protecting the privacy of patients' 
     medical records. The rules were announced with much fanfare 
     in the final weeks of the Clinton administration. The drug 
     companies recently got a sign that they, too, were making 
     progress with the new administration.
       Health and Human Services Secretary Tommy Thompson, in a 
     move that infuriated consumer groups, invited additional 
     public comments on the rules until the end of this month. The 
     industry is hoping the move will lead to more delays and, 
     ultimately, significant revisions.
       Last December, Mr. Clinton heralded the rules as ``the most 
     sweeping privacy protections ever written.'' For the first 
     time, patients would have access to their medical files and 
     could correct mistakes. Providers, such as hospitals and 
     health plans, would be required to get written permission 
     from patients to use or disclose patients' health 
     information. Providers also would have to create 
     sophisticated record-keeping systems and privacy policies to 
     document compliance with the rules.
       Hailed by privacy advocates, the rules include provisions 
     anathema to nearly every segment of the health-care industry. 
     Drug makers, HMOs, drugstore chains and hospitals say that 
     while they back the goal of increased privacy, the rules have 
     a potential cumulative price tag in the tens of billions of 
     dollars, much of it to overhaul data-collection and 
     information-technology systems.
       The companies warn that the new requirements mean that 
     pharmacies would need signed customer consents on file before 
     they could do something as simple as sending a prescription 
     home with a neighbor. The drug industry also says that 
     research critical to boosting corporate innovation and 
     tracking the safety of drugs would be inhibited. Academic 
     researchers seeking personal health information from 
     hospitals would have to get authorization from the patient or 
     undergo a special privacy review by a hospital panel.
       Privacy advocates such as Janlori Goldman of the Health 
     Privacy Project at Georgetown University counter that such 
     dire predictions are inaccurate and ``hysterical.''
       Technically, the regulations apply to the use of 
     information by hospitals, doctors, pharmacists and HMOs. But 
     they have big implications for drug companies, which depend 
     on access to that data for research and marketing. Among the 
     drug companies most concerned is Merck & Co., because of its 
     Merck-Medco unit. Like other pharmacy-benefits managers, 
     which obtain contracts from HMOs and employers to keep drug 
     costs down, Merck-Medco fears it would be hindered in its 
     ability to track physician-prescribing patterns and other 
     information.
       Taking the lead on combating the rules is the 
     Confidentiality Coalition, an industry group that meets at 
     the offices of the Healthcare Leadership Council, overlooking 
     Farragut Square, a few blocks from the White House. Dubbed 
     the ``Anti-confidentiality Coalition'' by privacy advocates, 
     the alliance has 120 members, including Merck, Eli Lilly & 
     Co., Cigna Corp. and Medtronic Inc., the big medical-device 
     maker. A core group of 20 to 30 lobbyists shows up regularly 
     for strategy sessions.
                                  ____


             [From the Wall Street Journal, Mar. 13, 2001]

       Auto Firms See Profit in Bankruptcy-Reform Bill Provision

                           (By Tom Hamburger)

       Washington.--The nation's three major auto makers are 
     always interested in making deals, and they hope to close one 
     in the U.S. Senate this week that is worth millions of 
     dollars to each of them.
       The deal lies in the bankruptcy-reform bill expected to 
     clear the Senate this week. Buried in the bill's 420 pages is 
     a section that changes the way auto loans are treated when an 
     individual declares bankruptcy, making it more likely the car 
     loans will have to be paid back in full--even while other 
     creditors collect only part of what they are owed.
       Automobile lenders and academic experts say the financing 
     arms of the large auto companies will gain hundreds of 
     millions of dollars annually if the auto-loan provision 
     remains in the final bill, despite efforts by Illinois Sen. 
     Richard Durbin and other Democrats to pull it out.
       The long-sought bill, which tightens the rules under which 
     consumers can declare bankruptcy, contains several other 
     obscure provisions that, like the one on auto loans, provide 
     special benefits to groups with the ability to influence 
     decision makers. For example, the legislation contains a two-
     paragraph section--not the subject of any hearings or public 
     debate--that could make it more difficult for Lloyd's of 
     London to collect debts from American investors in the 
     insurance firm who can show they were victims of fraud. The 
     legislation also exempts credit unions from the bill's 
     disclosure requirements for voluntary repayment plans.
       But it is the auto-loan provision that draws the loudest 
     complaints.
       ``This is one of the best examples of why this is 
     legislation that is at war with itself,'' says Brady C. 
     Williamson, who teaches at the University of Wisconsin Law 
     School and who was chairman of the National Bankruptcy Review 
     Commission in 1996 and 1997.
       The bankruptcy bill is designed to reduce the number of 
     Chapter 7 bankruptcy filings, in which consumers erase debts 
     to unsecured creditors, and increase the number of Chapter 13 
     filings, which require debtors to repay at least a portion of 
     their obligations under the supervision of a court-appointed 
     trustee.
       The auto giants gain because the proposed law would 
     eliminate the so-called cram-down rules that allow borrowers 
     entering Chapter 13 bankruptcy to repay only an automobile's 
     market value plus interest, not the full value of the 
     outstanding loan.
       Consider, for example, the situation of someone entering 
     bankruptcy who bought a car two years ago for $10,000. The 
     car is now worth $6,000, but the buyer still owes $8,000 in a 
     multiyear note to the auto dealer. Under current law, a 
     person filing for Chapter 13 bankruptcy would pay the dealer 
     the $6,000 market value and keep the car. The remaining debt 
     would be considered, along with debts owed to other unsecured 
     creditors such as retailers, credit-card firms and medical 
     providers.
       The theory behind the cram-down was that secured creditors 
     could get the value of their collateral back, cars wouldn't 
     get repossessed as often and bankruptcy filers could continue 
     to pay off at least a portion of their obligations to auto 
     lenders and other creditors under the supervision of a 
     trustee.
       But under the bill's change, says Mr. Williamson, the 
     debtor will have to devote a larger share of remaining 
     resources to satisfying the auto dealer. Many may lose their 
     cars to repossession. Others will fall in Chapter 13, which 
     already has a 66% failure rate. He worries that more 
     creditors will thus end up filing under Chapter 7, precisely 
     the outcome the bill was designed to avoid.
       Lobbyists for the major auto companies, whose financing 
     arms make loans to their customers, acknowledge encouraging 
     Michigan's former senator--now energy secretary--Spencer 
     Abraham to add the provision to the bankruptcy bill in 1999.
       ``We think cram-down is a bad idea,'' says Anne Marie 
     Sylvester, media-relations manager for GMAC North America, 
     the financing arm of General Motors Corp. ``It raises costs 
     because it forces us to accept losses, which we may have to 
     spread among our customer base. In effect, it rewards debtors 
     who don't fulfill their obligations and penalizes those who 
     follow the rules.'' She said GMAC contributed $1.6 billion to 
     GM's $5 billion earnings last year. The bill also stands to 
     benefit GM's main competitors, Ford Motor Co. and Daimler 
     Chrysler AG.
       This provision was in the bill that passed Congress last 
     year but was vetoed by then President Clinton, who said it 
     hit working families too hard. In another sign of the effect 
     a change in the presidency can make, the Bush White House has 
     formally signaled its intention to sign the bill.
       Because removal of the cram-down effectively puts auto 
     lenders ahead of other creditors, the proposed shift 
     threatened a powerful business coalition, led by credit-card 
     companies, that has been pushing for an overhaul of 
     bankruptcy law in recent years. Despite some dissent, though, 
     the coalition generally held together, says Jeff Tassey, 
     organizer of the Coalition for Responsible Bankruptcy Laws. 
     Coalition members calculated that the advantages gained by 
     auto companies were worth accepting to keep that powerful 
     constituency behind the new law.
       ``There are provisions that are important to some 
     industries that aren't important to others,'' Mr. Tassey 
     says. ``But the members took a mature approach . . . It was 
     important to have the automobile industry in there.''
       To the auto industry, the change has been needed since 
     cram-down was introduced into law in 1978. Since that law 
     passed, bankruptcy rates have gone up nearly 800% and 
     automobile companies, which make a significant portion of 
     revenue from lending, were upset about the losses.
       They argued that eliminating cram-down will make the 
     overall system more disciplined, helping all creditors. Mr. 
     Tassey

[[Page 3634]]

     says that cram-down works as an incentive to enter Chapter 13 
     bankruptcy and argues that removing it will ``be a deterrent 
     to filing specious bankruptcies.''
       But opponents scoff at those arguments. ``This is the worst 
     provision in this bill for those who want to induce people to 
     pay their debts back,'' says Henry Hildebrand of Nashville, 
     Tenn., chairman of the legislative- and legal-affairs 
     committee of the National Association of Chapter 13 Trustees.
       As Mr. Hildebrand and others see it, the legislation will 
     hurt all creditors, and will run contrary to the intent of 
     the law's proponents. He cites studies by his organization 
     showing that a fifth of Chapter 13 debtors would be driven 
     into Chapter 7, where they can discharge or liquidate credit-
     card and other unsecured debt.
       And in the Senate last week, Sen. Durbin launched his 
     effort to remove the auto section from the final bill, or at 
     least modify it significantly.
       ``This provision is unjustly tipped in favor of the 
     creditor, providing little or no protection for debtors,'' 
     Mr. Durbin says. ``A person who want to keep their car and go 
     to work ends up being a loser.''
       The bankruptcy coalition's Mr. Tassey, though, dismisses 
     the critics: ``The bankruptcy establishment likes the system 
     the way they have been running it,'' he says.

                         A Stake in Bankruptcy

SOFT MONEY, PAC AND INDIVIDUAL CONTRIBUTIONS BY MEMBERS OF THE COALITION
                     FOR RESPONSIBLE BANKRUPTCY LAWS
                        (In thousands of dollars)
------------------------------------------------------------------------
                                        To           To
           Organization             Democrats   Republicans     Total
------------------------------------------------------------------------
American Bankers Association.....      $588.90    $1,109.60    $1,709.50
Credit Union National Association       763.40       873.04     1,642,44
Ford Motor.......................       208.47       548.21       772.13
DaimlerChrysler..................       161.03       483.08       700.11
General Motors...................       172.20       502.83       688.80
America's Community Bankers......       201.57       334.85       536.42
Independent Bankers Association..       164.62       261.25       429.47
Visa USA.........................       172.25       167.85       340.10
National Retail Federation.......        28.50       204.78       233.28
American Financial Services              38.84       155.73       194.57
 Association.....................
Mastercard International.........        11.60        82.60        96.65
Consumer Bankers Association.....        10.25        13.00        23.25
                                  --------------------------------------
      Total (in millions)........        $2.52        $4.74        $7.37
------------------------------------------------------------------------
Note: Numbers don't add up because some contributions went to non-
  partisan causes.
Sources: The Center for Responsive Politics, Federal Election
  Commission.

  Mr. WELLSTONE. Mr. President, I also ask unanimous consent that a New 
York Times piece--all of these articles are dated Tuesday, March 13, 
2001--be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                [From The New York Times, Mar. 13, 2001]

                 Lobbying On Debtor Bill Pays Dividend

                           (By Philip Shenon)

       Washington, March 12.--A lobbying campaign led by credit 
     card companies and banks that gave millions of dollars in 
     political donations to members of Congress and contributed 
     generously to President Bush's 2000 campaign is close to its 
     long-sought goal of overhauling the nation's bankruptcy 
     system.
       Legislation that would make it harder for people to wipe 
     out their debts could be passed by the Senate as early as 
     this week. The bill has already been approved by the House, 
     and Mr. Bush has pledged to sign it.
       Sponsors of the bill acknowledge that lawyers and lobbyists 
     for the banks and credit card companies were involved in 
     drafting it. The bill gives those industries most of what 
     they have wanted since they began lobbying in earnest in the 
     late 1990's, when the number of personal bankruptcies rose to 
     record levels.
       In his final weeks in office, President Bill Clinton vetoed 
     an identical bill, describing it as too tough on debtors. But 
     with the election of Mr. Bush and other candidates who 
     received their financial support, the banks and credit card 
     industries saw an opportunity to quickly resurrect the 
     measure.
       In recent weeks, their lawyers and lobbyists have jammed 
     Congressional hearing rooms to overflowing as the bill was 
     redebated and reapproved. During breaks, there was a common, 
     almost comical pattern. The pinstriped lobbyists ran into the 
     hallway, grabbed tiny cell phones from their pockets or 
     briefcases and reported back to their clients, almost always 
     with the news they wanted to hear.
       ``Where money goes, sometimes you see results,'' 
     acknowledged Representative George W. Gekas, a Pennsylvania 
     Republican who was a sponsor of the bill in the House. But 
     Mr. Gekas said that political contributions did not explain 
     why most members of Congress and Mr. Bush appeared ready to 
     overhaul the bankruptcy system.
       ``People are gaming this system,'' Mr. Gekas said, 
     describing the bill as an effort to end abuses by people who 
     are declaring bankruptcy to wipe out their debts even though 
     they have the money to pay them. ``We need bankruptcy 
     reform.''
       Among the biggest beneficiaries of the measure would be 
     MBNA Corporation of Delaware, which describes itself as the 
     world's biggest independent credit card company. Ranked by 
     employee donations, MBNA was the largest corporate 
     contributor to the Bush campaign, according to a study by the 
     Center for Responsive Politics, an election research group.
       MBNA's employees and their families contributed about 
     $240,000 to Mr. Bush, and the chairman of the company's bank 
     unit, Charles M. Cawley, was a significant fund-raiser for 
     Mr. Bush and gave a $1,000-a-plate dinner in his honor, the 
     center said. After Mr. Bush's election MBNA pledged $100,000 
     to help pay for inaugural festivities.
       MBNA was obviously less enthusiastic about the candidacy of 
     former Vice President Al Gore, Mr. Bush's Democratic rival; 
     according to the center, only three of the company's 
     employees gave money to the Gore campaign, and their 
     donations totaled $1,500.
       The center found that of MBNA's overall political 
     contributions of $3.5 million in the last election 86 percent 
     went to Republicans, 14 percent to Democrats. The company, 
     which did not return phone calls for comment, made large 
     donations to the Senate campaign committees of both political 
     parties--$310,000 to the Republicans, $200,000 to the 
     Democrats.
       MBNA's donations were part of a larger trend within the 
     finance and credit card industries, which have widely 
     expanded their contributions to federal candidates as they 
     stepped up their lobbying efforts for bankruptcy overhaul.
       According to the Center for Responsive Politics, the 
     industries' political donations more than quadrupled over the 
     last eight years, rising from $1.9 million in 1992 to $9.2 
     million last year, two-thirds of it to Republicans.
       Kenneth A. Posner, an analyst for Morgan Stanley Dean 
     Witter, said that the bankruptcy bill would mean billions of 
     dollars in additional profits to creditors, and that it would 
     raise the profits of credit card companies by as much as 5 
     percent next year. In the case of MBNA, that would mean 
     nearly $75 million in extra profits in 2002, based on its 
     recent financial performance.
       The bill's most important provision would bar many people 
     from getting a fresh start from credit card bills and other 
     forms of debt when they enter bankruptcy. Depending on their 
     income, it would bar them from filing under Chapter 7 of the 
     bankruptcy code, which forgives most debts.
       Under the legislation, they would have to file under 
     Chapter 13, which would require repayment, even if that meant 
     balancing overdue credit card bills with alimony and child-
     support payments.
       Consumer groups describe the bill as a gift to credit card 
     companies and banks in exchange for their political largess, 
     and they complain that the bill does nothing to stop abuses 
     by creditors who flood the mail with solicitations for high-
     interest credit cards and loans, which in turn help drive 
     many vulnerable people into bankruptcy.
       ``This bill is the credit card industry's wish list,'' said 
     Elizabeth Warren, a Harvard law professor who is a bankruptcy 
     specialist. ``They've hired every lobbying firm in 
     Washington. They've decided that its time to lock the doors 
     to the bankruptcy courthouse.''
       The bill's passage would be evidence of the heightened 
     power of corporate lobbyists in Washington in the aftermath 
     of last year's elections, which left the White House and both 
     houses of Congress in the hands of business-friendly 
     Republicans.
       Last week, corporate lobbyists had another important 
     victory when both the Senate and the House voted to overturn 
     regulations imposed during the Clinton administration to 
     protect workers from repetitive-stress injuries.
       Credit card companies and banks would not be the only 
     interests served by the bankruptcy bill. Wealthy American 
     investors in Lloyd's of London, the insurance concern, have 
     managed through their lobbyists to insert a provision in the 
     bill that would block Lloyd's from collecting millions of 
     dollars that the company says it is owed by the Americans.
       Lloyd's has hired its own powerful lobbyist, Bob Dole, to 
     help plead its case on Capitol Hill. Last week, the chief 
     executive of Lloyd's was in Washington to plot strategy.
       The issue involves liabilities incurred by Lloyd's in the 
     1980's and 1990's when it was forced to pay off claims on 
     several disasters, like the Exxon Valdez oil spill. Investors 
     in Lloyd's are expected to share both its profits and its 
     losses, but the Americans have refused to settle the debts, 
     claiming they were misled by Lloyd's.
       As he watched consumer-protection amendments to the 
     bankruptcy bill fail by lopsided margins last week, Senator 
     Patrick J. Leahy of Vermont, the ranking Democrat on the 
     Judiciary Committee and a leading critic of the bill, said 
     that colleagues had told him privately that they were 
     ``committed to the banks and credit card companies--and they 
     are not going to change.
       ``Some of them do this because they think it's the right 
     thing to do,'' Mr. Leahy said.
       But he said other senators were voting for the bill because 
     they know that the banks and credit card companies ``are a 
     very good source'' of political contributions. ``I always

[[Page 3635]]

     assume senators are doing things for the purest of motives,'' 
     he added, his voice thick with sarcasm. ``But I have never 
     had credit card companies show up at my fund-raisers, and I 
     don't think they ever will.''
       Mr. Gekas said the implication that money was buying 
     support for the bankruptcy bill was insulting, and that the 
     bill did most consumers a favor by ending practices by some 
     debtors that had forced up interest rates for everybody else. 
     ``Bankruptcies are costly to all of us who don't go 
     bankrupt,'' Mr. Gekas said.
       In the late 1990's, banks, credit card industries and 
     others with an interest in overhauling the bankruptcy system 
     formed a lobbying group, the National Consumer Bankruptcy 
     Coalition, for the purpose of pushing a bankruptcy-overhaul 
     bill through Congress.
       They said they needed to act to deal with what was then a 
     record number of personal bankruptcy filings. According to 
     court records, the number of personal bankruptcies hit nearly 
     1.4 million in 1998, a record up from 718,000 in 1990. The 
     number fell to just under 1.3 million last year, although it 
     is expected to rise again if the economy continues to sour.
       The coalition's founders included Visa and Mastercard, as 
     well as the American Financial Services Association, which 
     represents the credit card industry, and the American Bankers 
     Association.
       The Center for Responsive Politics found that the 
     coalition's members contributed more than $5 million to 
     federal parties and candidates during the 1999-2000 election 
     campaign, a 40 percent increase over the last presidential 
     election.

  Mr. WELLSTONE. By the way, there was also a piece on this on National 
Public Radio this morning. There is another piece by Mr. Samuelson in 
the Washington Post this morning. His argument is that it is not so 
much that it is a bad bill--I think because I had to skim read it; I 
was in a rush--he was saying that at a time with an economic downturn, 
there may now be more people filing bankruptcy. Actually, it has fallen 
off over the last year and a half, but that may happen again, and we 
are going to make it really difficult for a whole lot of people in very 
difficult economic circumstances to rebuild their lives. Mr. Samuelson 
was saying he questioned the timing of this bill.
  The New York Times piece is: ``Lobbying On Debtor Bill Pays 
Dividend.'' That is a headline that should give ordinary citizens, the 
people of Minnesota and the country, a whole lot of faith in our 
political process. ``Lobbying On Debtor Bill Pays Dividend'':

       A lobbying campaign led by credit card companies and banks 
     that gave millions of dollars in political donations to 
     members of Congress and contributed generously to President 
     Bush's 2000 campaign is close to its long-sought goal of 
     overhauling the Nation's bankruptcy system.

  It goes on to talk about all of the breaks the credit card industry 
is going to get, that all of the money they put into politics is going 
to pay a huge dividend in terms of support.
  By the way--this is interesting as well--while I probably have been 
one of the strongest critics of President Clinton, it is interesting 
that this piece about the support from all of the financial 
contributions paying off--I think one reason my colleagues are in such 
a rush to pass this bill is to show now we have a President who is 
going to sign the bill as opposed to veto the bill because we could not 
override the veto.
  President Clinton, wherever you are, with whatever kind of tough 
stories you have had to deal, with whatever you have done by way of 
pardons that may not be right that I do not agree with, I want you to 
know that as a Senator I thank you for standing up to all of these big 
contributors, to all of these interests, to the financial services 
industry. It wasn't easy to do, and you did it. Thank you, President 
Clinton.
  I am not at all surprised President Bush cannot wait to sign this 
bill. This is his crowd, as my good friend Fritz Hollings from South 
Carolina would say. This is his crowd. I am sure he cannot wait to sign 
the bill.
  Let me go to this amendment which I do not think my colleagues want 
to vote on up or down. I thought when I modified it we had at least an 
implicit understanding we would have an up-or-down vote, but they do 
not want to vote on this amendment, and I do not blame them. I would 
not want to vote against this amendment either.
  This amendment is an amendment that deals with the predatory lending 
which targets low- and moderate-income families.
  This bankruptcy ``reform'' bill, does it have much that deals with 
predatory lending practices? No. Does it call on the credit card 
industry--broadly defined--to perhaps take some accountability for 
pumping credit cards on our children and all sorts of other people who 
then find themselves in trouble and have to file for bankruptcy? No.
  I will tell you what it does do. It makes it very difficult for a 
whole lot of people who find themselves in desperate financial straits 
to file for chapter 7, and, for that matter, it goes beyond the means 
test. There are provisions in this 50-page bill plus that make it 
really hard for ordinary people to get relief and rebuild their lives. 
That is absolutely outrageous.
  I believe somebody needs to challenge this rush to get this done. We 
may have a cloture vote. We are going to have a cloture vote this 
afternoon, I take it. Colleagues should vote against it. There are a 
number of Senators who want to have amendments and want to have a vote 
on amendments, and they are right.
  By the way, I did not file for cloture. That was the majority leader. 
My understanding is there is going to be a cloture vote, and my 
understanding is Senators would have a chance to have votes on their 
amendments. That was my understanding. That is what should happen. 
There are some substantive amendments that deal directly with 
alternatives to this harsh bill.
  I want to know why we are not going to have votes on those 
amendments--I mean major amendments. And this amendment I think is also 
a major amendment, but I know other colleagues, who have worked on this 
many more years than I have and have more expertise, probably have even 
more important amendments. What do you think about this one? This 
amendment will prevent claims in bankruptcy on high-cost transactions 
in which the annual interest rate--if you are ready for this--exceeds 
100 percent. These are payday car title pawns. It is an extremely small 
amount. These are low-income folks who pay this price who are having a 
difficult time because someone was ill and had to go to the doctor and 
they do not have much margin month to month. Go for a loan and you are 
extended a small amount, $100 to $500, for an extremely short time, 1 
or 2 weeks. The loans are marketed as giving the borrower a little 
extra until payday.
  The loan works like this, if you can believe these loan sharks, these 
vultures. The borrower writes a check for the loan amount, plus a fee. 
The lender agrees to hold on to the check until the agreed upon date 
and give the borrower the cash. On the due date, the lender either 
cashes the check or, as quite often it happens, allows the borrower to 
extend the loan by writing a new check for the loan amount, plus an 
additional fee. Calculated on an annual basis, these fees are 
exorbitant. For example, a $15 fee on a 2-week loan of $100 is an 
annual interest rate of 391 percent. Rates as high as 2,000 percent per 
year have been reported on these loans.
  Why in the world do we want to allow claims in bankruptcy for these 
kinds of credit transactions? Why are we in such a rush to support 
these sleazy loan sharks? Can somebody come out on the floor of the 
Senate and tell me what the goodness is in what they do? Can somebody 
give me one good argument why you don't want to vote up or down on this 
amendment? I am indignant. I have to be careful not to get too hot. I 
am really angry.
  Let me talk about the other area that is so egregious. Car title 
pawns are 1-month loans secured by the title to the vehicle by the 
borrower. Please remember, Senators, these are not our sons and 
daughters or brothers or sisters or our wives or husbands. I am talking 
about poor people. We, luckily by the grace of God, or by luck of 
another kind, are not in this position. We don't have to put our car up 
for collateral. We don't live month by month on meager incomes and 
desperate to get credit. That doesn't happen to us.
  A typical title pawn costs 300 percent interest, and consumers who 
miss the payments have their cars repossessed. In some States, 
consumers do not receive the proceeds from the sale of the

[[Page 3636]]

repossessed vehicle even if the value of the car exceeds the amount of 
the loan.
  The Presiding Officer knows all about this because of his position in 
the State of Florida. For example, a borrower might put up their $2,000 
car as collateral for a $100 car title loan and an outrageous interest 
rate, and if the borrower defaults, the lender can take the car, sell 
it, and keep the full $2,000 without returning the excess value to the 
borrower.
  And we want to protect these loan sharks? Members don't want to vote 
for this amendment? Members want to come second-degree this amendment? 
Why?
  These schemes actually are more lucrative if the borrower defaults. 
Often the borrower--are you ready for this?--is required to leave a set 
of keys to the car with the lender, and if the borrower is even 1 day 
late with the payment, he or she might look out the window and find the 
car is gone.
  This amendment would prohibit claims in bankruptcy for credit 
transactions such as these payday loans and car title pawns where they 
charge over 100 percent interest in a year.
  Could somebody explain to me why this is a bad amendment? Could 
somebody defend these sleazy loan sharks? So far, no one has.
  There is no question these high-interest-rate loans take advantage of 
working people. On the face of it, paying 300 percent or 500 percent or 
800 percent for a $100 loan or $200 loan is unconscionable. No fully 
informed person with a choice would do it. But that is exactly the 
issue: These folks may not always have a choice.
  I am sorry I believe this has been happening over and over again in 
the last couple of weeks. This is similar to the ergonomics standard. 
This is a class issue. These are poor people we are talking about. None 
of us is ever put in this situation.
  President Bush, whatever happened to compassionate conservatism? My 
Republican colleagues, whatever happened to compassionate conservatism?
  Often these borrowers turn to payday lenders and car title pawns 
because they can't get enough credit through the normal channels. So 
these borrowers are a captive audience, unable to shop around to seek 
the best interest rates, uninformed about choices, unprotected from 
coercive collection practices.
  I thank the Chair for having the graciousness to face me while I 
speak. I always thought that was important. I thank the Chair. It is 
much harder to speak when the presiding Chair is reading or not paying 
attention. I thank the Chair for his graciousness. When I shout, I am 
not shouting at the Presiding Officer.
  There is no way the borrower can win. At best, they are robbed by 
high interest rates, and at worst their lives are ruined by the $100 
loan which spirals out of control. These loans are patently abusive. 
They should not be protected by a bankruptcy system. Because they are 
so extensive, they should be completely dischargeable in bankruptcy so 
the debtors can get a true fresh start and so that more responsible 
lenders' claims are not crowded out by the shifty operators.
  Colleagues, vote for this amendment because you are for responsible 
lenders. Vote for this amendment. I call this the responsible lender's 
amendment. Why should unscrupulous lenders who have equal standing in 
bankruptcy court with a community bank or a credit union that tries to 
do right by their customers? Why do we give equal value to these sleazy 
loan sharks with community banks or credit unions?
  By the way, I don't think these lenders should be able to take 
advantage of customers' vulnerability through harassment or coercion, 
but that was considered to be a terrible provision. That challenged 
jurisdiction in another committee, so I even dropped the language on 
the coercive practices.
  My amendment simply says if you charge interest over 100 percent on a 
loan, and if the borrower goes bankrupt, you cannot make a claim on 
that loan or the fees from the loan. In other words, the borrower's 
slate is wiped clean of your usurious loan and he gets a fresh start.
  Additionally, such lenders will be penalized if they try to collect--
well, no. See, there you go; there was my prepared statement. I 
shouldn't use a prepared statement. I was going to say, additionally 
such lenders will be penalized if they try to collect on their loan 
using coercive tactics, but I have taken that out. That was the 
modification my colleagues asked for, as if that would be such a 
terrible thing. And now I don't even get an up-or-down vote on the 
amendment. That is my understanding.
  This amendment is a commonsense solution to the problem I have 
described. It allows the Senate to send a message to those loan sharks. 
If you charge an outrageous interest rate, if you profit from the 
misery and misfortune of others, if you stack the deck against the 
customers so they become virtual slaves to their indebtedness, you will 
get no protection in bankruptcy court for your claims.
  As I say that, it sounds good to me. It really does. What is wrong 
with this proposition? If a lender wants to make these kinds of loans 
under this amendment, he or she can. But if he wants to be able to file 
claims in bankruptcy, he can't charge more than 100 percent interest. I 
don't believe any one of my colleagues will come to the floor to claim 
that a 100-percent interest rate is an unreasonable ceiling.
  This amendment is in the spirit of reducing bankruptcies. I think if 
it was adopted it would significantly improve the bill, and I urge its 
adoption.
  I will deal with a few more questions that have been raised. I assume 
we will have a debate on this. This whole bankruptcy bill and debate 
make me uncomfortable because one of the Senators for whom I have the 
greatest respect is Senator Grassley from Iowa--and he or another 
Senator may come out here. He is a great Senator, in my opinion. But I 
have to say one of two things is going to happen. Senators are going to 
come out here and say: Senator Wellstone, your amendment is all wrong. 
These loan sharks need the protection. We are for the loan sharks. We 
are for the 100 percent interest-plus. Or they are going to come out 
with a second-degree amendment which I fear will have the same effect 
because it will gut this amendment, in which case we will have a debate 
about that.
  But, so far, the silence has been deafening. I assume we will have 
that debate or maybe it will be accepted; I don't know. We will have a 
vote one way or the other.
  This amendment is necessary. For those who say some States are 
starting to institute regulation of payday lenders--that is true, and I 
am glad; if States do more than we do, I am all for it--more and more 
payday loans are being made over the Internet, and they cannot be 
effectively regulated by the States. In addition, payday lenders have 
explored using national bank charters to avoid State regulation. So 
both tactics require a Federal response.
  These payday lenders, if you are ready for this, are generating 35 
percent to 50 percent. The fees are grossly disproportionate to the 
risk or the profit margins would not be so high. We are talking about 
loan sharks who feed off misery and illness, all too often, and 
desperation, and low- and moderate-income people, many of them families 
headed by single parents, many of them families headed by women, many 
of them people of color, many of them urban, many of them rural--and we 
ought to be willing to stand up for these people.
  This amendment challenges Senators: Are you on the side of these 
sleazy loan sharks? Or are you willing to defend poor people in the 
United States of America?
  I am not holding the Senate up. I am waiting for the debate.
  I yield the floor. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. WELLSTONE. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 37

  Mr. WELLSTONE. Mr. President, I ask unanimous consent that I be 
allowed to bring up my amendment No.

[[Page 3637]]

37, and I then be allowed to withdraw the amendment No. 37 which 
relates to trade adjustment assistance.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. WELLSTONE. Mr. President and my good friend from Montana, the 
reason that I offered this amendment previously is because the crisis 
that we are facing in the steel industry in general is having a 
particularly devastating effect on workers in my state--and also, quite 
frankly in the state of Michigan as well.
  In the northeastern part of Minnesota--an area we call the Iron 
Range--a material called taconite is mined and then becomes an input 
into the steel production process. Taconite is basically iron ore; it's 
crushed, melted in blast furnaces, and then cast to be used to produce 
finished steel products.
  As you know, the steel industry is highly integrated. To make 
finished steel products, producers can purchase semi-finished steel or 
they can make their own semi-finished steel with taconite or iron ore. 
Due to the recent surge in dumped semi-finished steel slab imports it 
has become cheaper for steel mills to import this steel and finish it 
rather than make their own. This, coupled with the general decline in 
the U.S. steel industry, has had a devastating effect on taconite 
workers in my state and in Michigan. Just one example of many that I'm 
sure you're familiar with is LTV Corp's announcement in December that 
it was filing for bankruptcy.
  I ask unanimous consent to have this document, which sets forth the 
chronology of the major layoffs, shutdowns, etc. that have been 
devastating working families in the Iron Range of my state, printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 Chronology of Worker Dislocation in the Taconite Industry on the Iron 
                           Range in Minnesota

       In December 1999 the Iron Mining Association of Minnesota 
     (IMA) reported that 5,760 workers were employed in taconite 
     plants in Minnesota. After the announced cuts described below 
     take effect, our projections show that there will be 
     approximately 4,480 workers employed in this industry. That's 
     more than 1,200 workers laid off in one year.
       Below is a chronology of the worker dislocation we have 
     been experiencing.
       1. On May 24, 2000, the LTV Corp. announced its plan to 
     permanently close the taconite plant in Hoyt Lakes. There are 
     1,400 people who work at this plant.
       2. On December 29, 2000, LTV, the Nation's third leading 
     producer of basic steel, filed for bankruptcy court 
     protection.
       3. On December 31, 2000, National Steel Pellet Co. laid off 
     15 hourly workers and 7 salaried staff members.
       4. On January 28, 2001, Hibbing Taconite announced a six-
     week shut down, idling about 650 hourly workers.
       5. On February 16, 2001, Minnesota Twist Drill laid off 64 
     of 195 full-time employees.
       6. On February 19, 2001, Hibbing Taconite announced the 
     elimination of between 29 and 38 salaried positions.

  Mr. WELLSTONE. Mr. President, the difficulty, and the reason I 
offered my amendment, is that the previous Administration had an 
inconsistent record with respect to recognizing U.S. iron ore workers' 
eligibility to receive Trade Adjustment Assistance, despite the fact 
that they are clearly being injured by unfairly traded steel imports. 
In its most recent decision, involving a different taconite producer, a 
determination was made that low grade iron ore is not ``like or 
directly competitive with'' semi-finished steel slabs. I remain hopeful 
that a new Administration, taking a fresh look at this issue, will 
resolve the issue differently. Meanwhile, however, I was offering this 
amendment to make it explicit that taconite workers will be eligible to 
receive the trade adjustment assistance they so clearly need.
  Mr. BAUCUS. Mr. President, I want to begin by saying that I am very 
sympathetic to the plight of taconite workers described by Senator 
Wellstone. Unfortunately, the situation is not at all unusual. Taconite 
workers are an example, and unfortunately not an isolated example, of 
the fate of workers who supply critical inputs to American industries 
that face stiff import competition.
  When American workers lose their jobs because their production is 
replaced by imports of ``like or directly competitive articles,'' we 
help those workers through the Trade Adjustment Assistance Program. TAA 
provides extended unemployment benefits, retraining benefits, and job 
search and relocation benefits to workers who lose their jobs through 
the effects of trade. I am and have been a strong supporter of the 
Trade Adjustment Assistance Program for many years. But the present TAA 
program helps only the workers whom the Department of Labor determines 
produce the same product that is being imported.
  This year presents an opportunity to consider how the TAA program can 
be more effective in meeting the needs of all workers who lose their 
jobs as a result of import competition. That means recognizing that 
trade-related job losses and dislocation are devastating for all 
workers, no matter where they are in the overall production process.
  The TAA program comes up for reauthorization this year. I think that 
is the right context for addressing the problem raised today. I want to 
assure my colleague Senator Wellstone that I would look favorably on 
expanding the TAA program to cover workers, whenever imports from any 
country lead to job loss. In fact, we are already working on 
legislation in the Finance Committee which would do just that. I invite 
Senator Wellstone to work with the Finance Committee in this effort and 
to testify before the Committee when we hold hearings on TAA later this 
year. It is certainly my hope that we will be able to address the trade 
adjustment needs of taconite and other similarly situated workers, as 
we work to reauthorize and expand the TAA program this year.
  Mr. DAYTON. Mr. President and my colleagues, the Senior Senator from 
Minnesota, Senator Wellstone and Senator Baucus from Montana, I 
appreciate Senator Baucus' candor in recognizing that taconite workers 
have been inconsistently treated in the Department of Labor's 
definition of workers, eligible for Trade Adjustment Assistance. The 
efforts of taconite workers, from the Iron Range of Minnesota, to 
obtain relief from reduced production of semi-finished steel slab and 
steel plant closings, have been frustrated by how the Department of 
Labor considers the taconite industry. This is the reason Senator 
Wellstone and I introduced the Taconite Workers Relief Act. This bill 
underscores what I believe is certain: that taconite production is an 
essential part of an integrated steel-making process. Steel, no matter 
where it is made, is produced by a process initiated by iron ore or 
taconite pellets. Taconite pellets are melted in blast furnaces and 
then blown with oxygen to make steel. Every ton of imported 
semifinished steel displaces 1.3 tons of iron ore in basic domestic 
steel production.
  In Minnesota, in the mid-1990's, seven operating taconite mines and 
6,000 workers produced 45 million tons of taconite, which is 70 percent 
of the nation's supply. Today, the painful reality is that production 
cutbacks have ravaged the United States' iron ore industry. Northshore 
Mining Company announced that it would cut 700,000 tons of production; 
U.S. Steel's Minntac plant is cutting 450,000 tons; and the Hibbing 
Taconite Company is cutting 1.3 million tons of production.
  On December 29, 2000 LTV, the third largest steel producer in the 
United States, filed for bankruptcy, bringing the number of steel 
producing companies under Chapter 11 protection to nine. The closing of 
LTV permanently eliminates 8 million tons of production and 1,400 jobs 
in Minnesota. I am sure that the pain of unemployed steelworkers in 
Minnesota, and the fear of those who face an uncertain future, is 
mirrored among steelworkers in northern Michigan. This is the reason 
why Senators Levin and Stabenow are also cosponsors of the Taconite 
Workers Relief Act.
  The men and women of the Iron Range, who have worked for generations 
in the iron ore mines of northeastern Minnesota, are members of long 
standing in the union of the United Steelworkers of America. These are 
hard working people who believe

[[Page 3638]]

that America's steel industry is a basic industry, essential to the 
economic and national security of our country. These are people, with 
an unwavering work ethic, who understand that the steel industry is 
highly integrated, and who believe they are part of that industry. This 
is the reason I want to work to ensure the Department of Labor clearly 
recognizes the eligibility of taconite workers for TAA, and I also 
believe that eligibility should be retroactive to include workers 
permanently laid off in the past year.
  I commend the leadership of Senator Baucus in offering to support the 
expansion of TAA to cover taconite workers. I stand firmly on the 
principle that taconite workers must be treated equally at the trade 
table, and in the definition of eligibility for trade adjustment 
assistance. The opportunity the Senator has offered within the context 
of reauthorizing TAA is a wise strategy. I will join the Senator in 
working hard to eliminate any question there may be about the 
importance of taconite as part of an integrated steel industry.
  Mr. BAUCUS. I thank Senator Wellstone and Senator Dayton for their 
detailed and thoughtful presentation of the situation of taconite 
workers in Minnesota and Michigan. I also welcome their willingness to 
work with me and the Finance Committee on the reauthorization and 
expansion of the TAA program.
  Mr. GRASSLEY. Mr. President, I concur with my colleagues that the 
Trade Adjustment Assistance Act needs a thorough review to protect 
workers who lose their jobs or income as a result of import 
competition. I am committed to a top to bottom review of the Act this 
year and to work with members to make the necessary changes.
  The amendment (No. 37) was withdrawn.
  Mr. WELLSTONE. I thank the Chair.
  Mr. LEAHY. Mr. President, I thank the Senator from Minnesota.
  Mr. President, the Senator from Utah and I have been working together 
on a managers' package. We might be able to move that forward. We are 
not right at that spot yet.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. KERRY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Nelson of Nebraska). Without objection, it 
is so ordered.
  Mr. KERRY. Mr. President, I ask unanimous consent I be permitted to 
speak as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. If the Senator would just withhold, how long does the 
Senator wish to speak? We are about to do a unanimous consent request.
  Mr. KERRY. I don't know exactly. About 10 minutes or so.
  Mr. REID. Fine. It will take us that long to get things in order.
  Mr. WELLSTONE. If I could say to my colleague, with his indulgence, I 
certainly will not object, but I want to make it clear, because we are 
also in the middle of something else, that I have an amendment out 
here. I have been debating it. I am ready to hear somebody else debate 
it. I am ready to have a vote. I am not holding anything up. Democrats 
have a number of amendments to this bill that should be offered, 
debated, and voted on.
  I question what is going on here.
  Mr. KERRY. Mr. President, I am not sure which dog I have in this 
fight at the moment. I appreciate what the Senator from Minnesota is 
trying to accomplish. I gather that various people are trying to work 
on that. I certainly don't want to interrupt the flow. I will speak. If 
at some moment the Senate needs to move back to business, I will 
obviously be happy to do so.
  (The remarks of Mr. KERRY are located in today's Record under 
``Morning Business.'')
  The PRESIDING OFFICER. The Senator from Minnesota is recognized.
  Mr. WELLSTONE. Mr. President, I want to accommodate two colleagues 
who are on the floor, Senator Levin and Senator Biden, but I want to 
just be clear about what is going on here. It is 2:30. I have been 
asking for a vote on the amendment. Eight other Democrats have 
amendments on which they would like to have votes.
  The strategy on the other side is to not have votes and basically 
shut this down with a cloture vote. I want to be clear about this.
  I ask unanimous consent that my amendment be voted on within the next 
30 minutes--first of all, voted on within the next 30 minutes, with no 
second-degree amendments.
  Mr. HATCH. Mr. President, I have to object to that unless we can work 
out some matters that have to be worked out.
  Mr. WELLSTONE. If I may go on, I was going to go on and ask unanimous 
consent that the managers' package be dealt with--I would not think 
that would require a rollcall vote--and that the pending Durbin 
amendment No. 93 be dealt with. But I would like to say to Democrats--
and this is not aimed at my colleague from Utah--this is a violation of 
an agreement that we had.
  Last week, the majority leader came out here on a motion to proceed. 
I blocked it. We talked about it and said we would have substantive 
debate. We were given the assurance that before any cloture vote, we 
would have the opportunity to have our amendments down here and voted 
on. I have come out here with an amendment. I have not delayed at all. 
I still can't get a vote on this amendment after 3 days. You have 
someone such as Senator Durbin, who has been working as hard on 
bankruptcy as anybody, who can't get a vote on his amendment. This 
cloture motion should not have been filed. It is in violation of the 
agreement that was made. Any number of us are not having the 
opportunity to have up-or-down votes.
  Frankly, I would not want a vote on behalf of these payday lenders, 
these sleazeball shark lenders, myself. We ought to have a vote.
  Mr. HATCH. If the Senator will yield, Mr. President, as the Senator 
knows, we have been here for almost 2 weeks on this bill. This is a 
bill that has been modified. Some of the amendments of the other side 
have been agreed to. Some have been on the floor.
  This bill passed 70-28 last December. Frankly, there appears to us to 
be an effort to have amendment after amendment, and some of these 
amendments are not even germane. In fact, quite a few of them are not 
germane. Our side exercised a prerogative of the rules to file cloture, 
to end what really is a debate that is going out of bounds.
  Mr. REID. Will the Senator yield?
  Mr. HATCH. Excuse me, if I may finish. I would have preferred not to 
have filed cloture. I would have preferred to agree to a small number 
of amendments and we go forward on those amendments and then have a 
vote on final passage, but we were not able to get that agreement, or 
at least have not been able to up to now. As far as I know, there is 
only one Senator stopping that agreement.
  I say this to my distinguished friend from Minnesota: As far as I am 
concerned, I have no real objection to the Senator proceeding on his 
amendment and having a vote prior to the cloture vote. I prefer to 
vitiate the cloture vote. If the Senator feels aggrieved, I am going to 
try to accommodate him, but I hope our colleagues on both sides will be 
willing to work with us to get this bill completed because it is an 
important bill.
  Yes, there are a variety of viewpoints in this bill, but this is a 
very important bill. We believe we have bent over backwards to try to 
work it out with both sides in this matter.
  I ask unanimous consent--I hope the distinguished Senator from 
Minnesota will listen--that a vote occur in relation to the pending 
Wellstone amendment No. 36, as I understand it, as modified, at 3:40 
p.m. today, and the time between now and then be equally divided and no 
second-degree amendments be in order prior to the vote, and at some 
point it be in order to lay aside the amendment for up to 5 minutes for 
consideration of a managers' amendment.
  Mr. REID. Reserving the right to object, I appreciate the Republicans 
allowing a vote on the amendment of the

[[Page 3639]]

Senator from Minnesota. We have now approximately 1 hour 5 minutes. I 
am told the Senator from Minnesota wishes to speak an additional period 
of time on his amendment. The Senator from Delaware, who is the ranking 
member on the Foreign Relations Committee----
  Mr. BIDEN. If the Senator will yield, that is fine.
  Mr. REID. The Senator from Michigan is here to talk about something 
he worked out with the chairman and ranking member. I wonder if we can 
make sure they all have an opportunity to speak. I ask the Senator from 
Minnesota how he feels about that.
  Mr. WELLSTONE. I am sorry, I did not hear.
  Mr. REID. Does the Senator have a problem with Senator Levin having 5 
minutes and the Senator from Delaware 15 minutes prior to the vote at 4 
p.m. because there are no another amendments being offered prior to 
that time?
  Mr. WELLSTONE. Reserving the right to object, I ask my colleague from 
Utah whether I may amend his unanimous consent request to assure that 
the managers' package be accepted or voted on and that the Durbin 
amendment be out here. If I may--I have the floor, if I may finish for 
a moment. I want to let my colleagues speak. It is an outrageous 
proposition here. I am not just speaking about my own amendment. I want 
a vote on my own amendment.
  Mr. HATCH. Will the Senator yield?
  Mr. WELLSTONE. If I may finish, and then I will take a question. I 
want to know why, No. 1--maybe there is something I do not know--I want 
to know whether or not there is a commitment that the managers' 
amendment will be accepted before we get a cloture vote and it gets 
clotured out, and I want to know why Senator Durbin, who has worked on 
this bill long before I understood the issue, cannot bring it out. I 
want a vote. I have been trying to have a vote on it for days. I am 
ready to have Senator Biden and Senator Levin speak and have a vote on 
my amendment right away. I want to know why.
  I ask unanimous consent that my amendment be disposed of at 3:40 p.m. 
and also Senator Durbin be allowed to come to the floor and debate his 
amendment and have a vote on the Durbin amendment as well after 3:40 
p.m. and that we either have a voice vote or recorded vote on the 
managers' package before the cloture vote.
  Mr. REID. I object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. HATCH. Will the Senator yield for a comment?
  Mr. WELLSTONE. I am not going to yield the floor, but I----
  Mr. HATCH. You already yielded the floor.
  The PRESIDING OFFICER. The Senator from Utah has the floor.
  Mr. HATCH. Let me accommodate my colleague.
  I am trying to accommodate the Senator. I am trying to be reasonable, 
and I am trying to make this matter acceptable. We have a cloture vote 
at 4. I am willing to accommodate the Senator so he can have a debate 
on his amendment equally divided until 3:40 when we vote on the 
amendment.
  Mr. WELLSTONE. Mr. President, will----
  Mr. HATCH. Let me finish. Then we will vote on that amendment, as 
modified. As I understand it, Senator Levin wants to speak--is that 
correct?--for 5 minutes, and Senator Biden wants to speak for how much 
time?
  Mr. BIDEN. Will the Senator yield for a question?
  Mr. HATCH. I will be happy to without losing my right to the floor.
  Mr. BIDEN. I am not standing here seeking recognition to speak, 
although I would like to do that at whatever time is convenient, but I 
ask the question: Isn't it fair that the request--and I strongly 
disagree with Senator Wellstone's characterization of this bill, and I 
strongly disagree with Senator Durbin's characterization of this bill, 
but are they not entitled to have a vote? I am standing here to support 
their right to have a vote before cloture. I thought that was the 
general understanding, that we would have the ability to vote on both 
those amendments before cloture.
  I do not understand why they are not being given that right. Again, I 
strongly disagree with both of them. I think there has even been a 
little bit of demagoguery on the bill. I resent some of the ways they 
have characterized the positions of some of us who support the bill, 
but I think they have a right to have a vote on their amendments. I 
thought there was an understanding.
  My question is: Was there not an understanding that we would be 
voting today prior to cloture on some of these amendments that would be 
kicked out by cloture if cloture were invoked?
  Mr. WELLSTONE. Will the Senator yield?
  Mr. BIDEN. I cannot yield. The Senator from Utah has the floor. I 
asked a question so I cannot yield. That is my question.
  Does it also not make sense for the legitimacy of the cloture vote to 
let them have their votes on both those amendments?
  Mr. HATCH. I am not aware of the promise to Senator Durbin, but I am 
trying to accommodate the distinguished Senator. We have a limited time 
prior to the cloture vote.
  Mr. BIDEN. I ask unanimous consent----
  Mr. HATCH. Will the Senator withhold?
  The PRESIDING OFFICER. The Senator from Utah has the floor.
  Mr. HATCH. Will the Senator withhold before I ask unanimous consent 
myself? I am trying to accommodate the distinguished Senator from 
Minnesota. If Senator Durbin wants to come to the floor and do his 
amendment, personally I do not have any objection to that. Let me check 
with our side and make sure we can do that, as long as we have an 
opportunity to amend the Durbin amendment.
  Would it be possible to cut down the time so we could accommodate 
both amendments before the vote?
  Mr. WELLSTONE. Absolutely. That has been my point.
  Mr. HATCH. If you will be willing to take less time, we can allow 5 
minutes for Senator Levin; and how much time does the Senator from 
Delaware need?
  Mr. BIDEN. If the Senator will yield, I am not asking for any time to 
speak on NATO--that is what I want to speak on--because I thought this 
was a dead period. It is kind of a dead period for different reasons.
  I ask the Senator to consider the request. If the Senator from 
Minnesota is willing to knock down his time--the Senator can speak for 
himself--the staff of the Senator from Illinois tells me he will be 
willing to cut down his time as well so they both can get a vote on 
their amendments prior to 4 o'clock.
  What I am asking the Senator from Utah, whom I support on this bill, 
is to give them a chance, if they will cut down their time, to have a 
vote on both of their amendments. That is my request of the Senator 
from Utah. They are both here and can speak for themselves, obviously, 
better than I can.
  Mr. HATCH. Let me suggest the absence of a quorum, and I will 
immediately see if I can get this done.
  Mr. LEVIN. Will the Senator withhold so I may speak?
  Mr. HATCH. I ask unanimous consent that the Senator from Michigan be 
given 5 minutes and then the floor come back to me at the conclusion of 
his remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEVIN. Mr. President, I thank my good friend from Utah. I was 
going to offer an amendment on behalf of Senator Feinstein and myself. 
It is amendment No. 91 at the desk. It is similar to an amendment 
adopted last Congress during debate of the bankruptcy bill, which was 
deleted during negotiations with the House of Representatives. I am not 
going to offer this as an amendment to this year's bankruptcy bill but, 
rather, introduce it as a freestanding bill because of the agreement of 
Senator Gramm, who is the chairman of the Banking Committee, to hold a 
hearing on our bill when it is filed as a freestanding bill.
  When it is introduced, it will be referred to his committee. However, 
I want to spend 1 or 2 minutes explaining what this amendment is all 
about.

[[Page 3640]]

  What credit card companies do now is charge interest to people, even 
though they pay part of their indebtedness on time.
  It would be fine if they were just charging interest on part of the 
indebtedness which was outstanding and not paid on time. That is 
perfectly appropriate. But if somebody, for instance, starts with a 
zero balance, charges $1,000 on their credit card, pays $900 on time by 
the due date, then that person is not only charged interest on the $100 
owed, that person is charged interest on the full $1000, even the part 
of his bill that is paid by the due date.
  I don't know any other situation where somebody who pays an 
obligation on time is nonetheless charged interest on the part that is 
paid.
  Again, our bill will address this by addressing the imposition of 
interest for on-time payments during the so-called ``grace period.'' 
Currently, credit card lenders use complicated definitions of ``grace 
period'' to allow interest charges for payments even if they are made 
on time. Credit card lenders define ``grace period'' as applicable only 
if the balance is paid in full. Mastercard, for example, defines their 
``grace period'' as ``a minimum of 25 days without a finance charge on 
new purchases if the New Balance if paid in full each month by the 
payment due date.'' That means that even if a person pays 90 percent of 
his balance, he is still charged interest on money which is timely 
paid.
  This is an overreach by the credit card companies. It should be 
corrected by the credit card companies. Most credit card customers, 
when they send in a check to pay their credit card on time, fairly 
assume they will not be charged interest on the money paid. But in fact 
they are, unless they happen to pay off the entire amount of their 
obligation. It is unfair. It is an overreach. It ought to be corrected 
by the credit card companies themselves. If it isn't, our bill will 
correct it for them.
  Credit card companies are adding new and higher fees all the time in 
the small print of their lending terms. According to Credit Card 
Management, late fees, balance transfer fees, over-limit fees, and 
other penalty fees were a source of $5.5 billion in revenue for credit 
card companies in 1999, up from $3.1 billion in 1995.
  Hopefully, the credit card companies will correct this overreach 
themselves, and this bill will not be necessary, but the chairman of 
the Banking Committee has indicated he is willing to hold a hearing on 
this bill and on similar practices by the credit card companies that 
might be brought to the attention of the Banking Committee, and based 
on that agreement by the Senator from Texas, I will not be offering 
this amendment on the bankruptcy bill but instead will be offering a 
freestanding bill on behalf of Senator Feinstein and myself.
  I thank the Chair. I thank the Senator from Utah for yielding me this 
time. I will not offer the amendment, and I withdraw the amendment at 
this time.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
amendment is recalled.
  Mr. HATCH. Mr. President, I ask unanimous consent that the time prior 
to the vote in relation to the pending Wellstone amendment numbered 36, 
as modified, be limited to 10 minutes equally divided and no second-
degree amendments be in order prior to the vote, and following that 
time, the amendment be laid aside and Senator Durbin be recognized to 
call up his amendment No. 93, and following the reporting, Senator 
Hatch be recognized to offer a second degree, and time on both 
amendments be limited to 30 minutes equally divided.
  Further, then, these votes occur first in relation to the second 
degree to Durbin, then in relation to the Durbin amendment, as amended, 
if amended, and finally in relation to the Wellstone amendment, with 2 
minutes between each vote for explanation, and the votes to begin no 
later than 3:20, and Senator Wellstone's time as previously ordered be 
limited to 5 minutes, and the majority leader be recognized for 5 
minutes just prior to cloture.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Illinois.
  Mr. DURBIN. If I understood the unanimous consent, I can call up my 
amendment numbered 93 at this time. At some point, Senator Hatch may 
offer a second degree.
  Mr. HATCH. I ask unanimous consent the Wellstone time be reserved to 
follow the 30 minutes equally divided between Senator Durbin and 
myself.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 93

  Mr. DURBIN. Mr. President, I don't know the sequence, but I want to 
make certain we are considering amendment No. 93 that I have offered. 
Senator Wellstone has a pending amendment as well. I am prepared to 
argue my amendment.
  The PRESIDING OFFICER. The amendment is now pending.
  Mr. DURBIN. The amendment has been filed.
  The PRESIDING OFFICER. The amendment was called up earlier. It is 
pending.


                  Amendment No. 96 to Amendment No. 93

  Mr. HATCH. I send an amendment to the desk and ask for its immediate 
consideration.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Utah [Mr. Hatch] proposes an amendment 
     numbered 96 to amendment No. 93.

  Mr. HATCH. I ask unanimous consent reading of the amendment be 
dispensed with.
  Mr. DURBIN. Mr. President, I object, unless a copy is provided. We 
have no idea what is in the amendment.
  Mr. HATCH. It is on your desk.
  Mr. DURBIN. I do not object.
  Mr. HATCH. I ask unanimous consent reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER (Mr. Crapo). Without objection, it is so 
ordered.
  The Amendment is as follows:

       Strike all after the words ``Section 1'' and insert the 
     following:

  (The language of the amendment is the text of bill S. 420, as 
reported from the Committee on the Judiciary, beginning with the word 
``SHORT'' on page 1, line 3.)
  Mr. DURBIN. Mr. President, it took a few minutes to sort out what we 
are doing, and this is what it has come down to. I am offering an 
amendment to the bill before us with a bankruptcy reform bill which was 
considered 2\1/2\ years ago in the Senate and passed by a vote of 97-1.
  Senator Hatch has come back and said, instead, it is a take it or 
leave it deal. We have this bill that is presently before us--take it 
or leave it. That is what the choice will be for my colleagues in the 
Senate. But I encourage them to take a close look at the differences 
between the substitute I am offering and what is being considered today 
in this Chamber.
  This bankruptcy debate has gone on for over 4 years. A very small 
percentage of Americans will never set foot in bankruptcy court, thank 
the Lord, but those who do hope they will have a new day in their 
lives. Because of their income situations they cannot repay their 
debts. Many of these people would love to repay their debts but, 
unfortunately, they have been faced with medical bills far beyond what 
any family could take care of. They might have gone through a divorce 
and found themselves with little or no income to raise a family and all 
the bills finally stacked up and pushed them over the edge. They could 
face a situation where they have lost a job that they had for a 
lifetime and then they find themselves in bankruptcy court.
  My colleague, Senator Grassley of Iowa, spoke eloquently, when I 
offered my bill, about the need for us to change the process so the 
Senate could have bankruptcy reform. Let me read a little bit of what 
Senator Grassley said in the Congressional Record of September 23, 
1998. He said:

       Mr. President, first of all I want to thank everyone in 
     this body for the overwhelming vote of confidence on the work 
     that Senator Durbin and I have done on this bankruptcy

[[Page 3641]]

     bill. Getting to this point has been a very tough process 
     involving a lot of compromise and a lot of refinement.

  Senator Grassley went on to say:

       You heard me say on the first day of debate that for the 
     entire time that I have been in the Senate that on the 
     subject of bankruptcy--maybe not on every subject, but the 
     subject of bankruptcy--there has been a great deal of 
     bipartisan cooperation . . . this legislation has always 
     passed with that sort of tradition.

  About the amendment I am offering now, Senator Grassley went on to 
say:

       So I want to say to all of my colleagues that I not only 
     thank them for their support but, more importantly . . . that 
     tradition has continued. . . . I don't think we would have 
     had the vote that we had today if it had not been for the 
     bipartisanship that has been expressed. . . .

  The vote was 97-1. The Grassley-Durbin bankruptcy reform had 
overwhelming bipartisan support. But, on two successive occasions, that 
bankruptcy bill went into a conference committee and, frankly, never 
emerged. What came back from the conference committee was a slam dunk, 
unbalanced, one-sided bankruptcy reform that favored credit card 
companies and financial institutions, and, frankly, did little or 
nothing for consumers and families across America.
  I am pleased we have had this debate before us. But I tell you in the 
spirit that Senator Grassley spoke to the Members of the Senate on the 
floor, I have offered the very bill which he and I worked on for so 
long, the bill that passed so overwhelmingly. We already have before us 
a thoroughly researched and broadly considered bill which was found 
acceptable to virtually every Member of this body in 1998. The bill 
before the Senate now, the Bankruptcy Reform Bill, is not a balanced 
bill. The bill we have before us today is one that is tipped decidedly 
in favor of credit card companies and banks.
  There have been efforts made over the span of this debate to amend 
this bill to give consumers a fighting chance. Those efforts have 
failed. I have tried to offer an amendment, for example, which would 
require more complete disclosure on the monthly statements on credit 
cards. The credit card industry has refused. Why send a message to 
America of how divided we are in bankruptcy reform instead of coming up 
with a bipartisan bill that addresses the issue? The Senate can speak 
in a united, bipartisan voice, making clear we have reached a broad-
based consensus on bankruptcy reform.
  Let me review a few of the major differences between the bills and 
point out why I believe the bill I offer as a substitute is a much more 
balanced approach, a decision made by 96 of my colleagues and myself 
when we last voted on this.
  The Durbin amendment uses a means test that requires every debtor, 
regardless of income, who files for chapter 7 bankruptcy to be 
scrutinize by the U.S. Trustee to determine whether the filing is 
abusive. We want to stop abusive filings and those who would exploit 
the bankruptcy court. The bill creates a presumption that a case is 
abusive if the debtor, the person who owes the debt, is able to pay a 
fixed percentage of unsecured nonpriority claims or a fixed dollar 
amount.
  In my home State of Illinois, the average annual income for 
bankruptcy filers in the Central District where I live in Springfield, 
in 1998, was $20,448. Yet the average amount of debt which people 
brought into bankruptcy court was more than $22,000. It is clear that 
these people were over the edge. You can't get blood out of a turnip. 
When the credit industry wants to keep pushing and pushing and pushing 
for more and more money, they have lost sight of the reason for 
bankruptcy court. When people have reached the end of the road, it is 
time to give them a fresh start.
  This figure shows these filers were hopelessly insolvent. They owed 
more money on debt than they had in collateral and their total income 
for the entire year. They don't even come close to meeting the 
standards where they would go through the scrutiny of this bill.
  My amendment gives the courts discretion to dismiss or convert a 
chapter 7 bankruptcy case if the debtor can fund a chapter 13 repayment 
plan. What it means in simple language is this: If the court takes a 
look at the person in bankruptcy court and says, ``You can pay back a 
substantial part of this debt, we are not going to let you off the hook 
entirely,'' the Durbin amendment says: Yes, the court can reach that 
decision. And that is an appropriate decision. Everybody should try in 
good faith to pay their bills.
  But let us also concede there are some people who will never be able 
to repay these bills. Unfortunately, the amendment offered by Senator 
Hatch is one that doesn't give that kind of latitude and flexibility.
  My approach is cheaper, it is more flexible, it is more sensible, and 
it is more fair. What is the sense of applying a complicated means test 
to every bankruptcy filing when studies have clearly shown the types of 
means tests envisioned in the amendment of Senator Hatch would only 
apply to a small fraction, far less than 10 percent of the people 
filing bankruptcy? A study by the American Bankruptcy Institute put the 
figure at 3 percent. That means that 100 percent of the people filing 
in bankruptcy court would have to go through a process that only 
applies to 3 percent of them.
  Beyond the administrative costs, there is a lot of stress on poor 
families in this approach. Let me tell you why I think this bill is 
also balanced. I don't believe we should ration credit in America, but 
I believe as consumers and families across America you have a right to 
be informed, well informed about what you are getting into with a 
credit card. My amendment was more balanced in its approach. This bill 
before us, Senator Hatch's bill, does not approach credit card 
disclosure in a meaningful way. This should be a primary objective of 
bankruptcy reform: Reform the bankruptcy court, but also end some of 
the abuses of the credit card industry.
  When you go home tonight and open the mail, you know what you are 
going to find--another credit card solicitation. If you happen to be a 
college student, you are a prime target for these credit card 
companies. They want to get students with limited or no income with 
credit cards in hand, charging debts across the campus and around the 
town, many of them finding themselves in over their head in no time at 
all.
  If I want to take out a large loan at a reasonable interest rate, a 
few thousand dollars, or $100,000 as the mortgage on my home, I have to 
go through all kinds of scrutiny. The banks want to see my income tax 
forms, my bank statements, my pay stubs, and the like. But many of you 
know when you want to apply for a credit card the same tests don't 
apply.
  We have heard a lot about the democratization of credit. On the one 
hand, it is a good thing; credit should be broadly available. The 
marketplace should work in a way so everyone who needs credit has 
access. But the pendulum has swung too far in the wrong direction. 
According to BAI Global, a market research firm in Tarrytown, NY, in 
1999 Americans received 3 billion mailings advertising credit cards. 
That is more than three times the 900 million mailings in 1992, and 
those are only the ones that go through the mail. We know there are 
Internet solicitations and television and radio solicitations and 
magazine solicitations as well.
  Let me tell you a little bit about the college students. At American 
University here in Washington, DC, every time a student purchases 
something from the bookstore at American U, he or she gets this bag. At 
the bottom of this bag are four--not one, but four--credit card 
solicitations for these students every time they go into the bookstore.
  Another college has a phone-in system for registering for class. That 
sounds pretty convenient. I can remember standing in long lines when I 
had to register. But when the students come in, the first thing they 
hear from the university is a credit card solicitation. There is no 
avoiding it. If they want to register for class, the first thing they 
have to find out is whether they need a credit card. That is the most 
important question.
  When I go to a University of Illinois football game, they wave a T-
shirt at

[[Page 3642]]

me: Do you want a free T-shirt? Sure. Well, all you have to do is sign 
up for a credit card.
  Students are signing up. The dean of students tells us the No. 1 
reason kids leave school--not because of academic failure--is because 
they are in over their heads when it comes to credit cards.
  That sort of thing is absolutely indefensible. When you consider the 
fact the median family income for chapter 7 bankruptcy filers has been 
declining, it tells us that more and more people of limited means are 
taking out too many credit cards and getting in too far.
  This bill that is being offered by the credit industry says several 
things:
  First, if you get in over your head and want to file for bankruptcy, 
it is going to be tough.
  Think about this for a minute.
  There was an interesting article which appeared today in the 
Washington Post that said, ``Bad timing on the bankruptcy bill.'' If we 
are worried about confidence, and if people are worried about making 
purchases, are we going to pass the Hatch-Grassley bankruptcy bill to 
tell people if they purchase something and get in over their heads they 
are not going to be able to get out of their debt in bankruptcy court? 
Is that supposed to restore consumer confidence? Just the opposite is 
going to be true.
  I think the writer of this, Robert Samuelson, makes a very good 
point.
  One of the provisions I think we should consider is that consumers 
have more information on their monthly bill they receive from a credit 
card company--something that is clear and understandable and not 
ambiguous. The credit industry that wrote the bill before us said they 
will say to consumers across America that they will give them an 800 
telephone number so they can call if they have any questions about the 
credit card.
  When you go home tired at night and are fighting all the phone calls 
coming in, you don't want anyone to say they will give you an 800 
telephone number.
  What I suggested is something very simple, and it is a part of my 
amendment. I have a little show and tell. Let me demonstrate it.
  This is a credit card statement that came to one of the people in my 
office. As you can see, it is pretty familiar to you. It has a second 
page with all of the things we read so carefully each month to figure 
out what the terms of the credit card are.
  The concern I have is this whole question of the minimum monthly 
payment. I said to the credit card companies: When it comes to the 
minimum monthly payments on these monthly statements, could you be so 
kind as to say to the people who are being billed, if they make the 
minimum monthly payment and they don't increase their balance, how many 
months it will take for them to pay off the balance and how much will 
they have paid in principal and interest.
  I don't think that is an outrageous idea.
  This is an example of what it might look like. This says, if you make 
the minimum monthly payment, it will take you 8 months to pay off your 
current balance, and the total cost to you will be approximately $9,407 
instead of the remainder of $5,435.
  Do you know what the credit card companies told me when I suggested 
they put this information on the monthly statement? ``Impossible.'' It 
is impossible for us to calculate if they made the minimum monthly 
payment how long it would take them to pay the principal and interest.
  You know better and I know better. The technology and the computers 
are such that they can provide this in an instant. But they do not want 
people to know this. Make the minimum monthly payment, and things are 
going to be just fine. When you get in too far, why don't you 
``consolidate your debt'' and get another credit card, and pretty soon 
you are in over your head.
  Pretty soon, if this bankruptcy bill passes, they will find when they 
walk into bankruptcy court they will be stuck with these debts. They 
cannot get away from them.
  This is the greatest boon to the credit industry that has ever been 
passed by the Senate. And we are about to do it today, if we don't 
adopt the Durbin amendment.
  The PRESIDING OFFICER. The time of the Senator from Illinois has 
expired.
  Mr. DURBIN. Thank you, Mr. President.
  The PRESIDING OFFICER. The Senator from Utah is recognized.
  Mr. HATCH. Mr. President, I admire our colleague. He is very 
articulate. He is a very effective Member of this body.
  We have filed an amendment to his amendment that basically, if we 
vote for it, would enact the bill we passed last year 72-28 in the 
Senate, which I think would be a fitting conclusion to what has gone on 
here over the last number of weeks. But I know it causes heartburn for 
our colleague from Illinois. So, as a courtesy to him, I am going to 
withdraw my amendment at this time.
  I ask unanimous consent that my amendment be withdrawn. And we will 
have a vote. I will move to table the Senator's amendment at the 
appropriate time, and I will also, if he needs more time for his 
amendment, grant him some of my time.
  The PRESIDING OFFICER. Without objection, the amendment is withdrawn.
  The amendment (No. 96) was withdrawn.
  Mr. HATCH. Mr. President, let's understand the Senator's amendment. 
His amendment does not have the Schumer language in it that was passed 
yesterday. It doesn't have the Schumer language on abortion in it that 
we worked out very meticulously with the distinguished Senator from New 
York. That is very important language.
  It doesn't have the privacy language that Senator Leahy and the 
distinguished Senator from Vermont and I worked out over a long period 
of time. That is very critical language. Frankly, it is just an 
amendment that would substitute the current legislation with the 
bankruptcy reform bill that passed the Senate in the 105th Congress.
  This amendment by the distinguished Senator from Illinois is a 
transparent attempt to kill bankruptcy reform. It was hastily produced 
and does not even include the amendments to keep it current; that is, 
some of the bankruptcy judgeship provisions that have been overtaken by 
them.
  The Durbin amendment throws away 4 years of revision, compromise, and 
improvement.
  The Durbin amendment is lacking in several important areas:
  The amendment has no enforceable means test;
  The amendment does not include the improved child support provisions 
requested by the child support community;
  The amendment does not include the Leahy-Hatch ``Toysmart'' consumer 
privacy amendment;
  The amendment does not have the reaffirmation provisions in the 
current bill which substantially improved consumer protections;
  The amendment lacks the important consumer protections such as the 
``Debtors' Bill of Rights'';
  The amendment does not include 4 years of improvements for the 
financial netting provision;
  The amendment does not address the abuse of the bankruptcy system by 
those who wish to discharge debts arising from violence; that is, the 
Schumer-Hatch compromise. That is a very important part of what we hope 
will be the final bill.
  The amendment has much weaker anti-fraud provisions, such as weakened 
audit provisions and being more tolerant of repeated abusive filings.
  The amendment deletes current law provisions allowing the court to 
consider charitable contributions when making a determination as to 
whether the debtor's filing is an abuse.
  The amendment does not provide for retroactive enactment of Chapter 
12 filings--farmers--from July 1, 2000 through the date of enactment.
  The amendment would create an immediate effective date, which, given 
the scope of the legislation, is wholly inappropriate.
  The amendment lacks improvements to the small business bankruptcy 
provisions in the bill.

[[Page 3643]]

  This is a blatant effort to turn back the clock and force 
considerable renegotiation of provisions that have been negotiated in 
good faith by literally hundreds of Senators and Congresspeople over 
the last 4 years.
  Make no mistake. A vote for this substitute is a vote to kill 
bankruptcy reform.
  We oppose the Durbin amendment. I hope my colleagues on the other 
side will oppose it as well because basically it will upset everything 
we have tried to do and tried to accommodate Democrats on and 
Republicans on over the last 4 years.
  A vote for this amendment is a vote against meaningful bankruptcy 
reform. I appreciate the fact the distinguished Senator believes deeply 
and he doesn't like this bill. He is one of a few who does not like 
this bill. He is one of the 28 who voted against the bill when it 
passed last year. If anything, the bill from last year has been 
modified with amendments from the other side.
  The bill we ultimately, hopefully, will vote on and vote to invoke 
cloture on has been modified to please Members on the other side in a 
wide variety of ways.
  We have tried to accommodate our friends on the other side. I 
certainly believe I have been fair as the manager of the bill; and I 
intend to continue to be. But this amendment would work against almost 
everything we have tried to accomplish over the last 4 years.
  With that, does the distinguished Senator need some time?
  Mr. DURBIN. Yes, I do.
  Mr. HATCH. Mr. President, how much time?
  Mr. DURBIN. I do not know how much time is remaining, but if I could 
have 10 minutes.
  Mr. HATCH. Mr. President, how much time remains?
  The PRESIDING OFFICER. The Senator from Utah has 9 minutes remaining.
  Mr. HATCH. Could I give the Senator 5 minutes, and I will take 4?
  Mr. DURBIN. That would be fine. I thank the Senator from Utah for his 
courtesy.
  We have locked horns many times, but we are friends. I respect him 
very much.
  Every time Senator Hatch tells you there is a provision in the bill 
before us that is not included in the Durbin bill--believe me, every 
time the credit industry gave us a morsel, they took away a beef steak. 
And that is what happened when it was all over.
  The bill before us today is much worse on consumers in America than 
the bill this Senate passed by a vote of 97-1. And though the Senator 
from Utah tells me how terrible my bill is, he voted for it. He voted 
for it, as did most of the Senators who are here today.
  Let me read to you some comments from people I think are worth 
repeating. This first comment comes from David Broder. We know him. He 
is a respected journalist and is published in the Washington Post, and 
other newspapers. This is what he says about this bankruptcy bill I am 
trying to replace:

       As for the bankruptcy bill, it deserves the veto Clinton 
     gave it. Despite some useful provisions, it is an unbalanced 
     measure, which does nothing to curb the mass marketing of 
     credit cards to young and low-income people who perpetually 
     pay the exorbitant interest on their monthly balances. It 
     will squeeze money out of people who have been clobbered by 
     job losses, divorce or medical disasters, yet allow some 
     millionaires to plead bankruptcy while turning their assets 
     into mansions in states with unlimited homestead exemptions.
       In both cases, money interests prevailed over the public 
     interest.

  That was David Broder in this morning's Washington Post.
  Lawrence King is a law professor at New York University. I quote him:

       I fear this [bill] will end up creating an underground 
     economy. People will go off the books. They'll ask to be paid 
     in cash. They'll get a false Social Security number. They'll 
     move.
       In my 40 years of dealing with Congress on bankruptcy 
     legislation, this is the worst I've ever seen. It's the kind 
     of bill that makes you want to point your fingers at 
     individual congressmen and say, ``Shame on you.''

  This bill before us today is not balanced. If that credit industry 
will not even include a provision on your monthly statement so you can 
make an informed decision about the kind of debt which you and your 
family can face, it tells the whole story, as far as I am concerned.
  What we have offered in this substitute is a carefully crafted and 
balanced bill. It says the credit card companies have to end some of 
their abuses and that we believe that abuses in the bankruptcy court 
have to end.
  I salute my colleague and friend from New York, Senator Schumer. It 
is true that his language yesterday on predatory lending is a good 
addition to the bill. But I will tell him that the bill I am offering--
the one that passed 97-1--has my provision which directly attacks 
predatory lending.
  Who are these predatory lenders? They are people who want a second 
mortgage on your grandmother's home, that turns into a balloon payment, 
that turns into a foreclosure, that turns into a trip to bankruptcy 
court, where the home she saved for for a lifetime is lost to these 
people, these loan sharks, who take advantage of the system. Sadly, the 
financial and credit card industry came to the rescue of these loan 
sharks at the expense of elderly Americans who are being exploited by 
them.
  Senator Schumer's amendment has helped immeasurably. I assure those 
who are listening to this debate that the Durbin amendment I have 
offered today has equally powerful language when it comes to ending 
predatory lending in the United States.
  The credit industry and the financial industry oppose both measures. 
That ought to tell you the whole story about what is before us.
  We have precious few opportunities in the Congress--certainly on the 
floor of this Senate--to consider any legislation to help consumers and 
families across America. Passing the Durbin amendment will help them. 
It will provide some balance to the bill. If we should defeat this 
amendment and go back to the original bill--which is now before us--as 
David Broder and others have said, the net losers will be families 
across America facing a slowdown in this economy, who fall behind in 
their debts and end up in bankruptcy court as the targets and as the 
victims of the credit industry. That is a wrong move.
  I hope my colleagues in the Senate will join me in supporting this 
amendment.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. I will yield to the distinguished Senator from Wisconsin, 
without losing my right to the floor, for the purpose of modifying his 
amendment.
  Mr. FEINGOLD. Mr. President, I ask unanimous consent that I be 
permitted to modify amendment No. 51 with the modification I now send 
to the desk.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The submitted amendment (No. 51), as modified, is as follows:

 (Purpose: To strike section 1310, relating to barring certain foreign 
                               judgments)

       On page 439, strike line 19 and all that follows through 
     page 440, line 12.

  Mr. FEINGOLD. Mr. President, I thank the chairman for his courtesy 
and assistance.
  Mr. HATCH. Thank you.
  The PRESIDING OFFICER. The Senator from Utah.


                            Amendment No. 93

  Mr. HATCH. As I said before, the Durbin amendment would upset 4 solid 
years of negotiations between both sides of the aisle on both sides of 
Capitol Hill. It is lacking in all kinds of areas. There is no 
enforceable means test. It does not include the improved child support 
provisions that have been requested and desired by the child support 
community. It does not have the Leahy-Hatch privacy language. It does 
not have the reaffirmation provisions.
  It lacks the Debtors' Bill of Rights. It lacks 4 years of 
improvements in the financial netting provisions. It does not address 
the abuse of the bankruptcy system by those who wish to discharge debts 
arising from violence, the Schumer-Hatch compromise. It has much weaker 
antifraud provisions,

[[Page 3644]]

such as weakened audit provisions. You can just go on and on.
  It deletes current law provisions in allowing the courts to consider 
charitable contributions when making a determination as to whether the 
debtor's filing is an abuse. It does not provide for retroactive 
enactment of chapter 12 filings that benefits our farmers from July 1, 
2000, to the date of enactment.
  The amendment would create an immediate effective date which, given 
the scope of the legislation, is wholly inappropriate, and it lacks 
improvements to the small business bankruptcy provisions that are in 
the bill currently before the Senate.
  In my opinion, it is an attempt to turn back the clock and force 
considerable renegotiation of all of these provisions, and many other 
provisions, that we have worked so hard to put together over the last 4 
years.
  The bankruptcy bill is a bipartisan bill. It is not a Republican 
bill; it is not a Democrat bill. It is a bipartisan bill. We worked 
very strongly all these years to bring it about. I have to say, there 
are certain Senators in this body who have a right to do this but who 
have never wanted a change in the bankruptcy laws, at least the way the 
bill has been negotiated by the vast majority of people in both Houses 
of Congress. But a vote for this substitute is a vote to kill the 
bankruptcy bill.
  I hope, after all of these years, and all of these months, and all of 
the time we have spent on the floor on this bill, that my colleagues 
will vote to table the amendment.
  Mr. President, I yield back the remainder of my time and move to 
table the amendment, and ask for the yeas and nays. And I ask unanimous 
consent that the votes occur as we had in the original unanimous 
consent.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The clerk will call the roll.
  Mr. HATCH. No. We have to wait until the Wellstone--my motion to 
table has been approved?
  The PRESIDING OFFICER. The Chair was in error. The unanimous consent 
agreement was that we now debate the Wellstone amendment.
  Mr. HATCH. Right, before the motion to table.
  The PRESIDING OFFICER. The motion to table has been made, and the 
rollcall vote will be ordered at the appropriate time.
  The Senator from Minnesota.


                     Amendment No. 36, As Modified

  Mr. WELLSTONE. Mr. President, I have spoken about this amendment for 
some time. I have just a few minutes to summarize again. This is 
already in the Record. In addition to the Broder piece that my 
colleague, Senator Durbin, mentioned, I have the New York Times, 
Tuesday, March 13, ``Lobbying on Debtor Bill Pays Dividend''; two 
pieces by Tom Hamburger in the Wall Street Journal--``Auto Firms See 
Profit in Bankruptcy-Reform Bill Provision'' and ``Influence Market: 
Industries That Backed Bush Are Now Seeking Return on Investment,'' 
including in bankruptcy. Also, another piece by Robert Samuelson, ``Bad 
Timing on the Bankruptcy Bill.''
  Mr. President, I have an amendment that I think is a real test case. 
It simply says, if you charge over 100 percent interest on a loan, and 
the borrower goes bankrupt, you cannot make a claim on that loan or the 
fees from that loan. In other words, the borrower's slate is wiped 
clean of the usurious loan, and he gets a fresh start.
  This amendment is a commonsense solution to the problem I have talked 
about all afternoon. It allows the Senate to send a message to these 
loan sharks: If you charge an outrageous interest rate, if you profit 
from the misery and misfortune of others, if you stack the deck against 
the customer so that they become virtual slaves to your indebtedness, 
you will get no protection in bankruptcy court for your claims.
  In talking about these payday loans, I say to my colleagues, these 
are poor people, low- and moderate-income people. They don't have other 
sources of credit. They get charged on these loans as they roll over 
every several weeks up to 2,000 percent interest per year. Is it too 
much to say that if you charge over 100 percent per year, you are not 
going to get the protection in bankruptcy? Is it too much for the 
Senate to be on the side of consumers, to be on the side of poor 
people?
  This amendment is simple: Are we on the side of poor people? Do we 
provide some protection--for a single woman who is raising her family, 
for communities of color, senior citizens, working-income people who 
were put under by these interest rates--or are we on the side of some 
of the sleaziest loan sharks?
  I hope Senators will support this amendment. It certainly will make 
this bill less harsh. It doesn't change the overall equation. This is a 
great bill for the credit card industry, a great bill for the financial 
services industry. I congratulate them. What a lobbying force; how much 
money and how much lobbying and how much power. A whole lot of 
vulnerable people have been left out; a whole lot of middle-income 
families have been left out.
  I believe my colleagues will regret voting for this bill, but at the 
very minimum, they could vote for this amendment that goes after these 
loan sharks, that goes after these payday loans. It is such a 
deplorable practice. It is so outrageous, making such exorbitant profit 
off the misery of people. We ought to be on the side of vulnerable 
consumers. We ought to be on the side of low- and moderate-income 
families. We ought not be on the side of these loan sharks. This 
amendment should receive 100 votes.
  I say to my colleague from Illinois, for all the hours I have been 
out here, so far I have not heard one Senator come to the floor and 
debate this amendment. That is unbelievable to me.
  Mr. DURBIN. Will the Senator yield?
  Mr. WELLSTONE. I yield.
  Mr. DURBIN. What the Senator is saying is that no one has come to the 
floor defending the payday loans and the loan sharks?
  Mr. WELLSTONE. No one has come to the floor to defend the payday 
loans and the loan sharks. I have had this amendment on the floor for 3 
or 4 days.
  Mr. DURBIN. They have had ample opportunity. The Senator should get a 
unanimous vote.
  Mr. WELLSTONE. I say to my colleague from Illinois, I think this may 
be the first amendment I have introduced that is going to get 100 
votes.
  Mr. DURBIN. I look forward to it.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, lest there be a failure to talk about the 
other side, I might just do that.
  Although the amendment is described as only attacking ``payday 
loans,'' it imposes new and burdensome regulation on virtually any 
company that offers consumer loans, including automobile or truck 
loans, or that cashes personal checks and charges a fee. It represents 
an attempt to use Federal law to in effect abolish ``payday loans'', 
intruding into an area traditionally reserved to the States.
  Although lenders who provide ``payday loans'' are an easy target 
because the credit they offer is expensive, they in fact provide access 
to legitimate, short term credit for many poor families who otherwise 
would be forced to borrow from loan sharks to cover short term 
emergencies. Some borrowers, particularly poor borrowers, cannot 
qualify with conventional lenders. For that reason, some States permit 
``payday'' lenders to operate.
  This amendment would in effect drive payday lenders out of business.
  It also is vastly overbroad, imposing new, burdensome regulation on 
many legitimate businesses.
  The amendment amends the Bankruptcy Code to deny the claim of any 
creditor who charged more than a new, Federal maximum price ceiling for 
any type of automobile or consumer credit.
  The amendment also imposes a maximum Federal price limit of 100 
percent annual percentage rate on what any consumer creditor, 
automobile dealer, or check casher could charge in fees or interest for 
a loan or check cashing

[[Page 3645]]

service, possibly preempting State regulation setting a lower or higher 
price limit. Violations of the maximum Federal price limit would result 
in denial in bankruptcy proceedings of the claim of the creditor, auto 
dealer or check casher.
  This amendment strikes at any lender or merchant who charges flat 
fees permitted by State law in a lending transaction. For example, a 
$10 cash advance fee or a $15 Federal Express fee permitted by State 
law for quickly sending a check back to the borrower could exceed the 
limit if the credit was short term.
  This amendment intrudes into an area traditionally regulated by the 
States. Some States permit ``payday'' loans, but this regulation would 
initiate Federal regulation of the service.
  Oppose this unwise and overbroad attempt to federally regulate an 
area traditionally regulated by the States.
  This could hurt the very poor people who have to have these instant 
loans the Senator is trying to help. In fact, he hurts them.
  I yield the remainder of my time to the distinguished Senator from 
Texas.
  Mr. WELLSTONE. May I ask the Chair if I have any time left?
  The PRESIDING OFFICER. The Senator has 51 seconds remaining. The 
Senator from Texas has 2 minutes 30 seconds.
  Mr. GRAMM. Mr. President, this amendment is really a usury limit 
amendment. Our distinguished colleague from Minnesota simply objects to 
people lending at high interest rates.
  I am sure there are some people who believe that if contracts are 
entered into at terms they find objectionable, the terms should not be 
enforced. But that is not the way the American commercial code works. 
What this amendment would do, in essence, is say that if I borrowed 
$100 for a week and I paid a $2 service charge on that loan, if the 
borrower went bankrupt, I wouldn't have to pay the loan because the 
Senator from Minnesota has judged that interest rate to be too high.
  That is great when you are making $146,000 a year. That is great when 
every bank in your State would love to lend you money. But the plain 
truth is, there are a lot of Americans who need to borrow money, a lot 
of Americans who would like to borrow money for a week to get over a 
temporary credit problem they have. The terrible impact of this 
amendment is that it would destroy the ability of those people to use 
legitimate lenders and, in the process, would force them in many cases 
to borrow elsewhere and pay many times as much in interest.
  Not only is this Government simply imposing its will on the 
marketplace, but it also has real unintended consequences. Let me give 
an example. Let's say you have a debit card and you pay a fee in case 
you have an overcharge from your balance. If you write a check for 
$100, that fee is going to exceed the amount prohibited under the 
Wellstone amendment and, as a consequence, you wouldn't have to pay 
that charge if something happened to the company and it went into 
bankruptcy.
  Here is the problem: The kinds of interest rates that are being 
talked about sound high, and they are high when they are calculated on 
an annualized basis. But when you borrow for a week, the carrying 
charges and the finance charges, which aren't necessarily high for that 
period of time, by their very nature, produce a high annual rate.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. GRAMM. Mr. President, I ask unanimous consent for 1 additional 
minute.
  Mr. WELLSTONE. Mr. President, I would not object, although I would 
like to have, and ask unanimous consent for, 1 additional minute to 
respond.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRAMM. Let me give another example: If you took a cab in the 
District of Columbia and were driven to the airport, you would not 
consider the rate to be usurious. But if you took that same cab and 
were driven to Los Angeles, CA, and you were charged $50,000, you would 
likely consider that charge to be usurious. Do we have a law that tries 
to say that a rate going to California, which would be considered 
usurious, not be charged for traveling a much shorter local distance in 
the District of Columbia? The point is, when you are borrowing money 
for a week, you pay high annual interest rates.
  So, the net result of this amendment is to deny people access to 
credit. If the amendment were adopted, it is true that borrowers would 
no longer be paying high rates, but it is equally, and more 
significantly, true they wouldn't be getting any loans at all for which 
they were willing to pay. They will be driven into the black market, 
and they will pay a higher rate.
  The PRESIDING OFFICER. The Senator from Minnesota is recognized.
  Mr. WELLSTONE. Mr. President, no legitimate lender charges over 100 
percent interest on an annual basis. We have usury laws that deal with 
banks at the State level, and we should do so. But these payday lenders 
have carved out an exemption for themselves. These loan sharks have 
carved out an exemption for themselves.
  If Senators are concerned about poor people, we should be thinking 
about other ways they can have access to credit. We are not doing that 
at all. But we now have an opportunity to make it clear that we are not 
going to let these loan sharks continue to feed off of the misery of 
poor people. We are not going to let them engage in this kind of 
exploitation.
  To my colleagues who say, oh, no, 100 percent, or 300 percent, or 
2,000 percent interest rates on an annual basis are just what poor 
people need, so please don't have an amendment, Senator Wellstone, that 
will hurt poor people; they need to be able to pay over 100 percent per 
year--your arguments are absurd, as much as I like you. They are 
absurd.
  Frankly, you can't get out of this vote. You are either for 
vulnerable citizens and families and you are against this kind of loan 
shark practices or you are on the side of these loan sharks. Senators, 
step up to the plate and vote.
  I yield the floor.
  Mr. HATCH. Mr. President, I move to table the amendment of the 
Senator from Minnesota, and I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                            Amendment No. 93

  Mr. FEINGOLD. Mr. President, I rise to support Mr. Durbin's amendment 
that is a complete substitute for the pending bankruptcy reform bill. 
This amendment is essentially the bill that passed the Senate in 1998 
by a vote of 97-1. This near unanimous vote in favor of a bill shows 
that it is possible to have bankruptcy reform that the whole Senate can 
support if it is balanced and fair.
  Unfortunately, I have said before, S. 420 is not balanced and fair. I 
have outlined in detail my concerns with this bill. Mr. Durbin's 
amendment goes a long way to addressing those concerns and I will vote 
for it if we are permitted to vote on it.
  One of the most significant improvements that the Durbin amendment 
accomplishes is that it contains much stronger credit card disclosure 
requirements.
  Literally billions of credit card solicitations flood consumers' 
mailboxes each year. Not millions but billions.
  Even though the number of bankruptcies is now on the way down, most 
experts agree that the rise in bankruptcy filings that occurred in the 
past decade was due in significant part to the irresponsible extending 
of credit by credit card companies and banks to people who have already 
shown that they cannot handle additional debt.
  Just to give a single tangible example of the blizzard of 
solicitations that credit card issuers are now sending out, one member 
of my staff has collected solicitations he received by mail since this 
bill was marked up in the last Congress. In the last 20 months, he has 
received 95 mail offers for a new credit card. Now I am sure my staffer 
is a very creditworthy individual, but 95 offers for a new credit card? 
I am sure that my colleagues have received at

[[Page 3646]]

least as many solicitations, even if they did not count them all up. 
And of course, these direct mail offers don't include the constant 
invitations for credit cards that people see every day on TV and on the 
Internet.
  This is an industry whose sales pitches are out of control. The 
credit card companies are making bad decisions every day. People 
receive new cards with thousands of dollars of new credit when they 
have maxed out on 2, 5, or even 10 other cards.
  And now the credit card companies have come before Congress asking 
for our help. And boy, are we about to give it to them. This bill is a 
bailout for the credit card industry. It is going to make it easier for 
credit card companies to collect more on the bad decisions they have 
made, the credit they have extended to people who are demonstrably poor 
credit risks. And make no mistake, giving the credit card companies 
more power will work to the detriment of women trying to collect 
alimony and child support from ex-husbands who have filed for 
bankruptcy.
  Last December, the Wisconsin State Journal, a very middle-of-the-road 
paper in my home State, summarized well my concern about the extent to 
which this bill gives the credit card industry what it wants. The 
Journal wrote:

       When the credit card industry came to Congress to ask for 
     help in collecting debts from deadbeats, Congress should have 
     said: It's not government's job to bail you out. Why don't 
     you tighten up your own lending practices? Instead, Congress 
     let the industry turn a bankruptcy reform bill into a debt 
     collection assistance plan.

  The editorial continues:

       The House and Senate had before them 172 recommendations 
     from the National Bankruptcy Reform Commission, which was led 
     by Madison attorney Brady Williamson. The commission had 
     stressed that bankruptcy law must remain balanced: It must 
     work for creditors and debtors.
       But the congressmen also had before them lobbyists for the 
     credit card industry and similar lenders. Quickly, bankruptcy 
     reform legislation became a campaign fund-raising bonanza for 
     the politicians, with the lending industry ``investing'' $20 
     million in contributions. Just as quickly, bankruptcy reform 
     turned into the credit card industry's bill.

  My colleagues are well aware of my concern about the influence of 
campaign money on politics and policy. As I have said a number of 
times, the bankruptcy bill is a poster child for the need for campaign 
finance reform. You only have to look at what the credit card industry 
gets in this bill, and just as importantly, the disclosure that 
consumers do not get, to understand that.
  A full discussion of this amendment, or the larger bankruptcy issue, 
is impossible without a Calling of the Bankroll. Money and influence 
are at the very core of this debate.
  I would like to call my colleagues' attention to an article from the 
February 26th issue of Business Week magazine. It's called ``Tougher 
Bankruptcy Laws--Compliments of MBNA?'' The article points out the 
extraordinary largesse of this one credit card company, which is, of 
course, a significant leader of the coalition supporting this bill.
  The contributions of MBNA were also noted in an article in the New 
York Times entitled, ``Hard Lobbying on Debtor Bill Pays Dividend.''
  Most of the $1.2 million in soft money that MBNA gave to the parties 
in the last cycle was given in the second half of 2000, when a ``shadow 
conference'' determined what the final bankruptcy bill would look like, 
and the bill was brought back to the House and the Senate in an 
extraordinary procedural maneuver. In particular, MBNA gave $100,000 in 
soft money to the National Republican Senatorial Committee on October 
12, 2000, the very same day that the House gave final approval to the 
bill. MBNA has a habit of making well-timed contributions. On the very 
day that the House passed a bankruptcy conference report in 1998 and 
sent it to the Senate, MBNA gave a $200,000 soft money contribution to 
the NRSC.
  To give my colleagues and the public an idea of just how generous 
MBNA has been, the corporation's Chairman & CEO, Alfred J. Lerner, and 
his wife, Norma, each made contributions of a quarter of a million 
dollars to the Republican National Committee in the last cycle.
  And the generosity didn't stop there. According to an article in the 
Wall Street Journal from March 6th, MBNA President Charles M. Cawley is 
also an active political donor and fundraiser who gave $100,000 to the 
Bush-Cheney Inaugural Committee.
  Of course, MBNA is not the only wealthy interest fighting against 
this bill, on the contrary, they have plenty of company. According to 
the Center for Responsive Politics, the nine members of the National 
Consumer Bankruptcy Coalition contributed more than $5 million in soft 
money, PAC money and individual contributions during the 2000 election 
cycle. The Coalition's members include Visa USA, Mastercard 
International and several financial industry trade groups, including 
the American Bankers Association and the American Financial Services 
Association.
  This is the fourth time I have Called the Bankroll on the bankruptcy 
issue from this floor. You might wonder how I manage to come up with 
new information, bankroll after bankroll after bankroll. Well, the 
answer is simple: the industry keeps giving more and more money.
  Huge sums, like quarter million dollar contributions, and six figure 
donations that just happen to be delivered on key days when legislation 
is up for a vote. This industry is not subtle. They want this 
legislation to become law, and they aren't shy about using the campaign 
finance system to get their way.
  That is the context in which we consider this amendment. And that is 
all the more reason why sensible protections like that proposed in this 
amendment need to be adopted.
  I urge my colleagues to support the Durbin amendment.
  I ask unanimous consent that the articles from Business Week and The 
New York Times be printed in the Record.
  There being no objection, the articles were ordered to be printed in 
the Record, as follows:

                  [From Business Week, Feb. 26, 2001]

             Tougher Bankruptcy Laws--Compliments of MBNA?

                      (By Christopher H. Schmitt)

       Last December, as Congress struggled to wrap up a lame-duck 
     session, it sent President Clinton an overhaul of bankruptcy 
     laws. The bill, the most sweeping change in bankruptcy policy 
     in two decades, had handily passed both houses. But Clinton, 
     complaining that it was unfair to those who fall on hard 
     times, let it die. That was a big disappointment to credit-
     card issuer MBNA Corp., which has spent several years 
     lobbying for a bankruptcy rewrite and stands to be the 
     biggest beneficiary of an overhaul.
       Now, MBNA is about to hit pay dirt. New bankruptcy 
     legislation is on a fast track. Judiciary panels in the House 
     and Senate have held perfunctory hearings, and a bill could 
     be on the House and Senate floors as early as late February. 
     A White House spokesman has indicated that George W. Bush 
     will sign it.
       The bill--a carbon copy of last year's version--is aimed at 
     stopping consumers from dissolving debts they can afford to 
     repay. It would establish a ``needs-based'' formula that 
     would determine whether debtors can pay off part of their 
     debt under court supervision. Those earning at or above the 
     median for their state would have to make good on at least 
     part of their obligations. LARGESSE. While this would help 
     all lenders, it especially benefits MBNA, the world's largest 
     credit-card issuer. The credit that MBNA and its fellow 
     plastic-issuers extend is typically unsecured, so they have 
     less recourse than other creditors when a customer can't pay. 
     Morgan Stanley Dean Witter analyst Kenneth A. Posner 
     estimates that the overhaul could boost credit-card issuers' 
     earnings by 5% this year. For MBNA, that could mean some $75 
     million more in profit, based on third-quarter earnings.
       With the kind of payoff, the company has been pushing hard 
     for the bill--and the election of a President who will sign 
     it. In Campaign 2000, MBNA employees contributed $237,675 to 
     Bush, making them the candidate's single biggest source of 
     cash, according to the Center for Responsive Politics, a 
     campaign-finance think tank in Washington. On the soft-money 
     side, MBNA chipped in nearly $600,000, with about two-thirds 
     going to the GOP. (Most of the rest went to a Democratic 
     Party committee.) On top of that, MBNA Chairman and CEO 
     Alfred Lerner and his wife, Norma, each kicked in $250,00 to 
     the Republicans. Charles M. Cawley, CEO of MBNA's bank unit 
     and a friend of Bush Sr., organized fund-raisers and gave 
     $18,660 to Bush and the GOP.

[[Page 3647]]

       Much of the money flowed in the second half of last year, 
     when the bankruptcy bill was moving on Capitol Hill. One 
     example: On the same day the House gave final approval, MBNA 
     ponied up $100,000 for the Republican Party. ``This is just a 
     real good illustration of the way things work in Washington: 
     Money is given, money is given strategically, [and] money is 
     given by industries for a particular purpose,`` says Celia 
     Viggo Wexler, author of a Common Cause report on consumer-
     credit companies' political giving. Adds Edmund Mierzwinski, 
     consumer director for the U.S. Public Interest Research 
     Group: MBNA's largesse is ``clearly money well spent.'' 
     Lerner, Cawley, and an MBNA spokesman did not return calls 
     seeking comment.
       Consumer groups say they'll continue to fight the bill, 
     which they contend is especially ill-advised in the slowing 
     economy. After falling 12% from a high of 1.44 million in 
     1998, bankruptcy filings are ticking up again. One early 
     report shows cases in January rose 15% over a year ago. A 
     handful of Democrats will seek to soften the bill's impact on 
     indebted consumers, but quick approval seems guaranteed. 
     ``This legislation is on a downward ski slope, never to be 
     stopped.'' said Representative Sheila Jackson Lee (D-Tex.) at 
     a recent hearing. And smoothing the way is MBNA.
                                  ____


                [From the New York Times, Mar. 13, 2001]

               Hard Lobbying on Debtor Bill Pays Dividend

                           (By Philip Shenon)

       Washington, Mar. 12.--A lobbying campaign led by credit 
     card companies and banks that gave millions of dollars in 
     political donations to members of Congress and contributed 
     generously to President Bush's 2000 campaign is close to its 
     long-sought goal of overwhelming the nation's bankruptcy 
     system.
       Legislation that would make it harder for people to wipe 
     out their debts could be passed by the Senate as early as 
     this week. The bill has already been approved by the House, 
     and Mr. Bush has pledged to sign it.
       Sponsors of the bill acknowledge that lawyers and lobbyists 
     for the banks and credit card companies were involved in 
     drafting it. The bill gives those industries most of what 
     they have wanted since they began lobbying in earnest in the 
     late 1990's, when the number of personal bankruptcies rose to 
     record levels.
       In his final weeks in office, President Bill Clinton vetoed 
     an identical bill, describing it as too tough on debtors. But 
     with the election of Mr. Bush and other candidates who 
     received their financial support, the banks and credit card 
     industries saw an opportunity to quickly resurrect the 
     measure.
       In recent weeks, their lawyers and lobbyists have jammed 
     Congressional hearing rooms to overflowing as the bill was 
     redebated and reapproved. During breaks, there was a common, 
     almost comical pattern. The pinstriped lobbyists ran into the 
     hallway, grabbed tiny cell phones from their pockets or 
     briefcases and reported back to their clients, almost always 
     with the news they wanted to hear.
       ``Where money goes, sometimes you see results,'' 
     acknowledged Representative George W. Gekas, a Pennsylvania 
     Republican who was a sponsor of the bill in the House. But 
     Mr. Gekas said that political contributions did not explain 
     why most members of Congress and Mr. Bush appeared ready to 
     overhaul the bankruptcy system.
       ``People are gaming this system,'' Mr. Gekas said, 
     describing the bill as an effort to end abuses by people who 
     are declaring bankruptcy to wipe out their debts even though 
     they have the money to pay them. ``We need bankruptcy 
     reform.''
       Among the biggest beneficiaries of the measure would be 
     MBNA Corporation of Delaware, which describes itself as the 
     world's biggest independent credit card company. Ranked by 
     employee donations, MBNA was the largest corporate 
     contributor to the Bush campaign, according to a study by the 
     Center for Responsive Politics, an election research group.
       MBNA's employees and their families contributed about 
     $240,000 to Mr. Bush, and the chairman of the company's bank 
     unit, Charles M. Cawley, was a significant fund-raiser for 
     Mr. Bush and gave a $1,000 a-plate dinner in his honor, the 
     center said. After Mr. Bush's election, MBNA pledged $100,000 
     to help pay for inaugural festivities.
       MBNA was obviously less enthusiastic about the candidacy of 
     former Vice President Al Gore, Mr. Bush's Democratic rival; 
     according to the center, only three of the company's 
     employees gave money to the Gore campaign, and their 
     donations totaled $1,500.
       The center found that of MBNA's overall political 
     contributions of $3.5 million in the last election, 86 
     percent went to Republicans, 14 percent to Democrats. The 
     company, which did not return phone calls for comments, made 
     large donations to the Senate campaign committees of both 
     political parties--$310,000 to the Republicans, $200,000 to 
     the Democrats.
       MBNA's donations were part of a larger trend within the 
     finance and credit card industries, which have widely 
     expanded their contributions to federal candidates as they 
     stepped up their lobbying efforts for a bankruptcy overhaul.
       According to the Center for Responsive Politics, the 
     industries' political donations more than quadrupled over the 
     last eight years, rising from $1.9 million in 1992 to $9.2 
     million last year, two-thirds of it to Republicans.
       Kenneth A. Posner, an analyst for Morgan Stanley Dean 
     Witter, said that the bankruptcy bill would mean billions of 
     dollars in additional profits to creditors, and that it would 
     raise the profits of credit card companies by as much as 5 
     percent next year. In the case of MBNA, that would mean 
     nearly $75 million in extra profits in 2002, based on its 
     recent financial performance.
       The bill's most important provision would bar many people 
     from getting a fresh start from credit card bills and other 
     forms of debt when they enter bankruptcy. Depending on their 
     income, it would bar them from filing under Chapter 7 of the 
     bankruptcy code, which forgives most debts.
       Under the legislation, they would have to file under 
     Chapter 13, which would require repayment, even if that meant 
     balancing overdue credit card bills with alimony and child-
     support payments.
       Consumer groups describe the bill as a gift to credit card 
     companies and banks in exchange for their political largess, 
     and they complain that the bill does nothing to stop abuses 
     by creditors who flood the mail with solicitations for high-
     interest credit cards and loans, which in turn help drive 
     many vulnerable people into bankruptcy.
       ``This bill is the credit card industry's wish list,'' said 
     Elizabeth Warren, a Harvard law professor who is a bankruptcy 
     specialist. ``They've hired every lobbying firm in 
     Washington. They've decided that it's time to lock the doors 
     to the bankruptcy courthouse.''
       The bill's passage would be evidence of the heightened 
     power of corporate lobbyists in Washington in the aftermath 
     of last year's elections, which left the White House and both 
     houses of Congress in the hands of business-friendly 
     Republicans.
       Last week, corporate lobbyists had another important 
     victory when both the Senate and the House voted to overturn 
     regulations imposed during the Clinton administration to 
     protect workers from repetitive-stress injuries.
       Credit card companies and banks would not be the only 
     interests served by the bankruptcy bill. Wealthy American 
     investors in Lloyd's of London, the insurance concern, have 
     managed through their lobbyists to insert a provision in the 
     bill that would block Lloyd's from collecting millions of 
     dollars that the company says it is owed by the Americans.
       Lloyd's has hired its own powerful lobbyist, Bob Dole, to 
     help plead its case on Capitol Hill. Last week, the chief 
     executive of Lloyd's was in Washington to plot strategy.
       The issue involves liabilities incurred by Lloyd's in the 
     1980's and 1990's when it was forced to pay off claims on 
     several disasters, like the Exxon Valdez oil spill. Investors 
     in Lloyd's are expected to share both its profits and its 
     losses, but the American have refused to settle the debts, 
     claiming they were misled by Lloyd's.
       As he watched consumer-protection amendments to the 
     bankruptcy bill fail by lopsided margins last week, Senator 
     Patrick J. Leahy of Vermont, the ranking Democrat on the 
     Judiciary Committee and a leading critic of the bill, said 
     that colleagues had told him privately that they were 
     ``committed to the banks and credit card companies--and they 
     are not going to change.
       ``Some of them do this because they think it's the right 
     thing to do,'' Mr. Leahy said.
       But he said other senators were voting for the bill because 
     they know that the banks and credit card companies ``are a 
     very good source'' of political contributions. ``I always 
     assume senators are doing things for the purest of motives,'' 
     he added, his voice thick with sarcasm. ``But I have never 
     had credit card companies show up at my fund-raisers, and I 
     don't think they ever will.''
       Mr. Gekas said the implication that money was buying 
     support for the bankruptcy bill was insulting, and that the 
     bill did most consumers a favor by ending practices by some 
     debtors that had forced up interest rates for everybody else. 
     ``Bankruptcies are costly to all of us who don't go 
     bankrupt,'' Mr. Gekas said.
       In the late 1990's, banks, credit card industries and 
     others with an interest in overhauling the bankruptcy system 
     formed a lobbying group, the National Consumer Bankruptcy 
     Coalition, for the purpose of pushing a bankruptcy-overhaul 
     bill through Congress.
       They said they needed to act to deal with what was then a 
     record number of personal bankruptcy filings. According to 
     court records, the number of personal bankruptcies hit nearly 
     1.4 million in 1998, a record, up from 718,000 in 1990. The 
     number fell to just under 1.3 million last year, although it 
     is expected to rise again if the economy continues to sour.
       The coalition's founders included Visa and Mastercard, as 
     well as the American Financial Services Association, which 
     represents the credit card industry, and the American Bankers 
     Association.
       The Center for Responsive Politics found that the 
     coalition's members contributed

[[Page 3648]]

     more than $5 million to federal parties and candidates during 
     the 1999-2000 election campaign, a 40 percent increase over 
     the last presidential election.

  The PRESIDING OFFICER. The question is on agreeing to the motion to 
table the amendment of the Senator from Illinois, Mr. Durbin.
  Mr. LEAHY. I ask unanimous consent that I be able to continue for 1 
minute, with the same amount of time for the Senator from Utah, before 
we go to a vote.


  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. Mr. President, I wish to take the time to simply ask the 
Senator from Utah where we stand on the managers' package? Are we 
getting close to that time? We have a number of items being cleared or 
have been cleared. I would like to get that taken care of. I would like 
to be able to present the managers' package prior to the cloture vote.
  Mr. HATCH. We are working on that, but we don't have it put together 
yet. I don't know if we can do that before the cloture vote, but we 
will continue to work on it.
  Mr. LEAHY. Mr. President, I further ask of the Senator from Utah, if 
they are unable to complete the ones we have agreed on--the paperwork--
it would fall, if cloture was voted, on the basis of germaneness.
  The PRESIDING OFFICER. The time has expired.
  Mr. HATCH. We are going to try to work with the Senator. It may take 
a unanimous consent postcloture.
  Mr. LEAHY. Mr. President, I ask unanimous consent that when the 
managers' package is brought forward, and it is agreed on by the 
Senator from Utah and the Senator from Vermont, the items in it be 
considered germane.
  Mr. HATCH. I cannot agree to that at this time, but I will certainly 
run that by the appropriate people.
  The PRESIDING OFFICER. The question before the Senate is on agreeing 
to the motion to table the amendment of the Senator from Illinois. The 
yeas and nays have been ordered. The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  The result was announced--yeas 64, nays 35, as follows:

                      [Rollcall Vote No. 27 Leg.]

                                YEAS--64

     Allard
     Allen
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Carnahan
     Carper
     Chafee
     Cleland
     Cochran
     Collins
     Craig
     Crapo
     DeWine
     Domenici
     Ensign
     Enzi
     Frist
     Graham
     Gramm
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Jeffords
     Johnson
     Kyl
     Lieberman
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stabenow
     Stevens
     Thomas
     Thompson
     Thurmond
     Torricelli
     Voinovich
     Warner

                                NAYS--35

     Akaka
     Boxer
     Byrd
     Cantwell
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Harkin
     Hollings
     Inouye
     Kennedy
     Kerry
     Kohl
     Landrieu
     Leahy
     Levin
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Wellstone
     Wyden

                        ANSWERED ``PRESENT''--1

       
     Fitzgerald
       
  The motion was agreed to.
  Mr. HATCH. Mr. President, I move to reconsider the vote and I move to 
lay that motion on the table.
  The motion to lay on the table was agreed to.


                     Amendment No. 36, As Modified

  Mr. GRASSLEY. Mr. President, I oppose the amendment of Senator 
Wellstone dealing with payday loans. For people who aren't familiar 
with this kind of loan, payday loans occur when a borrower gives a 
personal check to someone else, and that person gives the borrower cash 
in an amount less than the amount of the personal check. The check 
isn't cashed if the borrower redeems the check for its full value 
within 2 weeks.
  At the onset, I would like to point out the fact that payday loans 
are completely legal transactions in many states. If a financial 
transaction is perfectly legal under state law, I don't think that it 
is wise policy to use the bankruptcy code to try and undo that legal 
state transaction.
  Using the Bankruptcy Code for this purpose leads to perverse results 
because the only people who will receive any benefit or relief will be 
those who file for bankruptcy. The amendment would deny payday lenders 
the right to sit at the bankruptcy bargaining table. So other people 
who use payday loans who never file for bankruptcy will not benefit 
from this amendment. These people who have taken out loans but don't 
take the easy way out in bankruptcy court will still have to pay back 
their loan. Therefore, you have the perverse result of people who do 
not have the money to file for bankruptcy who will have to pay the loan 
as agreed. Even if you share Senator Wellstone's distaste for payday 
loans, this amendment won't benefit the poorest of the poor because 
most of them do not seek bankruptcy relief.
  I also think that the Wellstone amendment would have the effect of 
making it harder for the poor and those with bad credit histories to 
gain access to cash--the very people that Senator Wellstone is 
concerned about. People who use payday loans simply cannot get loans 
through traditional sources because they are too risky, so a payday 
loan may be the only way they can get quick cash to pay for family 
emergencies or essential home and auto repairs.
  I know that the intentions of my friend from Minnesota are honorable, 
but the effect of this amendment would be to make it harder for poor 
people to get the help they need when they need it. So I urge my 
colleagues to reject the Wellstone payday amendment.
  The PRESIDING OFFICER (Mr. Brownback). The question is on agreeing to 
the motion to table amendment No. 36, as modified. The yeas and nays 
have been ordered. The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  The result was announced--yeas 58, nays 41, as follows:

                      [Rollcall Vote No. 28 Leg.]

                                YEAS--58

     Allard
     Allen
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chafee
     Cochran
     Collins
     Craig
     Crapo
     DeWine
     Domenici
     Ensign
     Enzi
     Frist
     Gramm
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Jeffords
     Johnson
     Kyl
     Landrieu
     Lincoln
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Reid
     Roberts
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stabenow
     Stevens
     Thomas
     Thompson
     Thurmond
     Voinovich
     Warner

                                NAYS--41

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Carnahan
     Cleland
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham
     Harkin
     Hollings
     Inouye
     Kennedy
     Kerry
     Kohl
     Leahy
     Levin
     Lieberman
     Mikulski
     Murray
     Nelson (FL)
     Reed
     Rockefeller
     Sarbanes
     Schumer
     Torricelli
     Wellstone
     Wyden

                        ANSWERED ``PRESENT''--1

       
     Fitzgerald
       
  The motion to lay on the table was agreed to.


                             Change of Vote

  Mr. BIDEN. Parliamentary inquiry, Mr. President.
  The PRESIDING OFFICER. The Senator from Delaware.
  Mr. BIDEN. Would it be appropriate at this time to be able to ask 
unanimous consent to change my vote on the last tabling motion? It will 
not affect the outcome of the vote. I intended to vote with Senator 
Wellstone. I did not realize it was a tabling motion. I voted ``aye.'' 
I would like to change my

[[Page 3649]]

vote to ``no.'' I ask unanimous consent to do that.
  The PRESIDING OFFICER. Is there objection?
  Mr. WELLSTONE. Mr. President, I will not object.
  Mr. BIDEN. I thank my friend.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The foregoing tally has been changed to reflect the above order.)
  Mr. HATCH. Mr. President, I move to reconsider the vote and move to 
lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
Minnesota is recognized for up to 5 minutes.
  The Senator from Minnesota.
  Mr. WELLSTONE. Thank you, Mr. President.
  First of all, I think this vote on the--
  The PRESIDING OFFICER. The Senator will suspend for a moment.
  We will have order in the body.
  The Senator from Minnesota is recognized.
  Mr. WELLSTONE. Mr. President, we really do need order.
  The PRESIDING OFFICER. We will please have order in the body. Please 
take your conversations off the floor. We cannot proceed until we have 
order.
  Mr. WELLSTONE. I thank the Chair and thank my colleagues for their 
courtesy.
  Mr. President, we just had a vote that dealt with payday loans, 
whether or not we were going to provide some protections to the most 
vulnerable consumers. That amendment failed.
  My colleague, Senator Durbin, and other colleagues, have come out on 
the floor with amendments that have gone after predatory practices. 
They have said: Look, let's give consumers some protection. Those 
amendments--or most of those amendments--have failed.
  I had an amendment earlier which said, look, if you want to go after 
those people who are gaming this system, fine, but for goodness' sake, 
for the 50 percent of the people who are going under because of medical 
bills and who find themselves in these difficult circumstances, carve 
out an exemption. Do not make it so difficult for them to file for 
chapter 7. Do not make it so difficult for them to go through this 
procedure, this procedure, and this procedure. Do not put so many 
hurdles in their way.
  Bankruptcy is a safety net not just for low-income people but for 
middle-income people.
  There was a front page story the other day in the New York Times. The 
headline was: ``Lobbying On Debtor Bill Pays Dividend.''
  I do not want to get myself in trouble with people in whom I believe. 
I do not make a one-to-one correlation such as, for example, the 
Senator from Utah and the Senator from Iowa; they have a different 
viewpoint. That is why they have argued for this bill, period. Let's 
just make that argument and stop there.
  But I will tell you, at an institutional level, there is a serious 
problem with this bill. And it is this: When it comes to the financial 
services industry, the credit card industry, broadly defined, big 
givers, heavy hitters, a huge and powerful lobbying coalition, they 
have way too much access, and they have way too much say.
  It is an institutional problem because the people filing for chapter 
7, trying to rebuild their lives because of a major medical bill or 
because they have lost their job on the Iron Range or because there has 
been a divorce, they do not have the same clout. They do not have the 
same economic resources.
  Quite frankly, I think this bill is too harsh, it is not balanced, it 
is not just, it is not fair, and there are a whole lot of families in 
this country who are going to pay the price.
  I call on my colleagues to vote against cloture. I know the vast 
majority of Senators will not do so, but I will tell you, I do not 
believe by voting for cloture and then going forward and passing this 
bankruptcy bill we have done the right thing. I think this is good for 
the credit card industry. It is good for the financial services 
industry. But I think we have left out consumers.
  We have left out a lot of low- and moderate- and middle-income 
people. We have left out a lot of women who are single and the heads of 
their households. We have left out a whole lot of people of color and a 
whole lot of people who are disproportionately among the ranks of 
working-income and low-income people.
  So I say to Senators, I hope you will vote against cloture. This bill 
does not deserve to go forward. This bill represents the power of the 
financial services industry that has marched on Washington every single 
day for the last 3 years. And it leaves out ordinary citizens in a very 
profound and very harsh way. Senators, please vote against cloture.
  The PRESIDING OFFICER. Under the previous order, the majority leader 
or his designee is recognized for up to 5 minutes.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I hate to disagree with my friend and 
colleague from Minnesota, but he could not be more wrong. This bill 
actually will do an awful lot of good for people in our society. I will 
not go into all the details on that. All I have to say is that a vote 
at this stage against cloture is a vote against bankruptcy reform.
  The bill we are voting on is the same bill that got 70 votes last 
year, plus it includes the Schumer-Hatch violence amendment among a 
number of other Democratic Party amendments. Let me remind my 
colleagues, and everyone else who wants bankruptcy reform, that many of 
those who voted against this bill that passed 70-28 last December said 
if the Schumer violence language had been included, they would have 
voted for it. Well, it is included. We have worked that language out. 
It is a shame we have been forced to file cloture after all of the 
accommodations we have made. I would have preferred not to file 
cloture, but I believed that was the way we needed to proceed.
  We have been very fair on this bill. I hope our colleagues will 
realize this is a very important bill. It makes very important changes 
that are needed in the bankruptcy laws of this country. We have 
accommodated both sides in virtually every way we possibly could. I 
hope everybody will vote for cloture, and let's get this bill passed 
and get it enacted into law.
  Is there any time remaining?
  The PRESIDING OFFICER. The Senator has 3 and a half minutes 
remaining.
  Mr. HATCH. Is that all the time that is remaining?
  The PRESIDING OFFICER. The Senator from Minnesota has 28 seconds 
remaining.
  Mr. HATCH. We are prepared to yield back.


                             cloture motion

  The PRESIDING OFFICER. All time is yielded back. Under the previous 
order, the clerk will report the motion to invoke cloture.
  The assistant legislative clerk read as follows:

                             Cloture Motion

       We the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     do hereby move to bring to a close debate on S. 420, an 
     original bill to amend title 11, United States Code, and for 
     other purposes:
         Trent Lott, Robert F. Bennett, Chuck Grassley, Orrin G. 
           Hatch, Susan Collins, Pat Roberts, Lincoln Chafee, 
           Strom Thurmond, Frank H. Murkowski, Mitch McConnell, 
           Rick Santorum, Jeff Sessions, Richard G. Lugar, Gordon 
           Smith, George Voinovich, and Bill Frist.

  The PRESIDING OFFICER. By unanimous consent, the mandatory quorum 
call has been waived.
  The question is, Is it the sense of the Senate that debate on S. 420, 
a bill to amend title 11, United States Code, and for other purposes, 
shall be brought to a close?
  The yeas and nays are required under the rule.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. FITZGERALD (when his name was called). Present.
  The yeas and nays resulted--yeas 80, nays 19, as follows:

[[Page 3650]]



                      [Rollcall Vote No. 29 Leg.]

                                YEAS--80

     Akaka
     Allard
     Allen
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Byrd
     Campbell
     Cantwell
     Carnahan
     Carper
     Chafee
     Cleland
     Cochran
     Collins
     Conrad
     Craig
     Crapo
     Daschle
     DeWine
     Domenici
     Dorgan
     Edwards
     Ensign
     Enzi
     Feinstein
     Frist
     Graham
     Gramm
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hollings
     Hutchinson
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnson
     Kohl
     Kyl
     Lieberman
     Lincoln
     Lott
     Lugar
     McCain
     McConnell
     Mikulski
     Miller
     Murkowski
     Murray
     Nelson (NE)
     Nickles
     Reid
     Roberts
     Rockefeller
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stabenow
     Stevens
     Thomas
     Thompson
     Thurmond
     Torricelli
     Voinovich
     Warner

                                NAYS--19

     Boxer
     Clinton
     Corzine
     Dayton
     Dodd
     Durbin
     Feingold
     Harkin
     Kennedy
     Kerry
     Landrieu
     Leahy
     Levin
     Nelson (FL)
     Reed
     Sarbanes
     Schumer
     Wellstone
     Wyden

                        ANSWERED ``PRESENT''--1

       
     Fitzgerald
       
  The PRESIDING OFFICER. On this vote, the yeas are 80, the nays are 
19, and one voted ``present.'' Three-fifths of the Senators duly chosen 
and sworn having voted in the affirmative, the motion is agreed to.
  Mr. HATCH. Mr. President, I move to reconsider the vote, and I move 
to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. HATCH. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.


                            Amendment No. 19

  Mr. LEAHY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Allard). Without objection, it is so 
ordered.
  Mr. LEAHY. Mr. President, what is the pending business?
  The PRESIDING OFFICER. Amendment No. 19 is pending.
  Mr. LEAHY. Mr. President, have the yeas and nays been ordered on 
amendment No. 19?
  The PRESIDING OFFICER. No.
  Mr. LEAHY. Is amendment No. 19 germane?
  The PRESIDING OFFICER. It appears to be.
  Mr. LEAHY. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is not a sufficient second.
  Mr. GRASSLEY. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. LEAHY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. Mr. President, I know the Senator from Alaska wishes to 
speak on his time. I am going to yield to him in just a second.
  Is my understanding from the Senator from Iowa correct that it is now 
in order--I realize we are not about to vote right now--to get the yeas 
and nays on this amendment?
  Mr. GRASSLEY. Sure.
  Mr. LEAHY. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The Senator from Alaska is recognized.
  Mr. STEVENS. Mr. President, I seek time under the time allocated to 
me under the current procedure in the Senate.
  The PRESIDING OFFICER. The Senator is recognized.

                          ____________________