[Congressional Record (Bound Edition), Volume 161 (2015), Part 8]
[Senate]
[Pages 11210-11211]
[From the U.S. Government Publishing Office, www.gpo.gov]




                                S. 1722

  Mr. ROUNDS. Mr. President, I rise to speak concerning the Dodd-Frank 
Act, which mandates the creation of 398 new rules. These rules are 
still in the process of being implemented, but already we have seen 
capital moving from productive uses to inefficient and unproductive 
uses as a result of this law. The end result is that every dollar going 
to comply with these rules is a dollar that can't be productively 
invested in our economy by providing loans or mortgages to customers or 
purchasing machines or, for that matter, hiring new employees. For 
example, at a recent Senate banking committee hearing, the comptroller 
for Regions Bank testified to us that the bank now employs more 
compliance employees than actual loan officers. This is not only bad 
for Regions Bank, it is harmful for our entire economy.
  Unfortunately, we see examples of overregulation stemming from 
Washington way too often. Another example

[[Page 11211]]

of an unnecessary and redundant rule that costs businesses capital is 
the so-called pay ratio rule buried in section 953 of Dodd-Frank, and 
today I come to the Senate floor introducing legislation to repeal it, 
S. 1722. Pay ratio requires the Securities and Exchange Commission to 
promulgate a rule requiring companies to calculate the median salary of 
all their employees and then divide their CEO's pay by that number.
  According to one prominent organization in support of this rule, the 
purpose of it is to ``shame companies into lowering CEO pay.'' Forcing 
companies to move money from productive uses toward re-creating 
information that is already available so they can be shamed is a poor 
use of financial resources. In addition, it is also redundant. CEO pay 
is already public. If anyone is interested in finding the salary of a 
CEO of a public company, that information is easily available thanks to 
already existing disclosures. Also, both the Bureau of Labor Statistics 
and private economists already track the average salary for a wide 
variety of jobs. If we know the salary of a company's CEO and we know 
what their business does, we can already calculate a company's pay 
ratio. In fact, labor unions and private Web sites are already making 
these calculations.
  Unfortunately, the result of the pay ratio rule is more than just an 
academic exercise; according to the SEC, companies will have to spend 
$73 million per year to comply with this rule. And the U.S. Chamber of 
Commerce estimates the cost will be higher--as much as $700 million per 
year or more. If we take those two numbers and split the difference, if 
we add them up and divide them, we get $386 million per year as an 
average estimate just to comply with this one single rule.
  Taking a look at this rule, let's use our own pay ratio test. In 
2014, the Bureau of Labor Statistics calculated that the annual mean 
wage was $47,230. If we divide $386 million, which is the cost of 
complying with the pay ratio rule, by $47,230, which is the mean annual 
wage for workers, we get the number 8,172. This means that on average 
we could pay 8,172 people their full salary for the amount of money it 
takes to comply with the pay ratio rule. Remember, this is only one of 
398 such rules found within Dodd-Frank, a number of which have not even 
been implemented yet.
  The money they would use to do this has to come from somewhere to pay 
for the new compliance systems required to follow this rule, taking 
away much needed capital from businesses that could otherwise invest 
money growing their business and creating job opportunities. It is a 
waste of time, effort, and money.
  The legislation I introduced yesterday simply strikes this rule in 
Dodd-Frank. It does nothing to change any other part of the law. 
Repealing the pay ratio rule would allow companies to find more 
productive uses for their time and money so they can invest in the 
future and create job opportunities.
  I am committed to relieving Americans from this and other unnecessary 
and burdensome regulations during my time in the Senate. I encourage my 
colleagues to join me in this effort.
  Mr. President, I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. CASEY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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