    [Public Papers of the Presidents of the United States: WILLIAM J. CLINTON (1999, Book II)]
    [November 12, 1999]
    [Pages 2080-2082]
    [From the U.S. Government Publishing Office www.gpo.gov]

    [[Page 2080]]

    Remarks on Signing the Gramm-Leach-Bliley Act
    November 12, 1999

        Thank you, and good afternoon. I thank you all for coming to the
    formal ratification of a truly historic event. Senator Gramm and Senator Sarbanes have
    actually agreed on an important issue. [Laughter] Stay right there,
    John. [Laughter] I asked Phil on the way out how bad it's going to hurt
    him in Texas to be walking out the door with me. [Laughter] We decided
    it was all right today.
        Like all those before me, I want to express my gratitude to those
    principally responsible for the success of this legislation. I thank
    Secretary Summers and the entire team at
    Treasury, but especially Under Secretary Gensler, for their work, and Assistant Secretary Linda
    Robertson. I thank you, Chairman
    Greenspan, for your constant advocacy of the
    modernization of our financial system. I thank you, Chairman
    Levitt, for your continuing concern for
    investor protections. And I thank the other regulators who are here.
        I thank Senator Gramm and Senator
    Sarbanes, Chairman Leach and Congressman LaFalce, and
    all the Members of Congress who are here. Senator Dodd told me the Sisyphus story, too, over and over again, but
    I've rolled so many rocks up so many hills, I had a hard time fully
    appreciating the significance of it. [Laughter]
        I do want to thank all the Members here and all those who aren't
    here. And I'd like to thank two New Yorkers who aren't here who have
    been mentioned, former Secretary of the Treasury Bob Rubin, who worked very hard on this, and former chairman,
    Senator Al D'Amato, who talked to me
    about this often. So this is a day we can celebrate as an American day.
        To try to give some meaning to the comments that the previous
    speakers have made about how we're making a fundamental and historic
    change in the way we operate our financial institutions, I think it
    might be worth pointing out that this morning we got some new evidence
    on the role of new technologies in our economy, which showed that over
    the past 4 years, productivity has increased by a truly remarkable 2.6
    percent. That's about twice the rate of productivity growth the United
    States experienced in the 1970's and the 1980's. In the last quarter
    alone, productivity grew at 4.2 percent.
        This is not just some aloof statistic that matters only to the
    Federal Reserve, the Treasury, and Wall Street economists. It is the key
    to rising paychecks and greater security and opportunity for ordinary
    Americans. And the combination of rising productivity, more open borders
    and trade, working to keep down inflation, the dramatic reduction of the
    deficit and the accumulation of the surplus, and the continued
    commitment to the investment in the American people, research and
    development, and new productivity-inducing technologies has given us the
    most sustained real wage growth in more than two decades, with the
    lowest inflation in more than three decades.
        I can tell you that back in December of 1992, when we were sitting
    around the table at the Governor's Mansion trying to decide what had to
    be in this economic program, the economists that I had there--who
    normally are thought to be--you know, you say, well, they're Democrats;
    they'll be more optimistic--none of them believed that we could grow the
    economy for this long with an unemployment rate this low and an
    inflation rate this low. And it's a real tribute to the American people.
        So what you see here, I think, is the most important recent example
    of our efforts here in Washington to maximize the possibilities of the
    new information age global economy, while preserving our
    responsibilities to protect ordinary citizens and to build one nation
    here. And there will always be competing interests. You heard Senator
    Gramm characterize this bill as a victory for
    freedom and free markets. And Congressman LaFalce characterized this bill as a victory for consumer
    protection. And both of them are right. And I have always believed that
    one required the other.
        It is true that the Glass-Steagall law is no longer appropriate to
    the economy in which we live. It worked pretty well for the industrial
    economy, which was highly organized, much more centralized, and much
    more nationalized than the one in which we operate today. But the world
    is very different.

    [[Page 2081]]

        Now we have to figure out, what are still the individual and family
    and business equities that are still involved that need some
    protections? And the long and often tortured story of this law can be
    seen as a very stunning specific example of the general challenge that
    will face lawmakers of both parties, that will face liberals and
    conservatives, that will face all Americans as we try to make sure that
    the 21st century economy really works for our country and works for the
    people who live in it.
        So I think you should all be exceedingly proud of yourselves,
    including being proud of your differences and how you tried to reconcile
    them. Over the past 7 years, we've tried to modernize the economy, and
    today what we're doing is modernizing the financial services industry,
    tearing down these antiquated walls, and granting banks significant new
    authority.
        This will, first of all, save consumers billions of dollars a year
    through enhanced competition. It will also protect the rights of
    consumers. It will guarantee that our financial system will continue to
    meet the needs of underserved communities, something that the Vice
    President and I tried to do through the empowerment zones, the
    enterprise communities, the community development financial
    institutions, but something which has been largely done through the
    private sector and honoring the Community Reinvestment Act.
        The legislation I signed today establishes the principles that as we
    expand the powers of banks, we will expand the reach of that act. In
    order to take advantage of the new opportunities created by the law, we
    must first show a satisfactory record of meeting the needs of all the
    communities the financial institution serves.
        I want to thank Senator Sarbanes and
    Congressman LaFalce for their leadership on
    the CRA issue. I want to applaud the literally hundreds of dedicated
    community groups all around our country that work so hard to make sure
    the CRA brings more hope and capital to hard-pressed areas.
        The bill I signed today also does, as Congressman Leach says, take
    significant steps to protect the privacy of our financial transactions.
    It will give consumers, for the very first time, the right to know if
    their financial institution intends to share their financial data and
    the right to stop private information from being shared with outside
    institutions. Like the new medical privacy protections I announced 2
    weeks ago, these financial privacy protections have teeth. We granted
    regulators full enforcement authority and created new penalties to
    punish abusive practices. But as others have said here, I do not believe
    that the privacy protections go far enough. I am pleased the act
    actually instructs the Treasury to study privacy practices in the
    financial services industry and to recommend further legislative steps.
    Today I'm directing the National Economic Council to work with Treasury
    and OMB to complete that study and give us a legislative proposal which
    the Congress can consider next year. Without restraining the economic
    potential of new business arrangements, I want to make sure every family
    has meaningful choices about how their personal information will be
    shared within corporate conglomerates. We can't allow new opportunities
    to erode old and fundamental rights.
        Despite this concern, I want to say again, this legislation is truly
    historic. And it indicates what can happen when Republicans and
    Democrats work together in a spirit of genuine cooperation, when we
    understand we may not be able to agree on everything, but we can
    reconcile our differences once we know what the larger issue is: how to
    maximize the opportunities of the American people in a global
    information age and still preserve our sense of community and protection
    for individual rights.
        In that same spirit, I hope we will soon complete work on the
    budget. I hope we will complete work on the work incentives improvement
    act, to allow disabled people to go to work. And I know Senator
    Gramm has been working with Senator Roth and Senator Jeffords and Senator Moynihan
    and Senator Kennedy on that.
        There are a lot of things we can do once we recognize we're dealing
    with a big issue, over which we ought to have some disagreements but
    where we can come together in constructive and honorable compromise to
    keep pushing our country into the possibilities of the future.
        This is a very good day for the United States. Again I thank all of
    you for making sure that we have done right by the American people and
    that we have increased the chances of making the next century an
    American century. I hope we can continue to focus on the economy and the
    big questions we will have to deal with revolving around that. I hope we
    will continue to pay down our debt. I still believe in a global

    [[Page 2082]]

    economy. We will maximize the opportunities created by this law if the
    Government is reducing its debt and its claim on available capital. So I
    hope very much that that will be part of our strategy in the future.
        But today we prove that we could deal with the large issue facing
    our country and every other advanced economy in the world. If we keep
    dealing with it in other contexts, the future of our children will be
    very bright, indeed.
        Thank you very much. I'd like to ask all the Members of Congress to
    come up here while we sign the bill. Thank you.

    Note: The President spoke at 1:37 p.m. in the Presidential Hall
    (formerly Room 450) in the Dwight D. Eisenhower Executive Office
    Building. S. 900, approved November 12, was assigned Public Law No. 106-
    102.