C. Cox

Mr. COX of California

Mr. COX of California. Mr. Chairman, it is frequently said that lawyers are turning America into a nation of victims. Thanks to the trial bar which makes its living fanning these flames, not only real injuries but every imaginable harm is now compensable in court, except one; the one category of injury for which there is seemingly no recompense is injury inflicted by lawyers themselves. What is the remedy for the ruinous economic losses, the delays, and the sheer misery caused by the fraudulent abuse of our laws, in particular of our securities laws? The answer is none. None. Fraudulent securities litigation may be the most egregious instance of this cure today. It is a legal torture chamber for plaintiffs and defendants alike, more suitable to the pages of Charles Dickens' ``Bleak House'' than a nation dedicated to equal justice under law. The current system of private securities litigations is an outrage and a disgrace. It cheats both the victims of fraud and innocent parties by lavishly encouraging meritless cases, it has destroyed thousands of jobs, undercut economic growth and American competitiveness and raised the prices every American pays for goods and services. It mocks the many victims of real fraud who receive pennies on the dollar while the lawyers take millions. The only beneficiaries are the lawyers. Their clients typically get a pittance for their claims. Who are the victims of these strike suits which are brought to generate settlement value, which are brought in order to generate a nuisance value so that the lawyers can be paid simply to stop their harassment? First and foremost, victims of this kind of system are the victims of real fraud.The current system herds them into powerless classes of plaintiffs who are completely under the thumb of strike suit lawyers. The class members do not even have the chance to participate personally; oftentimes they are not even identified until very late in the proceedings. Earlier today we heard from a company in Arlington, VA, just across the river from the Capitol, who spent hundreds of thousands of dollars responding to one of these strike suits generated for the purpose of making the company pay the lawyers to go away. The class representative that was selected by these lawyers as the most representative of all of the plaintiffs finally sent a postcard to the company and ended it this way by saying, ``I did not know the lawyer was going to do this; he talked to my wife. He acted against my wishes. I was in the hospital at the time. I like your company.'' That is the degree to which class action lawyers are able to control this kind of litigation. The lead plaintiffs who supposedly represent the victims' interests are not average investors. As often as not the so-called lead plaintiffs are virtually employees of the counsel. As one of the leading attorneys in this area once put it, and as the gentleman from Louisiana [Mr. Tauzin] so eloquently reminded us, he said, ``I have the greatest practice of law in the world. I have no clients.'' That is the way class action securities strike suit lawyers view their opportunity to harass ordinary investors. The same stable of tame lead plaintiffs appears in case after case. That is why our bill puts a limit on the number of suits that professional plaintiffs can bring to five in every 3 years. How bad is this problem? Harry Lewis has appeared as lead plaintiff in an estimated 300 to 400 lawsuits. Rodney Shields has been in over 80 cases. William Weinberger has appeared in 90 cases just since 1990. One court recently called one of these professional plaintiffs the unluckiest investor in the world. Obviously, a wry sense of humor, that judge. With the lawyers in charge of the litigation, it is little wonder they manage to benefit their own interests at the expense of their clients. Many recent studies have shown that the current system encourages strike suits lawyers to ignore even overwhelming cases of fraud. Flagrant cases that should lead to 100 percent recovery are instead settled for cents on the dollar while the lawyers get millions in settlement fees. Even when the fraud victims get a full recovery the current winner- loses system unique to America still ensures they will never get fully compensated. Their attorneys' fees and costs come right off the top. And because the plaintiffs' lawyers, not the victims, control the litigations, they make sure those attorneys' fees are top dollar no matter how meager their clients' recovery. The current system ensures that investors will suffer ever more avoidable losses in the future. Even good faith reasonable predictions about the future events of a company's prospects are penalized under the current securities laws. The threat of lawsuits over so-called forward looking information, how is this company going to do in the future, is so serious that many if not most CEO's these days refuse to talk to the press at all about their company's performance and yet that is exactly the kind of information the market needs to operate. How a company has performed in the past is interesting, but everybody wants to know what is going to happen from here forward. the market is after that information they are now getting it through the black market and under the table. We would like to make sure that it is quality information, that a reasonable statement made in good faith should be available and should come from the source. Strike suits claim virtually every American as a victim. Most particularly by this I mean ordinary workers and consumers all are victims of the heavy litigations tax levied by strike suit lawyers. The tens of millions of dollars siphoned off each year by strike suits represents thousands of workers not hired, new products delayed or canceled outright and vital research that will never be done, and price increases imposed on consumers. This tax will fall most heavily on high-tech biotechnology and other growth companies, the very industry most critical to American competitiveness. One out of every four strike suits targets high-tech companies. High- tech and biotech companies have paid 40 percent of the costs of strike suit settlements handing out some $440 million, however, over the last 2 years alone. Strike suits claim a last category of victims: tens of millions of Americans who have invested in securities through their labor union pension funds, ESOP's or their individual mutual fund. They suffer twice. They suffer whenever price fluctuation triggers the suit, and they suffer again through the costs of litigating and settling the strike suits that follow. The current system is not protecting them; our legislation will.

Mr. COX of California. Mr. Chairman, I object.

Mr. COX of California. Mr. Chairman, will the gentleman yield?

Mr. COX of California. So I can fully and adequately respond to the gentleman----

Mr. COX of California. Well, reclaiming my time----

Mr. COX of California. I yield to the gentleman from Texas.

Mr. COX of California. Because many claims that could be asserted as securities laws claims can also be characterized as mail or wire fraud, and because mail and wire fraud are also predicates for civil RICO liability, Plaintiffs' attorneys have a devastating, potent, and readily available alternative for bringing actions under RICO instead of under our securities laws. As the SEC general counsel stated in his 1989 testimony before the House Committee on the Judiciary, and I quote now, The commission is concerned that the civil liability provisions of RICO can, in many cases, convert private securities law fraud claims into RICO claims. Successful plaintiffs in such cases are entitled to treble damages, despite the express limitations on recovery under the securities laws to actual damages. Private plaintiffs may be able to bypass the carefully crafted liability provisions of the securities laws and thereby recover damages in cases in which Congress or the courts have determined that no recovery should be available. Congress initially passed securities laws in order to impose a uniform system of duties and liabilities upon the securities industry and to protect investors. Each time we have acted to amend the securities laws we have balanced the need to provide the maximum amount of consumer protection against the need to maintain fluid, stable and reliable markets. Today we are seeking to enact litigation reforms because we have identified significant problems and abuses in the current system that are hurting investors, consumers, and the Nation as a whole. Mr. Chairman, the failure to adopt this amendment would undermine the reforms we are hoping to achieve because attorneys could then do an end run around all of the reform by simply using the RICO statute. In evading the reforms that we are seeking to achieve today enterprising lawyers will have the continuing ability to extort settlements from innocent defendants based on claims that will allow them no chance of recovery under the reforms that we have today. Lest we have any doubt about the ability of plaintiffs' attorneys to leverage settlements from defendants under civil RICO, we need only listen again to Justice Thurgood Marshall who explained that, quote, Many a prudent defendant, facing ruinous exposure, will decide to settle a case even with no merit. It is, thus, not surprising that civil RICO has been used for extortive purposes, giving rise to the very evils it was designed to combat. Mr. Chairman, unless we adopt my amendment, a plaintiff's attorney alleging a single violation of the securities laws will be able to bring an action under civil RICO and leverage a hefty settlement from an innocent victim. Because an element of RICO is a pattern, plaintiffs would have the latitude to conduct discovery of records dating as far back as 10 years. Discovery costs like that run up a tab of millions of dollars. Often, faced with the cost of these multimillion-dollar discovery fees, the prospect of being labeled a racketeer and the prospect of being held liable for treble damages and attorney fees, defendants, as Thurgood Marshall has said, are forced to settle meritless cases brought under RICO. Mr. Chairman, our economy's health depends on the efficient operation of America's capital markets. We must continue to balance the provisions of adequate remedies for injured investors and the imposition of excessive penalties on all participants in our capital markets. The treble damage blunderbuss of RICO undermines this balance and imposes exorbitant litigation costs, impedes the raising of capital, and

Mr. COX of California. As I mentioned, the Supreme Court, all of the Justices, both in the majority and minority of this RICO case, viewed this as an area where congressional action is richly needed because RICO, although technically being exploited within the letter of the law, was never intended to apply to securities cases. the gentleman which specifically related to----

Mr. COX of California. I thank the gentleman for yielding. I am disappointed with the intemperate remarks of the gentleman from Michigan who certainly knows that we have had ample testimony on the subject of RICO in many, many committees in this Congress over years and years and years which I recounted when the gentleman apparently was not on the floor commencing in 1985, dating all the way up to this year when just a few weeks ago, the current Commissioner of the Securities and Exchange Commission came before our Committee on Commerce and supported this amendment. He also has sent a letter to the current chairman of the Committee on Commerce supporting this amendment. I mentioned that Abner Mikva has testified before Congress in support of this amendment, in support of RICO reform. I mentioned that the Supreme Court of the United States when it examined this issue 10 years ago found that it is up to Congress to fix this problem and both the majority and the minority in that Supreme Court decision said that RICO is being stretched beyond what Congress originally intended in the securities area. I even quoted from Justice Thurgood Marshall. Thurgood Marshall was in the dissent, in the minority in that case, and it was Thurgood Marshall and Justice Powell who would have voted to limit RICO in the Supreme Court, but we are doing it here in Congress because majority said it is really Congress' mistake, Congress should fix it. The SEC's general counsel has testified in favor of this and we quoted from his testimony. I have submitted for the Record comments from judges across America who have said that this is an abuse. Almost all of the examples that we just recently heard were examples where criminal RICO, which is the whole bulk of the statute, civil RICO is only a few sentences, where criminal RICO should be used. It is certainly important that criminals be prosecuted and that is exactly what will happen before and after this amendment. But what we do not want to see is for our carefully crafted Federal securities laws to be shunted aside and instead for people to be able to use a statute never intended to apply in these civil cases in this way so that they can get treble damages, something not provided for in our securities laws, so that they can get discovery going all the way back 10 years to show a pattern which is part of RICO, not part of the securities laws, and in short so they can gin up settlements where a settlement is not in order. This is exactly the kind of securities litigation fraud that we are here to punish and we certainly should not do anything that would permit it to continue. I urge my colleagues very strongly to support his amendment. If there are no further comments, I would ask for a vote.

Mr. COX of California

Mr. COX of California. Mr. Speaker, I will reserve for general debate most comments on the substance of the legislation, but I would like to speak a little bit about the process by which this bill came through subcommitte, came through committee, after two hearings and is coming to the floor. I found, when I first was elected to Congress, that the House and the Senate were in the business, rather routinely, of producing thousand- page epics that nobody read. The S&L bailout bill comes to mind. Nineteen hundred and eighty-nine it came up here, drafted by the administration. Nobody in the House or Senate read it. We know that because it was not printed in the Record until after the vote took place. It happened that when we did the 6-year transportation reauthorization bill, even though I was on the Subcommittee for Surface Transportation, we did not get a markup for the 6-year transportation reauthorization, not in subcommittee, and in committee we got the whole bill the first time, and for the record my hands are probably a foot or so apart. The whole bill got plunked down on our desks the very day of the markup, and that was the first time we saw that bill, and then, when it went to conference, it was changed so dramatically that nobody knew what was going on. It was produced, I think, about three in the morning, or something, and we voted on this huge bill without anybody having read it or understood it. This has become rather routine. Contrast with the way the Congress used to run what we have been doing with securities litigation reform. We had two hearings, this Congress. We have had hearings in prior Congresses as well. The bill was bottled up in committee, and, after those hearings, we went to subcommittee markup, and we had a very long subcommittee markup that was so long that we were arguing about adjectival modifiers of words in particular lines. The bill itself is not very long, and of course everyone has read it. Then we went to full committee, and we made still more amendments. There was some criticism in full committee because amendments were allowed, that we were changing the bill in committee, although that is what markups are supposed to be all about, and here we are on the floor with a rule that is so open that just about everybody who wants to offer amendments is able to do so. Nonetheless, I understand how the ranking member might be upset because the bill came out of committee with only 10 Democrat votes. It was produced 33 to 10, a huge bipartisan majority for a very, very sound bill. If it did anything like what we have been hearing here on the floor today, of course those Democrats and all of the Republicans would not have voted for it, but it protects investors. It protects investors by providing a guardian ad litem or a steering committee that their class-action lawyer will now deal with to make sure that the clients get represented. It prevents bonus payments to favored plaintiffs in a class action so all the class is treated equally. It says that in the future the lawyers are going to have to pay attention to their clients when they file these kinds of lawsuits, and they are going to have to know that they have a case first so that the investors in a company that might be extorted from will also be protected. Finally I should point out that some of this I-forgot business relates to the fact that this is a fraud statute, it is not a negligence statute, and we do not have negligence in the securities laws now, nor will we have it after this bill.

Mr. COX of California

Mr. COX of California. Mr. Chairman, I move to strike the requisite number of words. Mr. Chairman, I think we can all agree that there are meritorious arguments on both sides of this debate. But it is interesting to note, having weighed the arguments on both sides, who agrees that the gentleman from Ohio [Mr. Hoke] is offering a sound amendment, that Mr. Hoke has a good idea. I confess that I am myself a recovering lawyer. I practiced for about 10 years before I came to the Congress, and I was trained in Harvard Law School. The president of Harvard, Derrick Bok, is in favor of this amendment. Harvard is not a conservative place as far as I know. I had a teacher there whose name is Petovsky. He is about to be nominated and confirmed by the Senate to be Bill Clinton's head of the FTC, and Professor Petovsky thinks this is a good idea. The head of the ACLU, last time I checked a left wing organization, thinks this is a good idea. ACLU president Norman Dorsen has endorsed the idea behind the amendment offered by the gentleman from Ohio [Mr. Hoke]. Now, whenever the head of ACLU and Judge Bork agree, Mr. Chairman, I think we ought to take a look and find out why it is that they think this is a good idea, and it turns out that this is not at all an attack on contingency fees, which just about everybody that I just named thinks ought to remain as part of our legal system. Rather it is an attack, and I will be delighted to yield in just a moment, as soon as I make my few points--rather this is an attack on the use of the contingency fee arrangement when there is not any real contingency. It is thought to be in, I believe, all 50 States under the bar rules a matter of ethics that you should not try and seek to obtain a contingency fee when they, the lawyer, know that there is really no authentic risk, and the Hoke amendment gets to that very point in a very useful way. He says, if somebody, 60 days after the start of the dispute, offers to settle the case for a particular amount of money, that that amount of money is no longer a contingency because they get that if they settle. Now it was said, If you reject that settlement and go on and only get a contingency fee on the amount in excess of the settlement, that that is somehow unfair, and I agree that is unfair, but the amendment, as offered by the gentleman from Ohio [Mr. Hoke] does not limit the lawyer to a contingency on what is really at risk. It also gives him, on top of that, 100 percent of his reasonable hourly rate, which is agreed upon objectively. In that circumstance I think we should all agree that it is consumers who are being protected. I say to my colleagues, ``When you go to the garage, and you ask the mechanic if there is something wrong with your transmission, you depend rather heavily on that garage mechanic to tell you the truth.'' That is why, in fact, we regulate that industry for the benefit of the consumers, so that consumers do not get ripped off because they, frankly, do not know what is going on in the drive train under the hood nine times out of ten. They are experts at some other part of life. Likewise, Mr. Chairman, the lawyer is in a unique position to assess the contingency, and the client is taking the lawyer's word for it. If it turns out there is nothing at risk, which is clearly the case if the other side in 60 days offered to pay that full amount of money, is it not unfair to collect a contingency fee against it? The contingency fee runs 30 to 40 percent, sometimes higher, if it is not limited, of the settlement amount or of the eventual verdict. That is taking away from the consumer the amount that the court or the jury has just awarded to him. It is grossly unfair. Ultimately two things are at stake here, ethics and consumer protection. it is consumers that we are supposed to be protecting here, and it is the ethics of the profession, in my view, in need of some ethical regulation that this amendment would get after.

Mr. COX of California. I yield to the gentleman from Michigan.

Mr. COX of California

Mr. COX of California. I thank the Chairman. Mr. Chairman, I just point out that the language of the amendments says reasonable. It also says arbitrary. But a separate standard is reasonable. It is arbitrary or unreasonable. Obviously, the reasonableness test is the more difficult to meet. Simply stated, the Federal courts will defer to reasonable decisions on the facts, reasonable decisions on the law, and reasonable decisions on mixed questions of law and fact made at the State courts. That is exactly what they should do because after all we are already requiring in this bill that criminal defendants exhaust all of their State remedies, if they go through trial, if they have an appeal, if they have another appeal, and so on. All of this within the State court system. But if habeas corpus, statutory habeas corpus is available simply to throw out the whole State judicial system, why do we have it in the first place? If we are going to look at all of these questions from scratch, de novo, facts, evidence, law, the whole thing, as if the State proceeding had never happened, then Robert Alton Harris would be able to, in the future, to be able to delay his execution for 13 more years. (The letter referred to by Mr. Cox of California is as follows:) February 8, 1995. Hon. Henry Hyde, Chairman of the House Judiciary Committee, Rayburn House Office Building, Washington, DC. Dear Chairman Hyde: We would first of all like to thank you for your tireless effort on behalf of habeas corpus reform. As Attorneys General for our respective states we are confronted with a system of federal habeas review that is often intrusive, cumbersome, and time consuming. It also imposes a great cost on victims of crime and undermines finality in our criminal justice system. The central problem underlying federal habeas corpus review is a lack of comity and respect for state judicial decisions. The lower federal courts should simply not be relitigating matters that were handled properly and reasonably by the state judicial systems. This not in any way a criticism of those who serve in the federal judiciary, but rather a demonstration of the need for Congressional action to reform the federal statutory scheme. In this regard, we strongly support an amendment that will be offered by Congressman Christopher Cox to title I H.R. 729, which would give deference to state court decisions on federal habeas review, as long as the state courts acted reasonably in their adjudication of the case. Specifically, the amendment would provide: An application for a writ of habeas corpus on behalf of a person in custody pursuant to the judgment of a state court shall not be granted with respect to any claim that was decided on the merits in state proceedings unless the adjudication of the claim: 1. resulted in a decision that was based on an arbitrary or unreasonable interpretation of clearly established federal law as articulated in the decisions of the Supreme Court of the United States; 2. resulted in a decision that was based on an arbitrary or unreasonable application to the facts of clearly established federal law as articulated in the decisions of the Supreme Court of the United States; or 3. resulted in a decision that was based on an arbitrary or unreasonable determination of the facts in light of the evidence presented in the state proceeding. We believe that meaningful habeas corpus reform must contain such a standard of deference to reasonable state court decisions. This is essential if the trial of criminal defendants is to be the ``main event'' rather than a sideshow for ultimate resolution of the case on federal habeas corpus review. Thank you again for your continued effort on behalf of prosecutors and crime victims. We look forward to working with you on this and other issues in the future. Sincerely, Dan Morales, Attorney General of Texas; Grant E. Woods, Attorney General of Arizona; Franie Sue Del Papa, Attorney General of Nevada; Daniel E. Lungren, Attorney General of California; W. A. Drew Edmondson, Attorney General of Oklahoma; Joseph P. Mazurek, Attorney General of Montana; Pamela Carter, Attorney General of Indiana, Jeff Sessions, Attorney General of Alabama; Ernest D. Preate, Jr., Attorney General of Pennsylvania.

Mr. COX of California

Mr. COX of California. Mr. chairman, I yield myself such time as I may consume. Mr. Chairman, I rise to offer a simple common sense amendment to H.R. 729. My amendment, which I am calling the Harris amendment, provides that a habeas writ will not be granted when State court decision reasonably interprets and Federal law reasonably interprets the facts of the case and reasonably applies the law to the facts, or to put it simply, State decisions that are reasonable on the law and the facts will be upheld by a habeas review. The purpose of my amendment is to prevent the use of endless appeals to frustrate the punishment of already convicted criminals, including first degree murders. We do not have a Federal Criminal Code. We have, in chief, a State criminal justice system. When one commits murder, rape, robbery, and so on, all of these are offenses against State law. Our Federal criminal jurisprudence is a gloss on that State criminal justice system. The Federal procedural rules, in fact, operate in many cases as a frustration to the State system. So we find that there are egregious cases, and all too many of them, of convicted first degree murderers who have run all of their appeals in the State criminal justice system, who then get another bite, and another bite at the apple, seemingly endlessly in the Federal system, and who have been able, through the abuse of the habeas device, to postpone their executions, seemingly indefinitely. I said I am calling this the Harris amendment. It is so named after Robert Alton Harris, the notorious first degree murderer who postponed for well over a decade his own execution through the abuse of the device of Federal habeas corpus, statutory habeas corpus. Harris, even before the murder conviction that was the subject of that long legal odyssey, was already a murderer. He had been convicted of murdering a 19-year-old boy in California. For this he served 2 years and 5 months, and he was out on parole, went out on parole, and he and his brother decided that they ought to rob a bank. They went after the San Diego Trust and Savings Bank. They decided they needed to steal a getaway car. So they headed out for the Jack-in- the-Box, in San Diego, and they spotted two high school sophomores, John Mayeski who was 15, and Michael Baker was 16, sitting in their Ford LTD eating Jack-in-the-Box hamburgers. Let me quote from the January 17, 1990, San Francisco Chronicle article about this terrible crime. Armed with a 9mm Luger automatic pistol, Robert Harris commandeered Mayeski's car and ordered the two boys to drive him to a them no one would be hurt. Daniel Harris, who later became the chief prosecution witness against his brother, followed in another car. He testified that they drove to the lake, where Robert Harris fired two rounds into Mayeski, then went after Baker, who was running for his life. ``I went over to John after he was shot. I looked at him for three or four seconds, I guess. I heard some screaming from the bushes, then three or four shots,'' said Daniel, who served three years in Federal prison for his role. Later after he was arrested, Robert Harris boasted to his cellmate that he told the terrified Baker boy to quit crying and die like a man. When the boy started to pray, Harris said, ``God can't help you now, boy. You're going to die.'' After the murders, Robert Alton Harris and his brother finished the boys' half-eaten hamburgers. They then went on to rob the bank. In one of the great ironies of this case, one of the police officers who ended up apprehending Robert Alton Harris was the father of one of their murdered boys. Unfortunately, this case is not unique. There are many, many cases like this. But Robert Alton Harris' case took a long time to lead to his conviction. It was 1979, a year later, when the Superior Court pronounced judgment on him. It was years later when finally the Governor denied his application for clemency. It was years later when he filed his ninth State habeas corpus petition, and he was already then on his fourth Federal habeas corpus petition. In 4 days, Harris filed a fifth and sixth Federal habeas corpus petition. He was not executed, even though this crime occurred in 1978, until 1992. To repeat, this crime that I have described in some detail occurred in 1978. The judgment was pronounced in 1979, but it was not until 1992, a total delay of 13 years from judgment, that Robert Alton Harris finally finished abusing Federal habeas corpus and was executed. That made him only the second person executed in California under our death penalty since 1978. We have 400 prisoners sentenced to death in California since the State reinstated the death penalty in 1978. Only two, Robert Alton Harris and David Mason, have been executed. Today there are 125 California death penalty cases before the Federal courts, and because of the abuse of Federal statutory habeas corpus and this device of endless appeals, we will never perhaps be able to execute these convicted first-degree murderers. As the Powell Commission wrote, ``The relatively small number of executions as well as the delay in cases where an execution has occurred makes clear that the present system of collateral review,'' referring to statutory habeas corpus, ``operates to frustrate the law.'' Opponents of reform correctly state that our whole system of criminal justice rests on the premise that it is better for 10 guilty men to go free than for one innocent man to suffer, and for that reason, the Constitution requires the States and the Federal Government to provide every criminal defendant the full panoply of protections assured by the Bill of Rights, an unrivaled arsenal of procedural and substantive rights. And that is why, after cases have been fully litigated through the State judicial system, habeas corpus review is available in Federal court, a duplicative system of review that, as Justice Lewis Powell has written, ``is without parallel from any other system of justice in the world.'' The question before us today is not the availability of that habeas review, but, rather, the standard that the Federal courts will use so that we can avoid the kind of repetition and abuse that we saw in the Robert Alton Harris case and that we see in so many cases throughout the country. The reasonableness standard that I am proposing is already used for factual determinations in habeas cases pursuant to statute and for legal determinations in many cases. This reasonableness standard respects the coordinate role of the States in our constitutional structure, while assuring ample Federal review of State determinations of law and fact. It strikes a sensible balance that is consistent with the interests of defendants, victims, and States. It is supported by crime victims and law enforcement professionals around the country, including the National District Attorney's Association, which has written to all of us in this Chamber about urging our support for what they call the Cox amendment, what I am calling the Harris amendment, the California District Attorneys' Association, my home State, DA's around the country through the National DA's Association, and as I mentioned, Citizens for Law and Order, and victims' rights groups from across the country and coast to coast, Democrat and Republican attorneys general alike, including the AG's in Texas and California, Democrat and Republican. I urge your strong support for this strong habeas reform. Mr. Chairman, I reserve the balance of my time.

Mr. COX of California. Mr. Chairman, if the gentleman will yield, for that purpose I would defer to the gentleman from Florida [Mr. McCollum].

Mr. COX of California. Mr. Chairman, if the gentleman will yield, in informal discussions on the floor prior to offering the amendment, our side was asked whether we would be agreeable to a limitation on debate. It is not my personal intention in any way to limit debate, but there were Members on the Democratic side who were interested in proceeding in a timely fashion. That is the only purpose for the unanimous consent request that is now on the floor.

Mr. COX of California. Mr. Chairman, I also ask unanimous consent that debate be limited on both sides, for purposes of this amendment and any amendment thereto, to 10 minutes on each side.

Mr. COX of California. Mr. Chairman, I offer an amendment.

Mr. COX of California

Mr. COX of California. I thank my colleague for that gracious introduction and for yielding to me. Mr. Chairman, H.R. 2, the Line Item Veto Act, is something the American people have wanted for a long time. It is a fitting tribute to their tireless efforts, as well as to the tireless efforts of one man who has been mentioned here several times in the course of this debate, Ronald Reagan. Next Monday, February 6, Ronald Reagan will celebrate his 84th birthday. It is absolutely fitting that we will vote on final passage of H.R. 2 on Ronald Reagan's birthday. A decade ago Ronald Reagan said about the line-item veto, ``No other single piece of legislation would so quickly and effectively put order back was 10 years ago. It will restore what the Founders saw as the strongest deterrent to wasteful spending by Congress, an energetic executive with the power to force a thoughtful and thorough debate on individual items of spending. H.R. 2 will reverse some of the damage that was done by the 1974 Budget Impoundment and Control Act, passed by a liberal Congress at the height of its powers as a slap at President Nixon, then at the depths of his disfavor with the Congress. It radically shifted the respective powers of the legislative and executive branches and emasculated the President's impoundment authority, substituting weak powers of deferral and rescission which this Congress has ever since 1974 chosen to override. Since 1974, this Congress has chosen to ignore almost every rescission request proposed by every Republican and Democratic President. In the 2 years that I worked in the White House, President Reagan issued over 400 rescission requests, they totaled over $18 billion. Do you know how many the Congress voted on? Not a single one. Mr. Chairman, James Madison once wrote that unless kept in check, Congress would be everywhere extending the sphere of its activity and drawing all power into its impetuous vortex. James Madison was right. Congress' spending appetite needs to be controlled. H.R. 2 is a solid step on the way to doing just that.

Mr. COX of California

Mr. COX of California. Mr. Speaker, I rise today to pay tribute to the Newport Harbor High School football team, which completed its first undefeated season in 64 years by winning the California Interscholastic Federation championship title. Led by Head Coach Jeff Brinkley, the Sailors' triumphant season was the culmination of an extraordinary year for these young men. It was a year that was marked not only by notable individual accomplishments and exemplary team play but also by a tremendous sense of courage and determination rarely seen in prep football. The coaching staff, the players, the fans all made their dream a reality. Mr. Speaker, it is with great pleasure that I ask my colleagues to join with me in saluting the Newport High School football team and to congratulate their championship year.

Mr. COX

Mr. COX. Mr. Speaker, I am delighted to be here in support of abolishing the practice of baseline budgeting, which is the accounting gimmick by which for so many years Congress has called a spending increase a cut. This really has gone on just last year. Just this past year Republicans proposed reforming the State Department, a regular target of reform. Under this reform proposal, actual spending on State Department functions would have increased by $25 million year to year, but the opponents of the reform cried ``foul.'' They said, ``You are spending less money, you are slashing the budget of the State Department by $77 million.'' One person's increase is How does this work? Let me demystify it. We just finished New Year's Day and a lot of people spent time in front of their television sets eating take-out pizza. Let us imagine last year on New Year's Day you ate five pieces of pizza. This year, it was so much fun last year, you decided to eat 10 pieces of pizza. Your friends told you that would be truly piggish, you ought to cut back, so you settle on seven. Under baseline budgeting you can claim to have slashed your pizza consumption by 30 percent because you are only having 7 pieces instead of the 10 that you want. What we are going to say in this reform is, you are increasing your pizza consumption 40 percent. Be honest with yourself. You are having seven this year instead of the five you had last year. That is real budgeting, real figures, something the American people can understand. Thomas Jefferson once noted ``He who permits himself to tell a lie once finds it much easier to do so a second and a third time. The falsehood of the tongue leads to that of the heart, and in time, depraves all good dispositions.'' Mr. Speaker, Jefferson was right. The baseline is a lie. It is one that has eaten away at the credibility of this Congress. It is time we repeal the practice forthwith. I am delighted to be here urging my colleagues to vote aye on this important reform.