Peter DeFazio

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, those who were watching television just before the vote would have been treated to a softball interview with Mr. Harvey Pitt. Mr. Harvey Pitt is a former lobbyist for securities firms and accounting firms and, knowing so well the backrooms, he was named by the President of the United States to be our chief watchdog when it comes to securities enforcement. There is a little problem with Mr. Pitt as a watchdog, unfortunately. He is so ethically and morally compromised, he often cannot vote. Recently, the Securities and Exchange Commission staff provided a compelling case against Ernst & Young, an accounting firm. There were three commissioners present, and apparently they found the evidence compelling, but unfortunately two of them were so ethically and morally challenged, both appointees of President Bush, Mr. Pitt, the chairman, and another member, they could not vote. The only person that could vote was a Clinton holdover. He did not have the ethical problems of voting for or against his former clients and buddies and he voted to fine them. An administrative law judge threw it out. So here we have it. The chief enforcement arm of the United States Government to rein in corporate misconduct, securities fraud, the accounting firms, and the chairman cannot vote. In his first 10 months in office, he had to recuse himself from voting 29 times because these were all people whom he had represented and he will represent again soon when he leaves his position as chair of the Securities and Exchange Commission. This is the tough new Securities and Exchange Commission which is supposed to instill confidence? Mr. Pitt carried on at great length about what he really cares about is the little guy, you know, Main Street. I do not think Mr. Pitt has seen Main Street from his penthouse apartment, his thousand-dollar-an-hour consulting with these securities and accounting firms for a heck of a long time, except maybe from the tinted windows of his limousine. He has represented other outstanding folks: MCI, WorldCom, a $4 billion problem there. Merrill Lynch. Arthur Andersen. Whoops. Yeah, a little bit of a problem there. In April he met with a former client, KPMG Consulting, while their audits were being investigated. He said, ``Hey, you can't tell me that I can't meet with people who I worked for who are currently under investigation because I wouldn't be able to meet with anybody.'' This is our chief watchdog, Harvey Pitt. Harvey Pitt. Yes, perhaps he would be a great enforcer because he knows all the backroom tricks. One of the big problems we have was conflicts of interest with the accounting companies. Mr. Pitt as a $1,000-an-hour lobbyist/lawyer, he always talks about himself as a lawyer, not a lobbyist--he was a lobbyist with a law degree and a license to practice law--had in fact worked very hard to prevent those conflict of interest rules from going into effect which, of course, allowed many of the current accounting shenanigans to go forward because these same firms, Arthur Andersen and others, were selling services to the companies that they were supposedly providing arm's length auditing services to and the companies were not going to be real eager to buy those services if their CEO was not earning tens or hundreds of millions of dollars of bonuses by inflating their earnings reports and having the accounting firms sign off on it. This is our chief watchdog. It is not just his actions that belie Mr. Pitt. It is his words. When he was sworn in, he said the SEC will be a kinder and gentler place for accountants. He would have us believe that now he has become a veritable pit bull of enforcement, that he is the best person for the job. It is extraordinary that the Bush administration has not joined notables such as Senator John McCain in asking for Mr. Pitt to resign. He is an embarrassment to this administration. To have a chief law enforcement officer who cannot enforce the law because he is so morally and ethically compromised, he cannot even vote on enforcement actions recommended by his own staff and investigators. It is time for Mr. Pitt to go if you want to restore some modicum of faith in how straight these markets, these reports and these investigations are.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, the President gave a stunning speech the other day and talked about corporate responsibility. This is the new face of corporate responsibility, the chief law enforcement officer of the Securities and Exchange Commission. His name is Harvey Pitt. He is a former lobbyist for securities firms and accounting firms, and as a lobbyist, he opposed all reforms and tightening of regulations. He was not there at the President's speech and some would say, well, the President's trying to kind of hide this guy because he is an embarrassment. Well, no, despite the fact that some of us think there is a crisis in corporate ethics and the meltdown and the bankruptcies and the pension losses and the tanking of the stock market and all the basic outright thievery that was going on, he was at the beach on vacation, but it really does not matter much because Harvey Pitt is so conflicted he cannot vote as the chief law enforcement officer of the Securities and Exchange Commission. They were recently undertaking an enforcement action against an accounting firm. There were three commissioners present. They heard the evidence of the staff. It was compelling. They wanted to prosecute that firm, but Mr. Pitt had to say, oh, excuse me, they are my former clients, I represent them, I cannot vote. The other woman commissioner there said, gee, actually, I represented them, too; I cannot vote. So there was one commissioner left who could vote, a Clinton appointee, who did not have a conflict of interest. He voted to prosecute them, but then they appealed to an administrative law judge and said, hey, you cannot convict us with one vote, and in fact, the administrative law judge said you are right. So here we have the new push for corporate accountability and responsibility, and we have a Securities and Exchange Commission that cannot prosecute anybody because two of the three sitting members named by President Bush are so conflicted because these are their former clients and their future clients when they leave their so-called public service they cannot vote. So this is wonderful. We can talk about getting tough, but nobody is going to be prosecuted, fined or go to jail. It is a very interesting sort of turn of events. Mr. Pitt has had and said some pretty interesting things. Here is his philosophy as the chief law enforcement officer of the Securities and Exchange Commission. In general, Mr. Pitt said in November, My preferred approach to any regulatory issue is one in which the government's participation is as limited as reasonably possible. Well, he is at the beach and he cannot vote so I guess he is following his own provisos here. Then we have his other famous statement when he was first sworn in. He went up to his buddies on Wall Street, had lunch, had a great time, lot of champagne and stuff. They are celebrating his becoming their regulator because they knew they would not have to worry much, and he said and promised, ``a kinder and gentler place for accountants.'' The crooks could come to Harvey, share lunch, and it would be a kinder and gentler SEC. If my colleagues saw the President's speech, there was this wonderful backdrop. Corporate responsibility, it said time and time and time again so one would not miss the message, even though, of course, the President was not advocating anything new or anything stringent or anything that might really jeopardize any of his corporate friends and contributors. Actually, what most people in the public do not know is actually that was the punishment. There was already very stiff punishment levied on those Wall Street tycoons. They had had to write 1,000 times on the wall ``corporate responsibility'' before the President's speech. That was their punishment, and that is about the only punishment they are going to get out of this administration.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, the gentleman from Florida talked about the phony reform that was passed by this House and the fact that the Senate will not take it up. Thank God for the Senate. That was a phony reform. It was written by the securities industry. It was written to touch them with a feather duster. Now there are corporate evildoers abroad in the land, and they have stolen and diverted billions, bankrupted firms, thousands of hardworking Americans have lost their jobs, millions of seniors' savings and pensions evaporated, and even the President has noticed. He went to Wall Street to admonish his corporate contributors not to do it again, but not to worry, Harvey Pitt, the former security firm lobbyist, has been named to head the enforcement agency, but he did not go to the President's speech because he was on vacation at the beach hobnobbing with the same corporate evildoers he is supposed to be investigating, his former clients. We do not have to worry about a thing, I guess.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I move to strike the last word. Mr. Chairman, it is not often I disagree with the gentleman from Minnesota (Mr. Oberstar), who knows more about aviation than probably everybody on the floor of the House put together, but I do respectfully rise to disagree with his conclusion that Members should vote against this bill. Let me quickly lay out a case. The threshold was crossed on a bipartisan basis by the Democrats and the Republican leaders of the Committee on Transportation and Infrastructure that there is a credible threat that continues in aviation. I can tell you it is going to be a very, very long time, if ever, before we have flight decks similar to what El Al, has where the pilots can go in and stay there until they land because they have a lav and food service. We are not even anticipating that. We are seeing the FAA drag their feet on just giving us a door that can't be battered down by a deranged individual from Brazil with his head. They are dragging their feet on that, so it is going to be a long time before those flight decks are as secure as we want. At El Al, until they reached that point in time, they did arm their pilots. They never had an incident. These are highly trained people. These are people you trust with your lives every week when you fly in those planes. These are people who do not want to feel helpless in losing control of their airplane to terrorists. I am not going to say this is the most credible threat. Personally, I believe explosives are the most credible threat to killing people, maybe even personal explosives. This continues to be a threat, and the leaders of the committee decided it was a threat, so the question becomes, why should we at that point restrict to 2 percent, which would be known to every terrorist in the world, of the pilots, on a daily basis? That would mean that less than one-half of 1 percent of the pilots flying would be armed because of the flight schedules they keep on a monthly basis. So if you are a terrorist intent on mayhem and your chances are 99.5 to 1 that you are going to be successful, you might just take a chance. But with this amendment, we have created the uncertainty. I would suggest that we will classify the number of pilots who have undergone the training and qualified, and it will be just like the sky marshals. You are not going to know how many of them are up there or whether they have a gun or do not have a gun. You are going to create that element of uncertainty for these people, so then they will try maybe some other place in the system to get us, and we have to be closing those gaps with explosives and maritime and all those other things. So I respectfully disagree with the gentleman's conclusion that because of that we should vote against this bill. There is still administrative discretion. There will still be a conference with the Senate. If the gentleman finds horrible problems in terms of the pace or whatever, we can work on those things. But to kill the bill now would be to deny the threat that was identified on a bipartisan basis by the leaders of the committee and the American public and deny the American public this credible protection.

Mr. DeFAZIO. Mr. Chairman, today the gentleman from Washington (Mr. Nethercutt) and others and I rise in support of the base bill, but in the hopes of improving the legislation. We are concerned that by specifying a cap on a reluctant administration, an administration, a President and a head of the TSA who do not want to arm pilots, that by setting a very, very modest goal of 2 percent, a cap of 2 percent, without mandates, that they move ahead expeditiously with that program, that we are not going to adequately meet the identified threat. Virtually everyone who has spoken today basically subscribes to the idea that the flight deck should be defensible, the weapons in the bill would not come away from the flight deck, they would be used to defend the flight deck. But the point is that under this legislation, if this reluctant administration moved quickly and expeditiously to the cap of 2 percent, on a daily basis, given pilots' schedules, one could be certain that less than 1 percent of the pilots flying were armed. Now, I do not believe a chance of one in 100 is a significant deterrent to a suicidal, homicidal terrorist intent on causing death and destruction. So I really feel that by putting that cap in the bill that we would be making a mistake. I do not see why we should not set a goal of saying in an orderly basis, as we are hearing from the gentleman from Kentucky (Mr. Rogers), as much as we can afford to finance, and I believe that security is worth financing, we should move forward with training all pilots who meet the minimum qualifications, and then all pilots who pass the proficiency test and pass through the training should be allowed, until the day when we have armored flight decks, flight decks which are secure, and which provide for the necessities of food and lavatories for the pilots where they do not have to come out at all, that we would continue to have pilots armed until that point in time. That is what El Al did. Their pilots were armed until they came up with these secure flight decks where the pilots do not have to come out at all. The door is locked. They do not come out until the plane lands and the engines are shut down. Now, the FAA says it is impossible to design that kind of a flight deck, and they are going to take a few years to approve the design, so we are a long way away from that here in the United States. Beyond that, we are not even envisioning one where they would have lav services, because that would cause some more money to redesign those planes. So we may be decades away from that. So we should not have a bill that sunsets in 2 years. We should not have a bill that limits to 2 percent because, remember, the hard and fast bottom line here is there are standing orders from the President of the United States of America that if another plane is commandeered, that that plane will be shot from the sky. That is a horror beyond imagination for the pilot with the order to do that, but a horror that they would have, to avoid even more mayhem on the ground. It should not ever come to that. Why not have this adequate, last line of defense, and that is what it is, defense. Some say, oh, we are worried about the pilot running down the cabin with the gun or wandering the airport with the gun. All of those problems can be resolved. It should be a defensive weapon in the flight deck. I urge people to try these stun guns. You get one shot, and it takes about 10 seconds to reload and you get another. That is not going to work against perhaps one or more than one determined terrorist trying to storm a flight deck. A legal force to repel murderous intent, I believe, is justified. The bill recognizes that, but it has these defects. I urge the Members to support this amendment.

Mr. DeFAZIO. Mr. Chairman, I offer an amendment.

Mr. DeFAZIO. Mr. Chairman, I thank the gentleman for yielding me this time, and I want to address the issue the gentleman from California (Mr. Horn) raised in the well about the rest of the flight crew, the flight attendants, on board the plane. It was absolutely positively the intention of the Members of this House and those who drafted the aviation security bill last fall that they would get adequate training, both in the issues of self-defense and crew coordination, and all the things that are necessary for those people who are so exposed on the other side of those doors that are slightly reinforced at this point in time. Unfortunately, many of the airlines, because of the expense and the inconvenience in scheduling involved, have chosen to either stiff or short that training requirement: a 15-minute video on self-defense. And having studied a number of martial arts, I can tell my colleagues that that is not going to do much for a lot of people. As I spoke here earlier, we are using flight attendants directly. In the case of United's policy, they wheel out the food cart and they stand behind it, and they are supposed to defend the flight deck while that door is open against terrorists, after having watched the 15- minute video. There has been no serious consideration by the administration of whether or not nonlethal devices or other things should be made available to the flight attendants. So the improvements in this bill should send a strong message to the TSA, to the FAA, and to the airlines that we do not want more delay; that the flight attendants are at risk, they are a critical part of solving this problem, and they need the training and the tools. It is a minuscule cost to the airline; certainly a lot less cost than the tragedy of another lost plane. So I congratulate the leaders of the committee on the inclusion of some stronger language and hope we can even push that further and make certain that this gets done.

Mr. DeFAZIO. Mr. Chairman, I thank the gentleman for yielding me the time. As the gentleman from Minnesota (Mr. Oberstar) and others who have preceded me have said, we passed an excellent aviation security bill last November. Unfortunately, it is yet a work in progress. There are many incomplete measures, some of which are moving along with acceptable speed, others which are not. I am particularly concerned about whether or not we can meet the deadlines for detecting explosives and do believe this is a very real threat, including individually carried explosives similar to suicide belts; and we need to be adopting new measures to deal with that. The flight deck doors are of particular concern. The FAA is going along at its normal speed, which is 5, 10, 15 years to certify a minor change to an aircraft, in terms of approving these long-designed armored flight deck doors which are in use by foreign airlines. Without those armored flight deck doors, flight decks are still vulnerable, including the vulnerability that will not even be accommodated then, which is to put them behind a door similar to El Al, which includes a lav and food service. On my cross-country flight on Monday, I observed the door to be open for a total of more than 15 minutes, at one point for 8 minutes consecutively while the three people on the flight deck shuffled around to the bathroom, got a cup of coffee and shot the breeze with the flight attendant, who was standing menacingly behind the food cart to keep the terrorists from rushing the flight deck. That is not security. That is not decent security at all. The issue now comes to, what about this last line of defense? We have already heard about the standing orders to shoot down civilian aircraft that have been commandeered. That would be a horrible, horrible thing, but potentially less horrible than another guided attempt of using one of our civilian airliners as a weapon of mass destruction and killing thousands more on the ground. It should never get to that point. And when we fully implement the measures that we passed last November, it is improbable that someone will be able to access the airplane with sufficient weaponry to take it over. But until that is done, until we have the armored flight deck doors, I believe other measures are necessary, including the arming of pilots. I am disturbed that President Bush is so strongly opposed to the arming of pilots. As a former part-time fighter pilot in the National Guard, he should certainly understand the gravity of the order that would be given to a full-time pilot or another National Guard pilot to shoot down a civilian aircraft that has been commandeered, and he should be appalled by that; and I cannot understand the President's absolute objection to the arming of pilots. So I believe it is wise for the House to move forward and mandate that this go forward. I will, however, be supporting an amendment to make the program available to all qualified pilots who can qualify with the weapons and pass the training, including the other provisos about the testing of weaponry and the appropriateness of ammunition and things like that, because, to me, the issue here is, if the threat exists, why would we limit it to 2 percent of the pilots, because if we limit it to 2 percent or less of pilots, and since his administration, the President does not want to arm these people, we will expect they will move very slowly toward that 2 percent target. That would mean that on any given day less than 1 percent of the pilots in the air potentially would be armed as a last line of defense against a takeover. A terrorist might think odds of 99 to 1 are pretty darn good. I would buy a lottery ticket if my odds of winning were 99 to 1. So we are going to offer an amendment later with the gentleman from Washington (Mr. Nethercutt) and others to lift the cap and allow the administration to rethink its position and hopefully move ahead expeditiously with training with a much larger number of pilots, all those who volunteer. It would only be voluntary because some pilots do object to this procedure. So I look forward to a vigorous debate over that amendment, but I certainly support the base bill.

Mr. DeFAZIO. Mr. Speaker, I thank the gentleman for yielding me time. There is, as the gentleman preceding me in the well said, an ongoing threat. In fact, there are threats to all facets of transportation, and we cannot ignore one in favor of another. Unfortunately, we do not have that luxury. But in the case of aviation, I do believe there is an ongoing threat. It may not be the commandeering of aircraft and their use as weapons of mass destruction again. It may be more the threat of explosive devices, either individual or baggage or freight carried. But we cannot ignore the fact that our planes were commandeered, that innocent people were slaughtered and civilian airliners were used as weapons of mass destruction; and we have not yet totally assured that that cannot happen again. The flight decks are still vulnerable. On the flight I took on Monday, I just watched on my watch, they had a particularly lackadaisical pilot and flight crew; they left the door to the flight deck open for 15 minutes during one cross-country flight, while the flight attendant, who has not yet had any training from United Airlines, stood menacingly behind the food cart to ward off any attempts to overtake the flight deck. That is not real security. The issue before the House today will be of arming pilots. Now, either we assess that there is a credible threat, or there is not. If there is a credible threat, the base bill before us today makes little sense. It would say that no more than 2 percent of the pilots might be armed, trained and armed; no more than 2 percent. Given pilots' flight schedules, that means on a daily basis less than three-fourths of 1 percent of pilots might be armed. Now, if I was a terrorist intent on taking over a plane and causing murder and mass destruction, odds of 99-point-something to 1 would seem pretty good to me that there was not a weapon on that plane. I do not think that is enough. Why? If there is a threat and if it is good enough for 2 percent of the pilots, why not all of the pilots? So I will be joining with the gentleman from Washington (Mr. Nethercutt) and others to offer an amendment today to not cap the program, to allow any pilot who wishes to volunteer, who is qualified, who can successfully complete the training and qualifications, to be armed properly onboard planes. Remember, this is the last point of defense. The standing orders of the Armed Forces of the United States are if a plane has been commandeered, if it is diverted toward a city, it is to be shot down. Now, you say there is risk with guns on the flight deck. That is true. But I will tell you, if I was sitting up there strapped in my seat, watching people commandeer a plane, at first I would try to stop them, but if they did take it over, I would much rather the pilot have the option to defend the flight deck than the United States Air Force having the option of taking that plane down. So I believe people should support that amendment. There also should be an amendment today, although I believe now it is not going to be offered, but to mandate that the FAA stop dragging its feet, the TSA, and train adequately all the flight crews, including the flight attendants. There is this attitude over at the FAA bureaucracy and the TSA of ``manana.'' We do not yet have the armored flight deck doors approved. Ultimately, we should be moving toward a redesign of the airplane where the pilots are up there with a lav, with food service, behind an armored flight deck door, like on El Al; and on El Al they do not arm the pilots anymore because they are in an invulnerable spot. But you are still going to have the flight attendants back there with the passengers. The flight attendants need proper training. They need coordination training to deal with air marshals, to deal with the flight crews up on the flight deck. They also need some self-defense training. It has been suggested that the airlines should do that sometime in the next 15 or 20 years. But, you know, it costs a little bit of money to train people, and you divert people from their schedules and you have got to pay them their salaries, so the airlines are not really very interested in doing that. We need to mandate that much more assertively in this legislation. We thought we mandated it in legislation we passed last November, but it is being ignored by a number of the airlines and by the bureaucrats. We need to do better today.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, the President had an opportunity to show strong leadership and get tough with corporate crooks yesterday. His speech was long, 27 minutes, on rhetoric but is short on action. The Business Roundtable and the National Association of Manufacturers applauded loudly; they endorsed it. Of course, they are the same people who fought every reform that was proposed over the last decade that could have prevented these abuses. They loved the President's proposal because it was short on action. The aide to the White House said, well, the proposals were watered down over the last few weeks because the President did not want to hurt the economy by imposing too much regulation. Hurt the economy? What has WorldCom done by evaporating $80 billion of equity, thousands of jobs and people's IRAs and 401(k)s? What has Enron done by manipulating the energy market and driving up energy costs in the western United States by 40 percent, while Ken Lay, the President's favorite guy, stole $100 million? That is hurting the economy. We need action, not rhetoric.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, the President has spoken and I do not take, unfortunately, much solace in what he had to say. He talked about a lot of voluntary reforms on Wall Street. He talked about the fact he has been waiting for months for a little bit of money from Congress for the SEC. Yet he denied his own toothless watchdog, Harvey Pitt, the head of the Securities and Exchange Commission, $91 million just 3 months ago. The President is born again into wanting to do something politically about the problem we have, but not really deal with the problems on Wall Street because that will offend some very powerful and very wealthy people, no matter how ill-gotten their gains. The fox is still guarding the henhouse and the President did not offer us anything today except political rhetoric.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, we are waiting now and in about 15 minutes the President will give a speech where he is expected to address the corporate meltdown, where millions of Americans have been defrauded of their stock holdings and their 401(k)s, thousands have lost their jobs and a few have profited mightily. The President says he wants to get tough. We are going to hear a lot of talk about watchdogs and teeth and enforcement and maybe putting some people in jail. Maybe. Probably not. But the real question is, is he serious? Until recently, of course, the President and Vice President Cheney had been touting their corporate experience and ties. Mr. Lay of Enron fame was called Ken Boy and was given unlimited access to the White House and the Oval Office. He is persona non grata now, perhaps. But are they serious? Unfortunately, the early indications are the President is not serious, but he is covering his political butt. That is because he is saying the SEC, which of course until recently he had stiffed in his budget, the Securities and Exchange Commission, the official watchdog of the United States of America over corporate malfeasance, which has been dramatically underfunded, yet the President proposed in his budget to not increase their funding, in fact give them a zero budget increase. Now he is going to propose a budget increase. That is good; so maybe he is serious. But then he goes on to say the head of the SEC is doing a great job. This guy's name is Harvey Pitt. Harvey Pitt represented most of the firms and the individuals who are now taking the fifth amendment before Congress. In fact, in a recent action before the Securities and Exchange Commission, the toothless watchdog that we have on guard, headed by Mr. Pitt, appointed by Mr. Bush, who Mr. Bush says he has utmost confidence in, found, this is amazing, actually found that a firm, Ernst & Young, had violated its duty to remain independent from companies it audits. That is good. But guess what? The finding which would ultimately in fact have involved a substantial fine was thrown out by an administrative law judge. Why? Because the facts were not right? No. Because they had not committed the malfeasance? No. Because Mr. Pitt is so conflicted that he could not vote and also Cynthia Glassman, the other SEC commissioner, was not allowed to vote, either, because they both had intimate ties with this firm. They had represented them, worked with them; and when they leave their so-called public service, they will represent them again as $500- or $1,000-an-hour lawyers. So this company got off the hook because only one commissioner, the one appointed by President Clinton, could vote. The judge said, There were three of you there and only one of you voted. I'm throwing out the judgment against Ernst & Young. This is the watchdog that the President has ultimate confidence in, a man who is so conflicted from his previous work, who represented many of these same securities firms, many of these same accounting firms, many of these same corporations and CEOs, he is so conflicted that when he was asked recently was it not a conflict of interest for him to meet with some officials from Xerox while there was an ongoing investigation, this is Harvey Pitt, our watchdog, our public servant. He said, If I recuse myself from meeting with everybody who I had represented or had personal relationships with, I wouldn't be able to meet with anybody. That is the man in whom President Bush is supposedly going to invest more authority to investigate and prosecute, a man who just came from representing these people and as soon as he is done with his public service will return to representing these same miscreants. This certainly does not give me a great deal of confidence in the independent role and the aggressive role of the Securities and Exchange Commission; and it does not give me a great deal of confidence that the President is really serious about what he is doing here. Certainly there is a lot of political butt to be covered. Yes, he is doing a good job of that. But will he get serious? If he does not announce that he is removing Mr. Pitt, that he is going to have people who do not have conflicts of interest in charge of investigating and prosecuting these companies, people who could actually vote to prosecute, who would not have to recuse themselves because of those conflicts, then we will know he is serious. In 10 minutes we will hear.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, today the President gave a long, rather long speech full of words that really administered a pretty heavy feather duster to the miscreants on Wall Street, the CEOs, the analysts and the others who have been robbing our corporations, our economy, blind. He said he was not going to put up with it anymore. He was going to get tough. But it is more what he did not say than what he did say that is important. He did not say he would support tough legislation to overhaul the securities firms, the Sarbanes bill. He did go on to say he would support the weaker House version, the one that really would not do anything for pension reform or auditing, the show bills that passed the House here before this thing really imploded, that the Republican majority pushed through. They would still allow corporations to direct their employees to be stuck with stock and would not really fix the problems of auditing and those things. He did not talk about corporate tax dodges. The phony incorporations of U.S. firms in Bermuda to avoid tens of millions of dollars in taxes. He did not talk about rescinding his order which would allow corporate lawbreakers to get government contracts. He did not say a word about Harvey Pitt, the toothless watchdog of the Securities and Exchange Commission. Now the principal watchdog over America's securities firms and the stock markets and all those financial investments, all of those very complicated, high falooting things which have allowed people to steal hundreds of millions, billions, of dollars, bankrupt companies, put people out of work, steal their pensions and crater the 401(k)s of tens of thousands of American. We have an organization already in place that is supposed to take care of that. The Securities and Exchange Commission. Earlier this year, just a couple of months ago, the President proposed a zero funding increase for them. Today, he pretended that he had been asking for a long time for more money for the SEC. He has not been, but I am glad that he has been born again in asking for some increase. But the increase he is asking for is a tiny fraction of the money that has been stolen. It will be inadequate to make the SEC the kind of watchdog we want as long as Harvey Pitt is the chairman. Now, Harvey Pitt is a former securities lawyer. He is so compromised that when he recently met with a firm that was being investigated and he was questioned about it, he said, well, look, you cannot ask me not to meet with firms that are being investigated by the SEC just because I represented them, because then I would not be able to meet with anybody. This is our watchdog. This is the President's appointee. This is the guy who is going to bring honesty. Come on. If that gentleman is not removed the President is not serious. Recently the SEC tried to do an enforcement action against Ernst & Young. There were three commissioners present. They heard the evidence and at the end, the evidence was compelling, Ernst & Young should pay a fine. They had committed some improprieties. But guess what? Only one of the three SEC, Securities and Exchange Commission, members could vote because the other two were so compromised that they would have been penalized under law for voting because of their associations with this firm. So the one voted to penalize them, the Clinton appointee. But then an administrative law judge said, you cannot convict these people with one Securities and Exchange commissioner. You have to have more than one. So here we have a Securities and Exchange Commission which is so compromised with their contacts, with their clients, who have represented all these people robbing America blind that they cannot even vote on enforcement actions. And the President is trying to tell us with his speech today, by God, he is taking care of this problem. He has not taken care of the problem. He has tried to take care of one problem today and that is the political problem he has, the gathering storm of anger in this country that is beginning to look for someone to blame for the fact that billions of dollars of wealth have evaporated. Americans are opening their 401(k) statements this month and many of them are shocked, disappointed and, yes, angered. They want to know who is responsible. How could these high-flying companies, how could these CEOs who are paying themselves tens of millions, hundreds of millions of dollars, boards of directors loaning themselves hundreds of millions of dollars, how could they suddenly be worthless? How could their 401(k)s have dropped so much? Because the money was stolen. And because there is no one home to enforce the law. The Securities and Exchange Commission is the place to enforce the law, and until the President replaces the compromised people on the SEC; he has even got one nominated now, he comes from a securities firm. But as soon as that person gets there, he will not be able to vote on any of these things because they worked on all of these things. These are their buddies, the people they go to the luncheons with, the country club, they go yachting with, they go to their multimillion- dollar homes in Florida with. We need to clean up this mess. The President had a chance today; he did not take it. Perhaps we can give him another chance again soon. Perhaps the Republican leaders of the House will relent and allow real reforms for pensions, real reforms for securities. Maybe they will undo some of the things they did back in 1995, which essentially exempted these securities firms from prosecution. We can take some real measures here if there is the will. But there is so much money flooding from these people into politics that I fear we will not get there. Some of us will continue to speak out. Others will begin to speak out. But will they put their vote where their mouth is? And will the President really put firm steps where his rhetoric is? Not today. Tomorrow is another day. Americans will be a little madder tomorrow. This will still be going on tomorrow. Let us see what happens then.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, tomorrow the President will go to New York, to Wall Street, to give a much-anticipated speech on reforming the mess in corporate America. Now this will be an interesting day because this is the same President and Vice President and cabinet who have long touted their extraordinarily tight ties with corporate America; the same President who appointed Harvey Pitt, a former securities lawyer, as head of the Securities Exchange Commission; Mr. Pitt, who, when he was sworn in, promised a kinder, gentler Securities and Exchange Commission, even while all these abuses were going on. And, in fact, recently Mr. Pitt was berated for meeting with people from a firm under investigation; and he said, well, how could I not meet with people from firms under investigation who I represented? I represented them all. He is saying as the head of the Securities and Exchange Commission, basically if he recused himself for conflict of interest from his former clients, and obviously future clients when he leaves his measly government salary and goes back to earning millions of dollars a year, representing these crooks and swindlers, he would not be able to do his job. In fact, he is not able to do his job. Just the other day, an administrative law judge dismissed a finding by the SEC because Harvey Pitt could not vote, because he can meet with these people, he can consult with them and talk with them and tell them what the SEC is looking at and doing about them, he can do that; but the line is drawn by Federal law at voting. If he has recently represented these people, which he has, he could not vote. So in the case of Ernst and Young, Chairman Pitt had to recuse himself. Commissioner Cynthia Glassman had to recuse herself. So there was only one person left to vote who was a Clinton appointee, who did not have a conflict of interest, who had not represented these miscreants previously; and an administrative law judge said that is not adequate, you cannot have just one person vote to prosecute these folks. Now we are confronted with the fact that we have a Securities and Exchange Commission, which has been dramatically underfunded by the Bush administration, 40 percent less than the House budget which was not adequate. In fact, the President, as recently as March, and his staff were representing a zero funding increase for the Securities and Exchange Commission, the one that is so outgunned, and now the one they are bragging on for doing all of this investigating and putting these people in jail and all this stuff they are going to be doing. Of course, they cannot do any of that if the head of the Securities and Exchange Commission is so extraordinarily conflicted that he cannot vote in any of the prosecutions and other members of the board are also conflicted. In fact, the President has nominated yet another person from another accounting firm to be on the board of the Securities and Exchange Commission. Hopefully, what we will hear tomorrow from the President will be something that is a radical change from the first year and a half of his administration, where they have been coddling these crooks and criminals, the Ken Lays of the world, that basically wrote the energy policy of the United States of America. The Bush administration has yet to release the documents regarding the meetings that Mr. Lay and Enron had with the administration in formulating that policy. We do know that Enron met more than once a day, more than once a day, this giant corporation met with the energy commission, more than once a day. That is a real good distance. Those are the kind of watchdogs we want. Mr. Pitt and the SEC are kind of reminding me of my old chessie bear. He is a wonderful old dog, a great watchdog, but he is now 13\1/2\ years old, much past his expected longevity for a chessie. His teeth are kind of worn down and he is still a big dog, and even when he barks, we know it is not very serious. That is kind of what we got at the SEC today, and I am afraid that is what we are going to get from the President tomorrow. There will be some barking, but there are not going to be any real teeth; and we are going to know it is not very serious because the people that they would have to go after are the same people who contributed to the record fundraiser the Republicans had 3 weeks ago, the record amount of money that President Bush raised in his Presidential campaign. Their largess might be constrained. I mean, sure, they have hidden some of it in places where we cannot go after it, like mansions in Florida and that; but we want to make sure, I am certain, that they have some left to contribute to political causes after all. So I expect we are going to get the toothless, barkless watchdog tomorrow. We are going to have to watch very carefully what the President proposes. Will he support the Senate bill, the Sarbanes bill? Thus far they have opposed it and supported the phony bill that passed the House to reform some of these practices. Will they go after the corporate tax havens? Will they go after these thieves and crooks and criminals and put them in jail? Will they try and get Americans back their 401(k)s and pensions or not? The proof will be in the speech tomorrow. We will all listen carefully.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I move to strike the requisite number of words. I had not intended to speak on this amendment, but heard the gentleman before me when I just came back from the energy conference to my office. I believe there is a credible nuclear threat against the United States of America. There is a possibility that a rogue nation or terrorist group will deliver a nuclear device to the United States of America, but it will not be on the tip of a missile. This misbegotten technology, if it ever worked, would not defend against a depressed launched trajectory missile from a submarine, against stealth missiles, against bombers, against all those other threats. But not even those are the real threats, and that is not the real failing of this. It will not defend against the container, one of the 500 million that come to the United States every year. That is the most likely vehicle for a nuclear bomb in the United States of America. A simple bomb attached to a GPS device gets to a certain point in the United States and it blows up. And guess what? While we are spending $100 billion or more of our hard-earned tax dollars to try and take this totally failed and continually failing system, one that has to be notified in advance, has to have a GPS device tracking the incoming missile, one that cannot take on any sort of devices that would cloak or hide the missile or in any way make it more difficult to hit, they are going to be attacking us in another way. It is a real shame. The one thing we have that really works are our satellites and our detection capability. The second that one of those rogue nations launches a missile against the United States, we will know it, and in 20 minutes that nation would no longer exist. They are not going to launch missiles against the United States. They might buy a junk freighter, they might sneak it into a container, or they might put it in a van and drive it across the border from Mexico or Canada. There is a whole bunch of ways they might deliver a nuclear weapon to the United States. And while we are wasting money on this program to enrich the defense contractors with failing technology, they will be making their plans. It is just extraordinary to me after 9-11, when they commandeered our civilian aircraft and used them as weapons of mass destruction, that we are still obsessed with trying to build technology to fight a threat that does not exist. Yes, the North Koreans. The North Koreans once launched a missile that, if it had worked, might have reached the United States; and someday they might have two or three of them. Well, the leader of North Korea might be nuts, but he is not nuts enough that he wants to turn his country into nuclear glass. Our assurance of deterrence, mutually assured destruction, in this case, is not mutually assured. They might hit some tiny corner of the United States, which would be very tragic, and I doubt very much they will even try to do that, but we would totally devastate them. That is not the way they will deliver these threats. There are credible threats. Let us invest some of this money in a technology to screen the 500 million containers coming into the United States, to screen the Mexican semis that are about to start streaming across the border to all points in the United States with no inspection. How do my colleagues think they are going to deliver it? They are not going to try to build a missile and then shoot it at us and let us detect it. They will put it in a truck, they will put it in a container, maybe a suitcase or maybe a van. And while we are wasting all this money for technology that probably will not work anyway, they are going to be planning a credible attack.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, well, today's headlines, WorldCom Finds Accounting Fraud, $3.8 billion, slight misstatement of their earnings. The stock dropped from $64.50 down to a few pennies, and 17,000 people will lose their jobs, but the former CEO is living happily in his mansion on the millions which he looted, as are many of his cohorts. This is a pattern that is being repeated time and time again. It has gone on for far too long. It started a year ago today with the energy scandals in the West, little more than a year ago today. We were told by the Republican majority this is market forces at work, you have not built enough plants, has nothing to do with market manipulation. Well, now we got the memo that, in fact, Enron was manipulating the markets, but even with those market manipulations they went bankrupt. Their former CEO, Mr. Lay, and their former Chief Operating Officer, Mr. Fastow, have between them more than $100 million while employees have lost their pensions and their jobs. This seems to be a pattern, does it not? What is the response of the Republican majority? Well, we pretended to adopt pension reform, but we did not prohibit what Enron did to its employees happening at other corporations, and it looks like there is a whole heck of a lot of other corporations out there on the edge while the CEOs are living on the gravy here, and that was sort of the initial response. Then we had another little scandal coming along here which was American corporations do not think they should pay taxes anymore. Stanley Works wants to move to Bermuda, set up the new Bermuda Triangle, avoid U.S. taxes on its U.S. earnings and its overseas earnings. Bank of America has done the same scam. The corporations are lined up from here to Sunday to do that. What is the response on that side? Well, the Secretary of the Treasury says our tax laws are too complex, this is a rational response by these unpatriotic corporations who are ripping off the American people, taxpayers and their own employees, and the majority leader on that side says he endorses this practice that they should not pay taxes unlike working wage-earning Americans. Then we had Global Crossing, the CEO, a couple hundred million bucks there, little accounting scandal; Enron, accounting scandal; Tyco, accounting scandal; now WorldCom. What have we done about the accounting system? Well, we are going to let the market work, the Republicans said. We adopted some securities and accounting reforms here. They say let them police themselves. Of course we get Harvey Pitt, Harvey Pitt appointed by the President of the United States, George Bush, to be headed by the Securities and Exchange Commission. He is a former lawyer for the securities companies that are out defrauding the American people. He is going to be a real lap dog down there. So the response here is status quo, do not upset the boat. So there seems to be a common trend here which is we are in a meltdown. American CEOs are discredited, American corporations are discredited, the stock market is crashing, hurting average Americans; and the response on that side of the aisle is do not do anything, let market forces work and, by the way, let the CEOs skate. Oh, yes, we did do one really important thing last week. We passed the permanent repeal of estate tax for people who have over $5 million of assets to make sure that Ken Lay, Mr. Fastow, and all these others who have ripped off tens of millions of dollars from their employees will never pay any taxes on the money they stole. God forbid they should, because they are all major contributors. Last week the Republicans held the largest fundraiser in the history of Washington, D.C., headlined by the wonderful pharmaceutical companies, but followed up by many of the other players whom I have mentioned here because their CEOs happen to be awash in cash, and they want to make sure they do not go to jail. So they are becoming more and more generous in their contributing. This is the most outrageous scandal in the history of the United States. The largest restatement of earnings by a corporation, tens of thousands of employees losing their pensions, their jobs, millions of Americans losing their 401(k)s, their pensions; and the response on the Republican side of the aisle is nothing, because they are frozen in place by the fact that they are taking so much money from the people who have perpetrated these frauds. I hope that the American people demand and vote for some change next fall.

Mr. DeFAZIO

Mr. DeFAZIO. Headline: ``WorldCom Says Its Books Are Off By $3.8 Billion.'' Hey, we all make mistakes. $3.8 billion. The stock market is going to tank again today. The dollar is in a headlong decline. It seems like it would be a no-brainer for the House of Representatives to plug a few tax loopholes; mandate, mandate, by God, tough accounting reform; put a few of these crooked CEOs in jail, prosecute them, pursue them endlessly. Let us have real protection for stockholders, employees' pension funds. But no. It is needed, it seems like a no- brainer, but it ain't going to happen here because the House Republican leadership is too busy collecting campaign funds from some of the same firms and CEOs that are defrauding Americans and the stock market. The American people need to focus and demand meaningful reforms before this disaster spirals totally out of control and drives the U.S. economy into a full blown financial crisis. No more sham reforms of pensions, no more sham prescription drug benefits, no more shams on the Tax Code. Let us do some meaningful work here and try and fix the problems with America's economy.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I move that the House do now adjourn.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I have come to address the issue of Amtrak, but I just cannot resist making some comments regarding one of the most bizarre and tortured speeches I have ever heard given by a Member who preceded me in the well. Yes, it is true Americans pay more than twice as much as most people who live in industrialized nations around the world for our pharmaceuticals, many of those pharmaceuticals manufactured in the United States by United States-owned drug manufacturing firms and somehow exported from the United States and sold for half or 30 percent of the price overseas where they still make money. He said all we need is a bigger dose of the free market in the Republican approach to this bill. We certainly do not want a government program like Medicare, that would actually rein in the price of drugs by negotiating it down using the market power of the 40 million people in Medicare, just like Blue Cross/Blue Shield does with their patients, just like the Veterans Administration does with their clients. Why? Because the pharmaceutical industry, who hosted the Republican fundraiser, the most successful in history, earlier this week, is bitterly opposed to that. They do not want the free market to work here in the United States. But what he was really commenting on was the fact that overseas they control the outrageous price of these drugs and the companies still make a profit. So it was one of the more bizarre and tortured speeches I have ever heard trying to get around the fact their bill will do nothing about the outrageous price of pharmaceuticals, and that in fact they are introducing and passing legislation written by the insurance and pharmaceutical industry. Now, on to Amtrak, another looming disaster. On Monday, the administration has a critical decision to make: Will they guarantee a loan for Amtrak to continue its operation, or will they kill Amtrak and kill our national rail system once and forever? Will we become the only major industrialized Nation on Earth without a national rail system? What happens the next time there is a 9-11 when there is no rail alternative? Where are those people going to go? What are our alternatives? This administration is rehashing again there another free market mantra. My God, Amtrak should not get subsidies. Well, yes, the trucking industry gets subsidies; automobiles get huge Federal subsidies; and, yes, the aviation industry got more subsidies in one day than Amtrak has gotten in 15 years. But Amtrak, no, they should not get a penny, because they compete with the regional airlines, and they are not liked by the freight companies. So the administration is falling back on this: let us make it like the British rail system. That is as credible as the idea of modeling our electricity on the British system, which we have done. Deregulation, the disaster in California, was modeled on what they have done in Great Britain. And, in fact, what they are proposing for Amtrak is modeled on what they have done in Great Britain. When I was over there earlier this year for aviation security issues, the paper was filled day after day after day with disasters, capacity problems, safety problems, crashes, dissatisfaction of the public. Divide off the rails from the actual providers of service. Yes, the Brits did that. It is a disaster. No, this is plain and simple an excuse to kill the system. And if the administration does not sign this loan on Monday, they have just signed the death warrant of the national rail system in this country, which would be a horrible tragedy. In my region, we have grown, with minuscule investment, rail passengers by 600 percent in 8 years. If we can turn it into a truly high-speed system, of course then it might compete with the aviation industry, we could get people to Seattle just about as quickly as they could get there and deal with the traffic problems coming to and from the airport in Oregon and the airline schedules. But they do not want to have that kind of a system. They do not want that alternative. They do not want it to be successful. They want to kill it. I challenged the administration on Monday, give them that loan guarantee and let Congress work its will in terms of reforming Amtrak, making it work better. We can do that, but do not just kill it with the lame excuse you want to make it like the failed British system. Why should we emulate the failures of governments overseas when they are well known and well publicized? And if you want to kill it, just be honest about it and say you want to kill Amtrak, in particular because a few airlines are concerned about their routes in the east coast and other quarters where rail is actually carrying almost as many passengers, and in Europe where, in fact, on less than 400-mile flights they do carry more passengers. It is a more efficient way to get there. If that is what the agenda is, at least be honest about it.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I thank the gentleman for yielding me this time. The base bill, H.R. 1979, Small Airport Safety, Security and Air Service Improvement Act, is an excellent piece of legislation. It will expand AIP eligibility criteria to allow small airports to construct and equip air traffic control towers and to participate then in the contract tower program. Now, if we stuck with current law, the FAA might or might not fund some of these projects. I have been trying to get one funded in my district where there is a strong need. It would be many years before they could meet the need because they have much more pressing requirements on their availability of funds for the largest airports. So an expansion, as envisioned in this bill, is good. In fact, for example, we heard earlier about the issue of firefighting. I will talk about in my district the airport that now has had substantial recurring growth which merits a contract tower in Coos Bay-North Bend. Actually, a few years ago, we had a tanker go aground, and we were up to 300 operations a day between the Coast Guard and other people who were involved in that recovery operation. And so the National Guard had to bring in a temporary control tower. We could not safely operate the airport. Since that time, traffic has grown because of construction of two fabulous new golf courses down in Bandon and general growth of the community and some improved commuter service to Coos Bay-North Bend. So they very much want to go ahead, but it is also a community that suffers high unemployment and does not have a tremendous amount of available capital. So this program will work well for them. They can go ahead with the contract tower. They can bond it by being able to demonstrate that they will have the cash flow to pay off the bonds. The only dissident note here is the retroactive reimbursement of communities who have already paid for towers. Now, I was a little confused by the gentleman before me because he said Members in rapidly growing areas should oppose the Oberstar amendment. No, actually, the opposite is true. Members from rapidly growing areas should support the Oberstar amendment and support the overall bill, because the Oberstar amendment is about retroactively reimbursing communities that have already paid for contract towers. And as we heard very eloquently, the gentleman before me from New Jersey explained how unfair this would be, particularly in terms of normal Federal contracting process, capability and eligibility of AIP funds, and a host of other issues. And as I spoke earlier, it is also a safety and security issue. These airports that do not have now and need to fund the tower, they have already funded it, but do have pressing security capacity and safety needs, would be diverting those funds from the security, safety and capacity to retroactively reimburse themselves for money that they never expected and, in fact, signed a contract saying they knew they would not be reimbursed for. We are changing the rules of the game. If we are going to start doing that with trust funds, whoa, we have a lot of bridges that could use some reimbursement and a few other things I would like to sell my colleagues here. This is a very bad precedent. These communities did not expect and do not now need to be reimbursed. We should not jeopardize the program or the bill in that way, because I understand there is substantial Senate opposition to that provision. We should go forward with the base bill, which will help rapidly growing communities, which will help secure their air safety in the future and help them move forward with the contract tower program.

Mr. DeFAZIO. Mr. Speaker, just in response to the previous speaker, we are talking about $150,000 a year would be the allocation. The towers cost over $1 million. So you are basically talking about 8 to 10 years of the allocation that will be diverted from safety, security and other issues for a retroactive, unanticipated reimbursement for an unqualified project. Now, we could do this pretty broadly. There is a whole lot of things airports have done out there that were not qualified that were expensive projects. My city of Eugene is still paying for their terminal expansion. Maybe we ought to qualify those sorts of things, because they did it before we authorized PFCs. We could change the Highway Trust Fund to reimburse a whole host of State and local projects that are not currently eligible. The point is there is a limited amount of money to do an extraordinary amount of work, and particularly in these days we are very concerned about the safety and security issues. These airports, with this retroactive, unanticipated dedication of their AIP money for 8 to 10 years, a lot of that work will not get done for 8 to 10 years. Yes, it will be a little bit of a windfall they did not anticipate, but, unfortunately, a whole lot of other needs will go unmet, maybe critical security needs, which may lead to another disaster.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, yesterday, the Republican majority leader, the gentleman from Texas (Mr. Armey), defended the actions of corporations that moved their headquarters overseas to avoid taxes. He said it is just like families taking an itemized deduction. Well, I have got to say it is not exactly like that because Americans who take itemized deductions are paying taxes at a much higher rate than these corporations. Citizenship has its privileges. It also has some obligations. In a time of crisis, for some of the largest and most profitable corporations in this country to be engaging in a tax dodge to avoid their obligations to our Nation, at the same time shovelling more burden on to working Americans, and then for the majority leader of the Republican Party to say, hey, this is fine, that is a new low for the United States House of Representatives. More than 90 million tax paying American families every April 15 are obligated to pay, but the CEOs and some of the largest corporations in this country, they do not pay anymore. Tyco International is one of the ones who has moved down there. Enron, another corporate citizen. He said it is about competitiveness. It is not about competitiveness. It is about corruption and theft.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, those who are watching might be puzzled, because it does not seem there are too many Members on the floor of the House, and that is because the House has completed its work day. It is about 3 o'clock. Now, why is the House out of session at 3 o'clock when it has yet to do a single appropriations bill, when many other important measures and needs of the American people have yet to be met? Well, it could be because tonight is the biggest fundraising gala, perhaps the largest single fundraising event in the history of the United States. Downtown, the Republican Party is holding a special fundraising event, and the chair, the fundraising chair of that event is a guy named Robert Ingram. Why is that relevant? Well, he happens to be the chief operating officer of GlaxoSmithKline, which happens to be the largest drug manufacturing pharmaceutical firm in the world. Now, why would he give $250,000 and agree to raise millions of other dollars from other pharmaceutical companies who are also contributing: Pfizer, Eli Lilly, Bayer AG, Merck & Company, they are cheapskates, they are only ponying up 50,000 bucks each for a table, but then PhRMA, their organization, is ponying up $250,000. Now, you have to give it to the Republicans. I mean they, the Republican leadership, either has the most incredible sense of irony and humor, or no shame. Here we are at a time when we are supposedly about to consider legislation to provide or not provide a meaningful prescription drug benefit to seniors in the United States of America, 54 percent of whom pay more than $1,000 a year out of pocket for their drugs; who are charged the highest prices of any customers of the pharmaceutical companies; the uninsured seniors are charged the highest price, prices that exceed those of Canada by 100 percent and other developed nations. Of course, many of those drugs were manufactured in the United States by these very same firms who are throwing this big gala tonight and contributing millions to the Republican Party. So we have to wonder if there is any connection between the draft of the Republican proposal and the timing of it, because they are considering it right now, and tonight's event. The Republican proposal is a free market approach. Of course, we have had the free market; it has not been serving our seniors very well, and prescription drug costs have been going up at 2\1/2\ times the rate of inflation. Many seniors have to make critical decisions about getting their prescriptions filled. I have actually met seniors, couples who had to decide who was going to get their prescription one month and who was not, even though they are all necessary and prescribed. These are real problems. The Republicans have decided they cannot ignore this issue anymore, so they have gone to their sponsors, the pharmaceutical companies, the insurance companies, who say, look, how about we phony up a bill that continues the status quo and we pretend it is a new benefit for seniors, and the pharmaceutical companies love it. That is why they are giving a quarter of a million bucks from this one company and millions in addition to that at tonight's gala. There is no guaranteed benefit under the Republican plan. Mr. Speaker, $20 billion over 10 years would go to the pharmaceutical companies as an inducement for them to offer free market, private policies. God forbid we should extend Medicare. They do not want to do that. No, they are very worried about that, because they know if we extend a Medicare benefit to the seniors, then we might begin to question the absolutely obscene prices they are charging for some of their drugs and we might even take steps to rein in those costs like Canada, Great Britain, France, Italy, Spain, Mexico. In fact, every other industrialized country on Earth has taken steps to rein in their obscene pharmaceutical charges. No, but not the United States. We are going to take a free market approach. First give them the $20 billion as an incentive to maybe offer a program and under this ``maybe'' program, this is what the Republicans estimate they would provide, a benefit that would total, of the first $1,000 of drug expenses, which is half the seniors in America spend $1,000, they would get a $182 benefit after their premium, their deductibles, and their out-of-pocket costs. Wow. Wow, $182. Now, that is really going to help out the seniors who are having trouble today meeting these costs. Of course, remember, this is only recommended. It is not required. God forbid we should put a mandate on the insurance companies. No, no, no, no, no requirement. This is just a suggestion, a suggestion, as opposed to a real Medicare benefit that the Democrats are providing as an alternative. The emperor has no clothes here. Have a good fundraising dinner tonight, guys, but I think in the end the champagne you are toasting tonight might taste like vinegar.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I ask unanimous consent to replace the gentleman from Oregon (Mr. Blumenauer) for 5 minutes.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, while the purported Republican benefit would total 16 percent of the first $4,500 of prescription drug costs, it would not reduce the outrageous and obscene charges of the pharmaceutical companies. Why? Because they are the sponsors of the big fundraiser tonight. Mr. Robert Ingram of GlaxoSmithKline, the chief operating officer, is the chief corporate fundraiser. His company has given one quarter of a million dollars to the Republicans, and they have delivered a bill that will do nothing to deal with the outrageous extortionist cost of prescription drugs in the United States of America. People will still be able to go to Canada and buy drugs manufactured in this country by their major contributors for half the cost, or Mexico for 40 percent of the cost, or Europe for a third of the cost. But, no, not here at home. Our seniors will be offered a Trojan horse benefit, 16 percent of the first $4,500 of their prescription drug cost. Boy, that is really going to help my seniors a lot. Do my Republican colleagues have no sense of shame, or is it just a sense of humor, to adjourn the House early to go to an event sponsored and paid for by the pharmaceutical companies while offering this phony Trojan horse benefit?